This heavy-duty mechanic from Canada makes $200,000/year — but has nothing to show for it. Says he’s ‘kind of just living.’ Here’s what Dave Ramsey told him to do ASAP

Biggest mistake rich people make

Jackson’s difficulty holding onto his high income isn’t unique. Roughly 36% of Americans earning more than $200,000 a year say they live paycheck to paycheck, according to a 2024 study by PYMNTs.

Among those in this income bracket, 22.8% cited family expenses as the top reason they can’t save money. Another 17% pointed to poor saving and financial habits as the main reason they live paycheck to paycheck.

Lifestyle creep and untamed budgets appear to drive many people to spend as much — or even more — than they earn. According to Ramsey, the biggest mistake high earners make is a lack of intentionality with their money.

Jackson, however, is determined to avoid that mistake.

“I feel like I make too much money to not have some sort of a plan and I don’t want to feel like a fool who squanders a fortune,” he tells Ramsey, who responds with a compliment: “Just asking the question puts you in the top 5%, dude.”

Ramsey’s advice? Start with a robust budget.

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Give every dollar a job

According to Ramsey, the only way to be intentional with your money is to set up a spending plan before the income arrives.

“We’re going to write it down — before the month begins — where every dollar is going to go,” he told Jackson. “Give every dollar an assignment. Contract with yourself. If you have a spouse, do it with your spouse.”

A tight monthly budget should help Jackson earmark cash for necessary expenses, discretionary spending, taxes and emergencies — and ideally leave extra for savings and investments. Working with a financial planner would also be ideal.

Unfortunately, only 27% of Americans use professional help for investment advice and services, according to a 2024 YouGov survey.

Most aren’t doing this work independently either. Just two in five Americans said they have a monthly budget or closely monitor their spending, according to the National Foundation for Credit Counseling.

In other words, a robust, professional budget is rare, which helps explain why living paycheck to paycheck is so common. You can avoid the same pitfalls by hiring a professional or setting up a solid budget of your own.