For a married couple – a professor and a nurse – simply earning a good salary is not enough. They are in debt, they have almost no financial flexibility.
“I feel like we’re just kind of sloppy and not going anywhere,” Stephanie told Ramit Sethi in an episode of her podcast. Money for couples Posted on February 10 (1).
Stephanie and Chris, both in their early 40s, have three young children – two with special needs. Their gross income, combined, is about $155,000 a year. But they have $544,000 in debt — including a $460,000 mortgage — and while they have some investments, mainly from former employer-sponsored retirement plans, they have no other savings.
Perhaps most surprising: 92% of their net income goes to fixed costs.
In an emergency, “I think we’re going to be in big trouble,” Stephanie told Siti.
But budget tweaks may not be enough to solve their financial woes. Sethi says they have to deal with what is really hindering their financial future.
When fixed costs consume nearly all of a family’s take-home pay, it’s usually an emergency rather than a crisis. In addition to their mortgage, Stephanie and Chris have about $15,000 in credit card debt with a $13,000 line of credit balance, while their parents owe $50,000.
Fixed costs at 92% “Tell me a lot, tell me they’re broke, tell me they’re spending more than they should,” Sethi said.
Citi’s Conscious Spending Plan organizes household income into four buckets: fixed expenses (including essentials and subscriptions or memberships) at 50-60% of the house payment, investments at 10%, savings at 5-10% and delinquent spending at 20-35% (2).
Read more: The average net worth of Americans is a staggering $620,654. But it makes almost no sense. Here’s the number that counts (and how to make it skyrocket)
There are a number of other budgeting frameworks, such as the 50/30/20 rule in which you spend 50% of your after-tax income on necessities, 30% on wants and 20% on savings and debt repayment.
But you can’t start organizing your finances if you don’t know your basics. For example, Stephanie and Chris recently bought a bigger house at a time when Stephanie cut back on her hours at work.
“After the third child, we needed a bigger place and we took half the number and said it’s worth it,” Chris told Seti. But at that time Stephanie was working full time. They did not adjust their expenses when she decided to work less.
At the heart of the couple’s problems, Sethi says, is their intimacy. They get stuck in the weeds and can’t make good, long-term decisions. This is evident in their relationship.
In fact, nearly half (44%) of Americans are not comfortable talking to their partner about finances because they worry it will lead to disagreements, according to a 2025 survey by Wise (3). And it does so often, with couples reporting an average of 58 money-related arguments per year. Reasons ranged from “necessary” expenses (43%) to deciding how much to save (34%).
But, past research has shown that “when couples work together and talk about money, they spend more responsibly and are generally happier,” said Nirjana Mishra, a consumer psychologist at the Yale Center for Consumer Insights (4).
Sethi says the couple must develop a “fundamentally different relationship with money” and go from defense to offense.
“You’re two partners, and the truth is, you need to invest. You need to make loans. You need to save,” Seti told Stephanie and Chris.
Chris is due for his annual raise, and Stephanie can put in more hours at work to bring in some extra cash, but according to Seti, they need to be more careful about their spending. For example, their monthly budgeted expenses include $2,000 for groceries, which Stephanie admits she spends without meal planning, resulting in “a lot of food going to waste.”
When struggling with debt, couples have some tried and true options. The snowball method focuses on paying off the debt with the highest interest rate first. The snowball method focuses on paying off the smallest balance first (which can be very motivating) and working your way up to the largest balance. They may also consider debt consolidation.
Freeing up room in their spending by reducing their fixed costs and paying off debt can allow them to resume investing – which had been reduced to zero at the time of the event – and saving for retirement.
Stephanie and Chris need a vision of where they are going so they can also work towards their long-term goals. And it starts with relationships.
“While it’s about the numbers, it’s not about the numbers,” Stephanie told Siti. “It’s about how we communicate with each other, being honest with each other, not dancing around the issue,” instead of using each other’s “excuses for inaction.”
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I Will Teach You To Be Rich (1); IWillTeachYouToBeRich.com (2); Wise (3); Yale Center for Consumer Insights (4)
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