Aldeer.com Forums Alabama Deer Talk Aldeer General Forum Dave Ramsey

Thoughts on Dave Ramsey? Wondering how many people follow his steps and how has it worked for you?

He seems to give good advice.

He has absolute rock-solid advice. Some folks will question his investing advice, but that's not his game. He's simply giving the biblical outline for money management, and allowing ZERO margin for negotiation. My experience is he pisses most folks off.

Someone on here is always smarter than Dave Ramsey. Just wait.

Bingo

Nitty and he is a good pitch man.

I figured the snowball thing out before I ever heard of him and it’s good advice. It works if you stick with it and then life is a lot better.
I listened to him occasionally when I was on the road.It boggles the mind how stupid some of the people that call him are.

Our resident credit card guru will be along shortly, to explain how you can make your fortune with credit card debt. 😂💳

You can make a fortune with cc debt, for the card company.

I don't think I am smarter than Dave Ramsey, but I don't understand his recommendation to pay off or avoid zero percent or low percent loans, and instead buying or moving from your savings. I use other people's money as much as I can. I could pay off both our vehicles if I wanted to do so, but both loans are at 1.6%. The worst account I have right now is double that return year to date, even with the lousy market performance this year.

I know a couple who had a Kubota loan at zero percent, and they took his recommendation to get rid of the payment. Pulled $15,000 out of savings to eliminate a $300 payment. That makes no sense to me, as the payoff was the same as the sum of the payments.

Another guy I know wanted a new truck, not a used truck. To avoid dealer/Ford financing at ZERO percent, he took over $50,000 from savings to buy the truck. Said he couldn't stand the thought of having a payment. Just thinking about him doing that made me a little nauseous, but to each their own.

Other things he recommends, like paying off credit cards and avoiding high interest loans are spot on.

i knew that was coming. Surprised he hasnt chimed in yet

Dave's philosophy is to avoid debt. His idea is that any debt is bad debt. I sort of agree in that line of thinking, but I'm with you on zero interest loans.
I can get zero interest on practically anything from John deere and I take advantage of that. Even if my money is only earning 1% that's 1% that I'm making instead of spending.
So I can't see the downside of zero interest loans, unless you're just buying something you don't need.

His paying off debt deal assumes 3 things, in order to make sense (particularly when you're taking from an existing savings or investment account to pay it off):

1. you're paying interest on the debt, otherwise it's a wash
2. the loan interest was greater than the profit you were making from the account the money was sitting in (for savings, that's probably the case. for many types of investment accounts, likely NOT the case)
2. Once you pay off the debt, you take the monthly payments you were making and put it back into savings or reinvest it in something that will earn money

If those 3 things aren't true for a given situation, then pulling from savings or an investment account to pay off a debt may NOT be the best option.

The wild card in the whole deal, though, is Peace of Mind.......for example, our interest rate on our home is low.....like, a hair over 2%. If I came into a large sum of money tomorrow and had to choose between paying off the home vs investing it in something, I'd be leaning really hard toward paying the house off first. Would it be the "right" decision from a purely-financial standpoint? Probably not............but the peace of mind from knowing my home is paid off would likely be "worth" more than the opportunity cost of investing that money elsewhere. (unless the sum of money was great enough that the ROI was enough to cover the house payments, in which case invest it)

EDIT....................................BUT...

All of ^^^that^^^ also assumes 2 things about the individual:

1. They're moderately intelligent when it comes to managing money
2. They're disciplined with their money.

But the people that Dave Ramsey "preaches" to typically don't check one of those boxes......and often don't check either, and are most likely already in money trouble.....in which case his way is probably the only way you'll get out of trouble

Ramsey says this, "80% of what I teach is stuff you should be doing already". It's just basic math but so many people
have such little financial discipline.

I've never read anything from the guy, but the way y'all explain him, it sounds like he just teaches people what their parents should have taught them when they were kids.

That's the other part I failed to mention in what I posted above..............All of what I posted also assumes 2 things about the individual:

1. They're moderately intelligent when it comes to managing money
2. They're disciplined with their money.

But the people that Dave Ramsey "preaches" to typically don't check one of those boxes......and often don't check either, and are most likely already in money trouble.....in which case his way is probably the only way you'll get out of trouble

Pretty much sums it up. It's just sensible fiscal responsibility

You got it. As far as being "tight" with a dollar and avoiding debt , I have folks in my family I bet would make Dave Ramsey look like a rooky .

Big fan and have lived what he preaches before I ever heard of him. The only thing I would disagree with him on is some of his advice on borrowing money for professional education. I've heard him say on more than one occasion that people should not borrow money for professional school or to start a business. If you have proof of concept, then it's bad advice. It would have cost me millions to not borrow money for school and to start a business.

His advice has helped me a lot over the years.