Couple racked up over $20,000 in credit card debt, but ‘I feel like I’m rich,’ husband says

David, 33, and Halima, 37, have nearly $520,000 in debt.

But, “I actually feel like I’m rich,” David told self-made millionaire Ramit Sethi on his “I Will Teach You to be Rich” podcast in December. Their last names were not used.

The couple earns a combined $192,528 a year and the mortgage on their New Jersey home makes up the majority of their debt. They came on the podcast in hopes that Sethi could help them figure out how David can retire early.

Here’s a look at their finances at the time of the podcast recording:

• Assets: $524,000
• Investments: $11,249
• Savings: $63,752
• Debt: $517,045
• Net worth: $80,956

Their debt includes their $447,000 mortgage, as well as $47,144 in auto loans and $22,900 owed on credit cards.

A number of red flags left Sethi concerned not only that the couple won’t reach David’s early retirement goal, but could face even more financial turmoil if they don’t change their attitudes and habits with money. 

As Sethi told them, “You make a lot of money but you don’t make that much money.”

Here are three money missteps that helped push David and Halima into the red and how Sethi recommended they work their way out.

David and Halima both navigated their way out of dire financial situations earlier in their lives, which is part of why they feel good about their finances today. Owning a home was like a dream come true.

“Buying a house was instilled in me,” Halima said. “Growing up, it’s like you have to get married before you have kids, buy a house — it’s the American dream, that’s why my parents came [to the U.S.]”

But Sethi said that dream doesn’t have to be everybody’s goal. He asked Halima what comes after the “house with the white picket fence,” and neither she nor Sethi had the answer.

“So many of us are following money stories that someone else wrote for us and they didn’t even finish it,” Sethi said. “Don’t just follow the idea that someone else created.”

What David and Halima were really looking for in buying a…