Dave Ramsey has built a business empire on offering supposedly plain-spoken, commonsense financial advice. Unsurprisingly, he has strong opinions about the financial aspects of homeownership. Specifically, he tells his listeners never to buy a house with more than a 15-year mortgage.
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His logic is that taking a mortgage with higher monthly payments will force you to pay off your home sooner, and with less interest overall. Or, as the Ramsey blog puts it: “Since you’re making bigger monthly payments on a 15-year mortgage, you’ll pay down the interest a lot faster, which means more of your payment will go to the principal every month.”
Ramsey argues this is the path to building equity in your home. However, others aren’t so sure. One TikToker, in particular, crunched the numbers and found that, for Ramsey’s approach to work, you’d need to make a whopping $190,000 a year.
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“Dave Ramsey is Wrong”
Creator Sime (@SimeMedia) opens his take — or, better put, takedown — of Ramsey’s homebuying advice with that bold statement. How does he know Ramsey is so wrong?
Sime starts with some basic math. As of 2025, the average home in the U.S. goes for around $350,000. Even with excellent credit, a 15-year fixed-rate mortgage on that amount would lead to a monthly payment just under $3,000 — and that’s before you factor in insurance, utilities or maintenance.
While Sime concedes “this isn’t terrible” (a generous take, considering that figure is above the national average rent), he quickly complicates the equation. Ramsey’s other major rule — “Never buy a house where the payment is more than a fourth of your take-home pay” — raises the bar even higher.
That means, to comfortably afford a $3,000 monthly mortgage under Ramsey’s 25% rule, you’d need to bring in $12,000 a month after taxes.
That translates to a pre-tax income of around $190,000 a year.
You Need To Be in The Top Percent of Earners To Be a Homeowner
At least, according to Ramsey’s logic, you do. Sime points out that in order to adhere to Ramsey’s homebuying rules, you’d need to be in the top 6% of U.S. earners to afford even an average home.
Sime anticipates people chiming in with comments saying Ramsey’s advice works fine with a less expensive home. So, Sime takes the theory for a spin in a lower-cost market.
Let’s say you want to buy a home in Mississippi, the state with the lowest average home prices. There, the average home goes for $180,000. On a 15-year mortgage, your monthly payment would be around $1,600 — again, before insurance, utilities or upkeep.
To keep that $1,600 mortgage under 25% of your take-home pay, you’d need to bring in around $6,400 per month after taxes, or roughly $95,000 a year. That’s still much more than what the average American brings in every year.
“Even if you’re in the median household income of $80,000 per year, you would not be able to afford to live in the cheapest state in the country if you follow Dave Ramsey’s advice for buying a home,” said Sime.
Work With People Who Know Your Situation
While it’s tempting to assume that famous experts like Ramsey have all the answers, at the end of the day, they don’t live your life — or know your numbers. So, it’s easy for them to offer pithy, absolutist advice with an authoritative tone, even if it doesn’t match most people’s reality.
You’re better off working with a financial advisor and a real estate agent who can help you map out your homebuying journey based on your actual income, expenses and local market.
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Ramsey’s advice might work — if you’re in the top 6% of earners. For everyone else, flexibility and context matter more than rigid rules.
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Sources:
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Ramsey Solutions, “15-Year vs. 30-Year Mortgage: What’s the Difference?”
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Sime, “Dave Ramsey is Wrong”
This article originally appeared on GOBankingRates.com: Dave Ramsey’s Home-Buying Advice Is Solid — if You Make 190K a Year
