Dave Ramsey shares how woman with £15k saved can get by in retirement


On the Ramsey Show Highlights YouTube channel, the American personal finance personality answered a listener’s questions about her future. Betsy, 66, was worried about her future as she thought it “might be too late”.

She explained that she has had money throughout her life due to inheritance and businesses, however she is worried that she did not save enough.

Betsy sold her business a few years prior for $200,000 (around £176,000) and she also sold her house so now rents a property each month.

She still has around $200,000 (around $176,000) altogether in her savings and investments.

She lives on $600 (around £530) to $700 (around £615) a month because she lives very cheaply but doesn’t think she can make it like this for the rest of her life as her savings will eventually run out.

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She also explained to the finance expert that she can’t work due to a neurological condition so she can’t be upright very often.

Betsy invested $100,000 (around £88,000) in an alternative bank which guarantees an eight percent return each year.

Additionally she invested $45,000 (around $40,000) in Vanguard stocks but that has taken a hit this year due to markets being down so she has lost money.

Her emergency fund is around $19,000 (around £17,000) and has $17,000 (around £15,000) in her pension.

Betty receives social security (state pension) but this is around $1,000 a month and covers her rent so she does not include it.

She goes through her expenses each month so she knows what her budget is and tries to stick to $700 (around £615) each month.

Betsy said: “I do these calculations so I can know if I can live 24 months of off my cash before I have to tap into my investments.

“But am I living a pipe dream? Will I be okay?”

Mr Ramsey replied: “Yes you will make it and no it is not a pipe dream.

“It’s the worst possible year to have these investments because the market is down, but most years it is up. It’s an unusually bad economy that we’re in.

“Whatever budget you set, you have to put that into your projections, and if you don’t stick to it you screw it all up. You have to do that or it’s just a pipe dream.”

He explained that in order for her to live off hundreds each month, she needs to be strict with her budgeting.

The personal finance expert suggested that Betsy sit down with a smart-vestor pro to stir the portfolio a little to see if it can do a little better over the long haul.

Mr Ramsey believed she couldn’t do much better with her investments due to the market currently anyway so she has to ride the dip out.

He continued: “There may be a few things you can do with your medical situation like selling stuff online just to add extra cash.

“If you could add $1,000 (around £900) to your monthly budget by working five hours a week doing something online or on the phone, you change the situation dramatically.

“An extra $1,000 (around £900) changes your whole math picture.

“Overall there’s hope because you’re breathing and hope because you’re paying attention.”

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