‘Being broke is a mindset’: New York man says he’s $100,000 in debt, but buys Gucci clothes and books expensive vacations. Is he wrong — or would Dave Ramsey agree with him?

You may think that your status as “rich” or “poor” is based on your bank account. But according to one New York man, those numbers mean nothing.

Big Apple musician Jean-Luc explains how he came to this conclusion on a recent episode of Subway Takes, a one-minute interview show on TikTok that takes place on a subway train in New York City. Host Kareem Rahma kicks off each episode by asking his guests the same question: What’s your take?

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“Being broke is a mindset,” Jean-Luc says. “If more people didn’t think that they were broke, they wouldn’t be.”

Rahma agrees with his take. But soon after, Jean-Luc admits that he has $100,000 in credit card debt (plus interest), yet plans to visit the Gucci store and eat at the iconic, yet pricey, Balthazar restaurant later that day. He’s also booked a vacation to the Caribbean island of Saint Barthelemy.

So is Jean-Luc on to something — or is he delusional?

Rich state of mind

You may be surprised to learn that personal finance expert and radio host Dave Ramsey similarly believes there’s a difference between being poor and living like it.

“Poor is a state of mind,” Ramsey said in a 2018 YouTube video. “I’ve been broke, but I’ve never been poor.”

Ramsey believes that a poor person can have a rich mindset, and a rich person can have a poor mindset. Think of a trust fund baby who spends all their money or a lottery winner who loses all of their winnings.

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But here’s the difference

Where the two men differ is that Jean-Luc wants to feel rich, whereas Ramsey aims to be rich.

Jean-Luc believes that “you don’t even need to be rich to act like it.” He lives this mantra by buying expensive clothes and going on sunny vacations.

But Ramsey believes a rich mindset is one that propels someone to generate wealth. Instead of racking up $100,000 in debt, he would invest the money over the long-term so he could buy clothes and go on vacations free of consequences.

Ramsey likely would accuse Jean-Luc of engaging in “poor people stuff” by spending recklessly, something he vehemently disapproves of.

How to act rich

Ramsey explains what “rich people habits” look like by using lotteries as an example. He quotes a Bloomberg article citing a Bankrate study that says the lowest-income households in America at the time spent $412 per year on lottery tickets, nearly four times more than the highest-income households. For some, winning a jackpot may seem like an avenue out of poverty.

But Ramsey thinks this is the opposite of thinking rich.

“If you put [money] in the lottery you know what you will have at retirement? Nothing,” Ramsey said.

Ramsey explains that somebody with a rich person’s mindset would take the $412 a year normally spent on lottery tickets and put it into a growth-stock mutual fund instead. Doing so over a number of decades could result in a retirement nest egg worth hundreds of thousands.

Ramsey admits he wasn’t always this way. As a young man, his business missteps caused him to file for bankruptcy as he owed millions of dollars in short-term debt. He carries the lessons he’s learned from his experiences.

“If I continued to make those stupid decisions, I’d still be broke,” he said.

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.