His marriage collapsed, then his debt hit $169K. Here’s what The Ramsey Show advised — and it fits Canadians facing the same spiral

For Mark, those numbers are very real. With limited work options due to an undisclosed health condition and a son attending school for only three hours a day, he relies on approximately US$4,080 (C$5,620) a month in veterans’ disability benefits, plus occasional side income of up to US$2,000 (C$2,750).

Even with the income Mark earns, his debt keeps piling up. He carries roughly US$65,000 (C$89,400) in consumer debt — including a US$37,000 (C$51,000) car loan, about US$18,000 (C$24,800) in overdue loans and US$10,000 (C$13,800) in collections — alongside a mortgage that pushes the total to US$169,000 (C$232,500). And he’s behind on his debt repayments.

Against that grim reality, here’s what Warshaw and Delony recommended.

A note for Canadian veterans and disability benefits

In Canada, veterans may be eligible for two distinct disability benefit programs through Veterans Affairs Canada (VAC). The Disability Pension — a legacy monthly benefit under the Pension Act for service before April 1, 2006 — pays a single pensioner with 100% disability C$3,513.48 per month as of January 1, 2026. That amount increases with dependents: a married pensioner receives C$4,391.85/month, rising to over C$6,200/month with a spouse and multiple children. These benefits are tax-free and adjusted annually by the Consumer Price Index.

For veterans who applied for disability benefits on or after April 1, 2006, the Pain and Suffering Compensation (PSC) applies instead. The PSC is also a non-taxable lifetime monthly benefit — or an optional lump sum — but operates on a different rate scale. As of April 1, 2024, monthly PSC payments range from C$67.77 to a maximum of C$1,355.38, depending on the assessed degree of disability. Unlike the Disability Pension, the PSC rate does not automatically increase for dependents, though additional benefits such as the Caregiver Recognition Benefit may apply separately.

Veterans unsure which program applies to them should contact VAC directly or visit My VAC Account to confirm their entitlements and assessed disability percentage.

Why he should attack consumer debt first

Delony didn’t sugarcoat the situation; he pushed Mark to stop blaming his circumstances and take full ownership of his path forward.

“A bad thing happened, and… [you] chose to handle this bad thing in these ways. That ownership is critical for the next step,” the co-host said.

With that established, Warshaw laid out a game plan built on Dave Ramsey’s recommended repayment method: The debt snowball.

The snowball strategy is straightforward: List all debts from the smallest balance to the largest, completely ignoring interest rates. Throw every extra dollar at the smallest debt while paying only the minimums on the rest. Once that debt is cleared, redirect the freed-up payment into the next one, and so on.

The snowball is “all about quick wins and maintaining momentum,” Warshaw said.

An alternative approach, the debt avalanche method, targets the highest-interest debt first — potentially saving more money over time. For those carrying high-interest debt such as credit card balances, which in Canada can run as high as 25.99% annually, the avalanche approach can be the better financial fit.

For Mark, zeroing in on his consumer debt rather than spreading his payments thin across all accounts is central to the strategy. Warshaw noted that scoring early wins is psychologically vital when someone feels buried under a mountain of balances.

How to tackle collections debt

Warshaw also highlighted a massive opportunity many people overlook: negotiating collections debt for a fraction of what they owe.

Her advice to Mark: Build a cash cushion of roughly US$3,000 to US$4,000 (C$4,100 to C$5,500) first. Then contact the collection agency directly and offer a lump-sum settlement — starting at just 20% to 30% of the original balance.

This approach works north of the border too. Licensed Insolvency Trustees (LITs) and credit counsellors confirm that creditors in Canada will often accept a partial settlement rather than chase a debt indefinitely. A starting offer of around 30% of the total balance is widely cited as reasonable.

One rule applies on both sides of the border: Never pay anything until you get a written settlement agreement. Don’t give the collection agency access to your bank account.

Canadians also have a formal, regulated option that doesn’t exist in the U.S.: A consumer proposal. Filed through a Licensed Insolvency Trustee, a consumer proposal lets you repay a portion of your unsecured debt over up to five years while keeping your assets — and stopping all collection action. As of October 2025, 78.6% of Canadians who file for insolvency choose a consumer proposal over bankruptcy.

What someone in Mark’s position needs to do next

Warshaw’s more aggressive restructuring plan calls for a US$7,000 (C$9,600) credit union loan. The idea: Put US$2,000 (C$2,750) to the remaining balance on the car loan — Mark’s paid off US$35,000 (C$48,200) of US$37,000 (C$51,000) — and use the remaining US$5,000 (C$6,900) to replace the vehicle with a used option bought privately. That move frees up monthly cash flow and immediately cuts exposure to high-interest debt. In Canada, credit unions are a well-established alternative to the big banks, often offering lower interest rates on personal loans.

The Ramsey Method doesn’t stop at shuffling balances. It demands what Ramsey calls “gazelle intensity” — an all-out push to eliminate debt that includes cutting non-essential spending, selling assets you don’t need or use and directing every spare dollar toward what you owe.

It also means pausing all investing — including Registered Retirement Savings Plan (RRSP) contributions and any employer group RRSP matching — until the consumer debt is fully cleared. The logic: Guaranteed debt interest almost always outpaces long-term investment returns. That said, Canadians should check on pausing RRSP contributions if it means forfeiting employer matching — free money that’s hard to ignore.