A 24-year-old earning $95,000 called Dave Ramsey with a problem that had nothing to do with money and everything to do with family pressure. Her parents were pushing her to buy an apartment in New York City, even though, as she put it, she had “really never thought of buying or considered it.” She was happy renting. They were not letting it go.
Ramsey’s verdict was immediate: “You’re 24 years old, you make $95,000 a year, and you don’t really want to buy right now. I don’t think you buy right now. Homeownership when you don’t want to is a bad idea. Homeownership when you can’t afford it is a really bad idea.”
He was right, and the same logic applies to anyone weighing a major real estate purchase under social pressure.
Why $95K Doesn’t Go as Far as It Sounds in Manhattan
The caller said she could “reasonably look at anything between $300,000 to $400,000 in the city,” likely a co-op. Ramsey questioned whether that budget was realistic, asking if she was looking at “400 square feet or something.” His skepticism is warranted: the median Manhattan apartment price sits well above $1 million, meaning the $300,000 to $400,000 range puts her at the very bottom of the market.
With the federal funds rate currently at 3.75% and the 10-year Treasury yield at 4.25%, mortgage rates are realistically in the 5.75% to 6.75% range. At those rates, a buyer in her position would face substantial monthly principal and interest payments on top of co-op maintenance fees.
That is only part of the cost. Manhattan co-ops carry monthly maintenance fees covering building operating expenses, property taxes, and staff. Manhattan co-op maintenance fees vary widely but can add hundreds of dollars per month to housing costs, pushing total monthly housing costs well above standard affordability thresholds.
Housing costs above 30% of gross income leave little room for retirement contributions, an emergency fund, or the financial flexibility that matters most in your twenties. The standard affordability threshold is 28% of gross income. After taxes, the squeeze is tighter still.
The Hidden Cost Ramsey Didn’t Fully Unpack: Co-op Fees
A co-op is not a condo. When you buy a co-op, you are purchasing shares in a corporation that owns the building, not the unit itself. Co-op boards can raise maintenance fees, levy special assessments for capital repairs, and restrict subletting. Monthly costs of owning in Manhattan can rise as buildings face insurance premiums, energy costs, and capital repair assessments.
The maintenance fee is not fixed. It can rise, often faster than inflation. The CPI has climbed from 319.8 in March 2025 to 327.5 by February 2026, reflecting ongoing cost pressures across the economy. Building operating costs track those same pressures. A buyer who stretches to afford today’s maintenance fee has no cushion when the board raises it next year.
Who This Advice Fits and Who It Doesn’t
Ramsey’s guidance applies to anyone who lacks the financial foundation for homeownership regardless of what family members want. If you are under 30, carrying debt, have less than a full 20% down payment saved, and your total housing costs would exceed 30% of gross income, renting is the sound choice. Buying does not automatically build wealth. Buying a property you cannot comfortably afford destroys it.
The calculus shifts for someone in the same city earning $150,000 or more, with $80,000 to $100,000 saved, no high-interest debt, and plans to stay put for at least seven years. In that scenario, the break-even on transaction costs can be reached within five to seven years, and building equity becomes genuinely valuable.
The caller does not fit that profile. She is 24, newly employed at this income level, and by her own admission unprepared for the decision. Consumer sentiment, currently at 56.4 on the University of Michigan index, reflects the broader economic caution Americans feel right now. That backdrop makes stretching into an illiquid asset even riskier.
What She Should Do Instead
The money that would otherwise go toward a down payment can do serious work over the next several years. Maxing out a 401(k) and a Roth IRA, building a six-month emergency fund, and investing the remainder in low-cost index funds gives her flexibility and compounding time that a co-op cannot. At 24, compounding time is a genuine financial advantage, and a premature home purchase would consume it.
When she is genuinely ready to buy, the checklist is straightforward: total housing costs below 28% of gross income, a 20% down payment in cash, no consumer debt, and a stable job with no anticipated moves in the next five to seven years. None of those boxes are checked today.
Ramsey also challenged the premise directly: “Why do your parents have a vote?” That question matters financially, not just emotionally. Buying an asset you do not want, cannot comfortably afford, and may need to exit in two years is an expensive way to manage family expectations. Exit costs alone, including co-op board approval for resale and broker commissions, can erase any equity built in the early years of ownership.
Homeownership is a financial decision, not a milestone you owe to anyone else’s timeline. The math in Manhattan makes that clearer than almost anywhere else in the country.
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