It’s no secret that I’m a huge Dave Ramsey fan.

Reading his book The Total Money Makeover completely changed my life.  My husband and I took Financial Peace University at our church and attended Dave’s Money and Marriage event in Minneapolis.

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Both of these experiences helped me to get my spender husband on board with Dave’s crazy seven step plan for financial freedom.  If you aren’t familiar with it, here are the seven baby steps:

  1. Save $1,000 emergency fund.
  2. Pay off all non-mortgage debt.
  3. Save 3-6 months’ of expenses.
  4. Invest 15% of income.
  5. College funding for children (if you have kids).
  6. Pay off your mortgage.
  7. Live and give like no one else!

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Dave recommends that people stop “keeping up with the Joneses”, start living below their means, work like crazy, “sell so much stuff the kids think they’re next”, and do whatever else they can to pay off their debt as quickly as possible.

When my husband and I were working on paying off $127,000 of debt (mostly student loans), we did a lot of crazy things, such as:

We were 100% committed and we wanted to “live like no one else now so we could live like no one else later”, as Dave recommends.

Since Dave encourages people to live below their means, it’s no surprise that people may feel a bit judgmental when they take a look at Dave’s current spending habits.

Dave lives in a $5,000,000 home on a mountain in Cool Springs, Tennessee.  The home is rumored to have mahogany walls, a master bathroom shower with 18 shower heads, and a full bar.  At over 13,000 square feet, it’s quite impressive.

Some use Dave Ramsey’s home as evidence that he is a hypocrite who does not live below his means…as he instructs others to do.

I’ll point out the obvious here: Dave is already on baby step #7 and has been for a long time.  He doesn’t need to be frugal to get out of debt.  He’s debt-free, owns a multi-million dollar business, and he’s living like no one else!  This isn’t hypocritical at all.  He’s simply enjoying step #7!

He never tells others to be frugal for the rest of their lives or to not have nice things.  In fact, he often says “It’s okay to have nice things as long as those things don’t have YOU.”

What he means is that it’s fine to enjoy nice stuff as long as we pay cash for it and we recognize that life is about more than stuff. If we keep this in perspective, there’s no harm in enjoying the $19 lemonade you’re sipping by the pool at your beachfront mansion.

It’s also worth noting that:

  • There’s no mortgage on Dave’s home – he paid cash, of course.
  • His net worth is estimated to be anywhere from $55 million to $200 million.  His home is a small percentage of his net worth.
  • It is likely that Dave tithes well over 10% and gives generously to charity.  After all, part of baby step #7 is giving like no one else!

Some have argued that Dave should live in a more reasonable home so he can increase his charitable giving…why can’t he live in a $1,000,000 home and give the remaining $4,000,000 to his church?

This argument doesn’t make a lot of sense to me.

I think it’s hard for middle class Americans to relate to someone who lives in a $5,000,000 home…but consider this.  How much does your home cost?

If you live in a $300,000 home, could you live in a $200,000 home and then give the rest to charity?

How many people actually do that?

It may seem like I’m comparing apples to oranges, but keep in mind that the cost of Dave’s home is a tiny portion of his net worth.  Your home is likely a much larger percentage of your net worth.

We can complain about how no one needs to live in a $5,000,000 home OR we can acknowledge that 5 million dollars is actually pretty frugal for someone with a net worth of 200 million.

It’s all about perspective and what we consider “normal”.

So…in short, I don’t think Dave’s a hypocrite.  I think he followed his own advice and is now enjoying living like no one else – as he should.


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