May 12, 2026
You may think that earning six figures would guarantee financial breathing room — or at least make it easier to get out of debt. But for many professionals, a high income doesn’t automatically mean financial stability if lifestyle costs, debt and spending creep eat away at your take-home pay.
That’s exactly the situation one caller found himself in on The Ramsey Show (1). Lance brings home about US$8,000 a month — roughly a six-figure salary — but feels like he’s “treading water” as he tries to tackle a US$65,000 debt. He’s been “living like a hermit" for six months, but his progress feels invisible.
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When cohosts Rachel Cruze and George Kamel asked where his money was going, Lance responded: “The rest just trickles out there.” But as the hosts dug a little deeper, the problem wasn’t random trickle — it was big-ticket spending.
Lance had purchased a brand-new US$30,000 Harley-Davidson, a US$25,000 truck and was still paying off a US$8,000 personal loan. Looking at the numbers, the hosts urged him to sell the motorcycle and truck, and throw those proceeds toward his debt.
The real red flag for the hosts wasn’t the debt itself — it was the lack of financial awareness. As Cruze stated: “I want you to be able to know and control your money and where it’s going.”
Their advice highlights a financial reality that applies far beyond this one caller, even Canadians: high income can hide a spending problem, but it can’t fix one.
Juggling big debt and high income
High-income earners aren’t immune to financial strain — in fact, many struggle with debt and cash-flow gaps.
According to Statistics Canada, household debt levels remain high. Total household credit market debt exceeded C$33 billion in 2025, which means Canadians owe roughly C$1.77 for every dollar of disposable income (2).
Consumer credit — non-mortgage debt, which includes credit cards and personal loans — is also rising. Equifax Canada’s 2025 Market Pulse report shows consumer debt climbed to around C$2.58 trillion, with the average non-mortgage debt per person sitting at about C$22,147 as living costs keep rising. In fact, credit card balances are growing faster than any other spending category (3).
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As consumers continue to carry a credit card balance, financial strain increases. A Bank of Canada analysis found that Canadians who carry a balance over multiple months are more likely to experience financial stress and risk falling behind on other payments (4).
Rising costs for living essentials such as groceries, transportation and housing are major contributors to this financial stress, and are greatly affecting Canadians’ ability to meet everyday expenses, according to a 2024 StatCan study (5).
At the same time, many Canadians report just getting by between pay dates. A recent survey by H&R Block found that about 85% of respondents say they’re living paycheque to paycheque, highlighting how common it is for households to feel their income doesn’t reach far enough — even before debt repayment (6).
That said, despite having a six-figure income, it’s entirely possible for debt loads to grow faster than disposable income — particularly if you don’t intentionally track and manage your lifestyle spending, vehicle financing, personal loans and credit card use.
To summarize the cohosts' advice to Lance, which holds true for all Canadians: having a clear picture of income and spending can help you take control of your financial commitments.
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People at all income levels need a budget
High income on its own isn’t enough to keep debt under control when food, housing, transportation and interest costs keep rising. The first step to breaking the cycle is knowing exactly where your money is going.
Start by building a monthly budget using your net pay — the amount you take home after taxes and deductions. List your essential expenses, like housing, utilities, groceries, transportation and insurance premiums, then add your minimum monthly debt payments. Whatever’s left over is the amount you can direct toward extra payments, savings or discretionary spending.
From there, choose a debt repayment strategy that matches your goals:
Debt Snowball. Pay off your smallest balance first to build momentum. As you see your debts disappear, your motivation will feed into that momentum until all debt is paid.
Debt Avalanche. Pay down the highest-interest debt first. This saves more money over time, especially with credit cards and personal loans.
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Small behaviour tweaks can also make a difference. Some people pause discretionary spending for 30 days to “break the habit,” while others set weekly spending limits or delete saved cards from shopping sites to curb impulse purchases. Removing marketing emails and push alerts can also help limit any spending temptations.
The important part is to stop expecting perfection. These spending adjustments are about being aware and intentional with where your money goes. As Cruze noted in Lance’s case, the issue wasn’t his earnings, it was a lack of tracking: “You make great money, you work hard,” she said. “You’re changing for the better.”
With structure, even a six-figure salary can help you dig out of debt faster than you expect.
Bottom line
Lance assumed his income should have been enough to cover everything by default — but without a budget, his money “trickled out” and debt piled up. His situation is a reminder that higher pay doesn’t replace the need for a spending plan.
Whether you make C$50,000 or C$150,000, tracking your expenses, choosing a debt strategy and temporarily cutting back can free up cash quicker than you realize. If you’re feeling stuck, start by writing down where your money actually goes — clarity is the first step to control.
-with files from Melanie Huddart
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
YouTube (1); Statistics Canada (2, 5); Equifax (3); Bank of Canada (4); Ontario Housing Market (6)
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Chris Clark is a Kansas City–based freelance journalist covering personal finance, housing and retirement. A former Associated Press editor and reporter, he writes plainspoken stories that help readers make smarter financial decisions.
