Dave Ramsey

[hoosierdoc]

It's worth the sacrifice to only have to deal with my own bodily fluids.

Well that too but I meant you could have chosen to be a plaintiff’s attorney

 

[CHCRandy]

Never have understood the "I am debt free other than my mortgage"......that debt is many times more than all total debt combined, in most cases and has cost you more in interest than all other debt combined. Fact is, we are never debt free. Always will owe someone...whether it's the light bill, taxes, cell phones, insurance. It is stacked against us. The system will insure you owe someone until death.

 

[miguel]

I started listening to him 2-3 years ago as part of my mid-life crisis. In fact, I was just listening to him in the car with Miguel Jr earlier today. It is funny, because he talked about people who modify his plan, which he is not apparently a fan of.

We do about 80% Dave's plan and 20% Miguel's plan and have made super progress, admittedly not as fast as Dave's plan would work, however. I'm not pro-debt, but I am not a fan of beans and rice, rice and beans.

If you are being stupid with money, a week or so of listening to Dave will sober you up quick!

 

[Thor]

I heard him on the radio...but he was preaching to the choir here. Debt free for many a year. Only transient CC cards...because buying on Amazon and ammo sites is hard with cash/check .

I learned a long time ago that credit is no way to fund your life.

 

[HoughMade]

Well that too but I meant you could have chosen to be a plaintiff’s attorney

Defense lawyers can claim the moral high ground of decrying frivolous lawsuits while profiting from them. I like the moral high ground. I like profits. Besides, while the big names and their Bentleys make the news, they are the exception, not the rule.

I'm not the plaintiff lawyer type. I can't convince myself that people who never knew they were "injured" until a lawyer told them they were should get anything.

 

[FearAndLoathing]

I'm trying to pay my house off quick. $85k income no wife or kids. Trying to really watch my spending and stick to my budget. $60k left on house.

 

[seedubs1]

1). Mortgage is $350 cheaper than what I’d pay where I live to rent per month
2). I’ll only pay $20k to the bank over the span of my 15 year fixed rate
3). I’ll have a house at the end of paying off my loan
4). A 15 year fixed rate is so dang low right now, it honestly doesn’t make sense to pay off (I could if I sold some mutual funds) since my investments are making more than I’m losing on my loan

I could be debt free with no mortgage.....but that would be a worse financial decision than having a mortgage.

Never have understood the "I am debt free other than my mortgage"......that debt is many times more than all total debt combined, in most cases and has cost you more in interest than all other debt combined. Fact is, we are never debt free. Always will owe someone...whether it's the light bill, taxes, cell phones, insurance. It is stacked against us. The system will insure you owe someone until death.

 

[patience0830]

How fast xould you rebuild the mutual fund if you didn't have a house payment?

 

[breakingcontact]

He's got some good points.

Overall a positive thing.

Don't listen to him on spiritual advice (which he blends in with the financial stuff).

Every Dollar is pretty good.

 

[CampingJosh]

My wife and I have been debt-free since 2011. It's a good feeling.

We've since purchased several vehicles, a Master's Degree, and much more by saving in advance. We have a decent retirement savings started (about double the median for our age group.) The sacrifice isn't always fun, but I think it's worthwhile.

It's OK to decide that Dave Ramsey's plan isn't what you want to do with your life. I certainly don't follow everything he says as though it's gospel. But if you do what he teaches and stick to it, you will almost certainly have improved financial outcomes.

Never have understood the "I am debt free other than my mortgage"......that debt is many times more than all total debt combined, in most cases and has cost you more in interest than all other debt combined.

It's a secured debt, and it's a secured debt in which you're unlikely to be upside down, so you can be debt-free very quickly by selling the house. That's the difference.

The cost in interest isn't that unfavorable compared to renting. Especially on a 10 or 15 year mortgage.

Fact is, we are never debt free. Always will owe someone...whether it's the light bill, taxes, cell phones, insurance. It is stacked against us. The system will insure you owe someone until death.

Bills are not the same as debt. But I feel like I recall this nonsense coming up in a previous discussion of Dave Ramsey.

 

[1911ly]

I am just shy of 56. House paid for, no car payment. Zero credit cards. Other then utility's, food, insurance and medical bills (will always have those) . I am debt free. My late wife and her mom lived on credit cards. Ugh, no way to live. Those bills are paid. I have 1 boy at home. We aren't rich but we are not totally broke.

I have been trying to teach my boy to live the way I live. If things go as I plan he will have 2 paid for houses when I pass on. And hopefully I won't leave the debit that I inherited.

Debt free is really the way to be. I have really gotten use to tightening the belt when things got lean. I hope my boy does the same.

I have not taken Ramsey's program. But if you are having issues, or are afraid of having issues I think it would be well spent money.

 

[jd4320t]

I listen and I'm working the baby steps but also doing my own thing. I'm not perfect at it and I still by things I shouldn't but they are paid for with cash. People often want to attack Dave Ramsey but he truly does help a lot of people. Most of us are raised to get loans. Get a job, get financed and we can afford it. That is one of the biggest problems in this country. Most people can't really afford anything they buy.

I have a mortgage and a car payment. It's a good car and I'll keep it until it isn't worth fixing anymore. I don't plan to ever have another car payment.

 

[CHCRandy]

It's a secured debt, and it's a secured debt in which you're unlikely to be upside down, so you can be debt-free very quickly by selling the house. That's the difference.

The cost in interest isn't that unfavorable compared to renting. Especially on a 10 or 15 year mortgage.



Bills are not the same as debt. But I feel like I recall this nonsense coming up in a previous discussion of Dave Ramsey.

I agree with most of what you said but a debt is a debt. Let the market go South and see how secured of a debt a 300K house is when it is worth 200K. Look up the definition of debt and tell me how a bill is not a debt. If you owe it, it's a debt. You can't possibly consider a vehicle payment a debt and not a house. Some people call homes investments......I call them a money pit!

 

[BehindBlueI's]

Never have understood the "I am debt free other than my mortgage"......that debt is many times more than all total debt combined...

Because mortgage debt is generally the cheapest debt you can have. The interest rate is typically the best on the market, it reduces your income tax, and it probably reduces your property taxes (although not everywhere). My mortgage interest is significantly less than my gains in retirement accounts. I'd actually be poorer long term to pay off my mortgage vs putting more in retirement.

The Ramsey method is great for people who need a simple bright line system. If you are willing to dive a bit deeper, have good impulse control, then you can do better toward building wealth. I'm also single income, have significant retirement savings (had originally planned to retire as a millionaire at 60 assuming a 7% average return, but since I now have a job with a pension I'm more likely to retire as a half-millionaire at 52), travel, have toys, etc. I do carry debt in the form of two mortgages (primary home and rental) and one car note. I could pay off the car note today, but the interest is low enough I don't benefit from doing it, so I keep plugging money into retirement and my son's college fund instead. Yes, I'd be even more betterer to have not bought the car financially, but you've got to balance living now with your living later.

 

[seedubs1]

Doesn't matter how far the market drops on my house. I'm over 50% paid off, and I plan to die in my house. And my mortgage payment is cheaper than rent. Mortgage "debt" is all the "debt" I have.

It's all a math game. Plug in your down payment, mortgage info, current and projected rate of returns on investments in regards to renting and investing your down payment instead of buying, living expenses if you were to rent, etc... Pick the one where you come out on top in the end.

I agree with most of what you said but a debt is a debt. Let the market go South and see how secured of a debt a 300K house is when it is worth 200K. Look up the definition of debt and tell me how a bill is not a debt. If you owe it, it's a debt. You can't possibly consider a vehicle payment a debt and not a house. Some people call homes investments......I call them a money pit!

 

[CampingJosh]

I agree with most of what you said but a debt is a debt. Let the market go South and see how secured of a debt a 300K house is when it is worth 200K.

Yep. Debt isn't free of risk. House prices dropping more than 20% is quite unusual, which is why PMI is usually required until you have 20% equity.

But Dave Ramsey's reccomendation is not to borrow even for a mortgage.

Look up the definition of debt and tell me how a bill is not a debt. If you owe it, it's a debt. You can't possibly consider a vehicle payment a debt and not a house. Some people call homes investments......I call them a money pit!

Mortgages and car loans are certainly both debts. You have this thing that you will pay for over time.

But stuff like cable, cell phones, electricity? You pay for it as soon as they ask for the money. Unless you consider eating at a restaurant borrowing, it's a silly claim to make.

 

[JettaKnight]

He's got some good points.

Overall a positive thing.

Don't listen to him on spiritual advice (which he blends in with the financial stuff).

Every Dollar is pretty good.

I don't listen to him much, but this statement piques my interest.

 

[HoughMade]

The day I bought my present house, I had almost $200,000 equity in it between the amount under appraised value I bought it (divorce forcing a foreclosure- sad for the people going through it, but great for HoughMade and family) and the down payment. (Ironically, the house is insured for replacement cost which my insurer determined was even more than the appraised value....that's just this side of entrapment for arson). The loan is under 4%. The 2007/8 bubble bursting aside, real estate generally appreciates in value. Since I am not upside-down and barring an apocalyptic event I never will, be, I could get out from the debt rather quickly if I had to.

If you can pay cash for a house, I endorse it, but all debt is not dumb. Debt for a depreciating asset is dumb under most (but not all) situations. Even prior to 2000 when I had a car loan (one at a time), I made sure to put enough down and pay ahead to never be upside-down, or at least try to never be.

 

[FearAndLoathing]

I don't listen to him much, but this statement piques my interest.

Dave Ramsey is extremely religious, and advocates tithing (10% of pre tax income donated directly to the church).

To me, that is insane.

 

[HoughMade]

Dave Ramsey is extremely religious, and advocates tithing (10% of pre tax income donated directly to the church).

To me, that is insane.

I endorse it as well. I guess I'm insane.