Unpopular Opinion: I don't like Dave Ramsey

fwafwow

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This is correct. He also pushes paying off the mortgage because for the majority of people don’t benefit from having it and would benefit more from having that house payment used in a different way.

He has also done an extensive study on Milionairs and the majority of them say pay off your mortgage.

I would be interested in seeing his study on millionaires. In my experience, there isn't much correlation between aggregating wealth and having financial acumen. Also, if millionaires say pay off your mortgage, would the audience benefit in knowing that many millionaires (and wealthier folks) very often use debt, including on their homes? I'm not saying that Dave's advice about paying your mortgage is wrong, as many can benefit from taking that step. But just because some benefit from the advice doesn't mean that advice is right universally. I'm not calling for pitchforks, I just would prefer he explain the pros and the cons on various issues and then let the audience decide which is the best path.
 
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I would be interested in seeing his study on millionaires. In my experience, there isn't much correlation between aggregating wealth and having financial acumen. Also, if millionaires say pay off your mortgage, would the audience benefit in knowing that many millionaires (and wealthier folks) very often use debt, including on their homes? I'm not saying that Dave's advice about paying your mortgage is wrong, as many can benefit from taking that step. But just because some benefit from the advice doesn't mean that advice is right universally. I'm not calling for pitchforks, I just would prefer he explain the pros and the cons on various issues and then let the audience decide which is the best path.
He does explain it. You would have to listen as they do extensive research of millionaires and they have books showing it. It is called Everyday Millionaires. Chris Hogan is his guy that covers all of that.

They even have Everyday Millionaire hours on his show where those are the only calls they take. People who have a net worth of 1 Million or higher and they talk with them about how they did it.
 

Salmon River Solutions

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I've tried doing the Dave Ramsey stuff but never really bought into it. For now tho, the wife and I make decent money and we're happy.

If I was following his stuff strictly I would have never refinanced + cash out in order to start my machine shop. Yes, I have more overall debt, but I'm happy being able to design, manufacture, and sell my own products.
 
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The other thread got me thinking and I'm just wondering if anyone else feels the same. I'm just stirring the pot a bit, but I love talking finances.

Anyone else here despise Dave Ramsey's advice for people with a handle on their finances? I can't imagine I'm the only guy, I'm sure it's an unpopular opinion but here are my main reasons.
1.) His early advice is good for people struggling, but he's snake oily to me when he talks about using only his endorsed local providers including financial planners (which have no fiduciary responsibility to their clients) or real estate agents. You think his trusted "partners" actually do anything other than pay his company for that certification? They end up getting paid more when they pick high commission funds (less money for you)
2.) He advises against ETF's even though they generally beat his mutual funds when you include fees all f-ing day.
3.) The way he treats people with different opinions of his is ridiculous. They're an idiot or a moron if they don't think his advice is gold.
4.) His opinion that essentially all debt is bad other than your personal home. I have a ton of mortgages on investment property that pay me every single month, couldn't purchase them without debt.
5.) You likely won't get 12% returns in the stock market, especially with his mutual fund ideas when you count fees.
6.) Credit cards are not evil, personal control is. I could take my family to Hawaii every year on credit card rewards just from my business on things I need to spend money on.

People who he's great for.
1.) People struggling with their finances.

He'd tear apart my portfolio, but my net worth would be about 30% of what it currently is if I would've went his route 4 years ago instead of buying my first rental. I'm a much bigger fan of the choose FI, biggerpockets, bogleheads, or mr money moustache train of thought.
Does anyone really like him
 

fwafwow

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He does explain it. You would have to listen as they do extensive research of millionaires and they have books showing it. It is called Everyday Millionaires. Chris Hogan is his guy that covers all of that.

They even have Everyday Millionaire hours on his show where those are the only calls they take. People who have a net worth of 1 Million or higher and they talk with them about how they did it.
Is the study made available - only by reading the book?
He does explain it. You would have to listen as they do extensive research of millionaires and they have books showing it. It is called Everyday Millionaires. Chris Hogan is his guy that covers all of that.

They even have Everyday Millionaire hours on his show where those are the only calls they take. People who have a net worth of 1 Million or higher and they talk with them about how they did it.
Is the study published, other than in the book that’s for sale?
 

Crghss

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I bought a house 11 years ago with 30 yr mortgage. But I paid extra and will have it paid off in 3 more yrs. sounds great right?

If I’d taken the extra money I paid to the mortgage and invested in stock market instead, I’d be able to pay off the house and have extra to boot. hindsight is 20/20 but not all debt is bad.

So you guys buy your cars with cash? No loans?
 
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So you guys buy your cars with cash? No loans?
That is how we do it. We plan ahead for when we feel like we need to buy a car and start putting cash aside. I haven’t had a car payment for 10 years or so and would never have another one.

Starting next spring we will start saving for my wife a new used car. Probably a 2019 or so. We will save up around $25k
 

hunter4life

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Some of you guys on here act like investments never go down. See the above post #69. If you had bought that car with a loan in late 2007 and invested the rest of the money in the stock market at the same time you would have been underwater for the next 5 years. The market has ups and downs and over the long-term does very well, not always in the short term however.
I think Dave Ramsey has good advice for getting out of debt and that is his target audience. I don't strictly follow his advice, but I am not in a situation where I need to.
 

KH_bowfly

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Lots of good points given in this thread. A couple of other thoughts that are worth what you paid me for them:

I’m a math type and disciplined, but my wife and I chose to more-less follow the Dave Ramsey plan for getting out of debt after we got married and combined finances.

Even though I’m plenty disciplined and know how the math works, it was important that we were on the same page and both pushing towards the debt free goal. It doesn’t do any good for one to be focused with the other not on board. That was worth a lot to us and it’s probably good in some ways that I wasn’t preaching the math, but we let Dave do some of the talking.

There’s also some real psychological advantage in being 100% debt free. It was really difficult for my brain to let that happen. It was a huge challenge for me to agree to pay off a 0% interest vehicle loan two years early... However, I now think the feeling of being debt free outweighs a bit higher dollar gain on my retirement accounts. The plan is to have plenty before actually retiring anyways and why add stress that could shorten life?

I think everyone should follow the path that helps them keep their sanity. My $0.02.


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EastMT

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66% of Americans live check to check. That’s because of loans, not expenses. The people he’s talking to don’t have 25k to invest, they need a life style change and they aren’t going to get it done alone. The cost of living really isn’t that bad without loans.

2/3 of us yapping on here are flat broke, zero savings. Probably should be buying an igloo instead of a yeti!

If you have 25k, loan at 1.9%, not gonna hurt you. If you don’t have 25k, then you don’t need a new car, get a damn civic! Got 350,000 out of that beater for $2500!


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I like Dave Ramsey, don't agree with everything he says, particularly holding off contributing to a 401k or IRA until you have paid off everything but your home. When I was just starting my career back in the 90's I read The Millionaire Next Door and became obsessed with accumulating wealth and I have ever since. For about 2.5 decades now my wife and I lived well below our means and after about 20 years we no longer had any logical need for debt. Was it fun early on, no it sucked. Anyone who says they enjoy debt has never really lived without it. Straight cash homey!
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ChromeKype

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I bought a house 11 years ago with 30 yr mortgage. But I paid extra and will have it paid off in 3 more yrs. sounds great right?

If I’d taken the extra money I paid to the mortgage and invested in stock market instead, I’d be able to pay off the house and have extra to boot. hindsight is 20/20 but not all debt is bad.

So you guys buy your cars with cash? No loans?

Paid cash. Two cars and a raft.

I’m the kind of guy who is pretty smart but need the kick in the pants weekly by Dave to stay on the straight and narrow ( living below my means). Love guns and gear.

I did sell my tundra as it had equity and downgraded to a Honda Odyssey.


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ChromeKype

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Dave didnt make any of that possible. You paid off 60k in debt this year because you make way more that the average person (the average person does not even make 60k in a year) and made the right decisions.

Thats one reason I do not get into these Dave type people. They dont have some big secret. They just tell you what you should be doing. People know what they should do they just dont want to. Eventually people get so into the hole they realize they effed up and seek out help to do what they already know they should be doing.

Dude We’d still have that debt hanging over our heads if it wasn’t for listening to Dave and my wife and me getting on the same page. We do make more than most but I’m telling you right now 60k in a little over a year took blood, sweat and tears. That’s 5k a month grinding. Now we can build wealth, instead of building JP Morgan’s wealth.


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Marble

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The other thread got me thinking and I'm just wondering if anyone else feels the same. I'm just stirring the pot a bit, but I love talking finances.

Anyone else here despise Dave Ramsey's advice for people with a handle on their finances? I can't imagine I'm the only guy, I'm sure it's an unpopular opinion but here are my main reasons.
1.) His early advice is good for people struggling, but he's snake oily to me when he talks about using only his endorsed local providers including financial planners (which have no fiduciary responsibility to their clients) or real estate agents. You think his trusted "partners" actually do anything other than pay his company for that certification? They end up getting paid more when they pick high commission funds (less money for you)
2.) He advises against ETF's even though they generally beat his mutual funds when you include fees all f-ing day.
3.) The way he treats people with different opinions of his is ridiculous. They're an idiot or a moron if they don't think his advice is gold.
4.) His opinion that essentially all debt is bad other than your personal home. I have a ton of mortgages on investment property that pay me every single month, couldn't purchase them without debt.
5.) You likely won't get 12% returns in the stock market, especially with his mutual fund ideas when you count fees.
6.) Credit cards are not evil, personal control is. I could take my family to Hawaii every year on credit card rewards just from my business on things I need to spend money on.

People who he's great for.
1.) People struggling with their finances.

He'd tear apart my portfolio, but my net worth would be about 30% of what it currently is if I would've went his route 4 years ago instead of buying my first rental. I'm a much bigger fan of the choose FI, biggerpockets, bogleheads, or mr money moustache train of thought.
Ill disagree. I dont find him snake oily, but I do agree on some of the things you say.

His advise is based a lot on the study of financially successful of people who became wealthy. He would call them everyday millionaires.

You can pick several things he suggests that in certain circumstances aren't the best. And the point that people with a smart financial mind can make good decisions is I think spot on. But his advise isn't for those people. And those people are a small percentage.

Wealth, debt and financial freedom are based on behavior. And that's what he helps people with. Changing behavior.

It is amazing to speak with people who have no idea what or how interest is. How investments work. Why credit cards are dangerous. Etc.


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Do we pay cash for vehicles, absolutely. For over a decade I drove a 1991 civic and my wife drove a 2002 Taurus, both bought with cash. In 2015, we sold the civic and paid cash for a 2015 odyssey for my wife. At that point I started driving the Taurus and we let our investments grow. In February of this year I was able to order a 2020 raptor from the factory which I now drive; 100% paid with cash. The Taurus is sitting in the driveway, probably will sell it to someone for $1. We will be moving into our new custom house on 45 acres right at the first of the year, all paid with cash. Once we move into the house, we will be ordering a 2021 F350 Lariat Tremor for my wife (cash as well)to pull her horse trailer, but we will keep the odyssey as a daily driver. I really don't believe we would have been able to accumulate this type of wealth if we would of had to use our income for the perpetual consumer debt cycle. The most my wife and I have ever earned in a year was $135,000. One final note concerning super low interest rates on auto loans; you all do realize that to get such a low rate you end up paying a higher price for the car?
 

Ralphie

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I mostly like his plan.

It cracks me up though when someone calls up that wants to be a MD or lawyer. Dave has no real plan for a normal person to pay for that kind of college. If all of them followed his advice I doubt we’d have any drs or lawyers.

I like the millionaire theme hour but one thing they all gloss over is debt DID play a role in 99% of their net worths because they all count their homes, that once had a mortgage.

Also, the vast majority of his millionaires had much higher incomes than normal folks. But then again having a high income is also part of his plan.

It is a little funny to me that several of the complaints on here about him are because he’s a big meanie.
 

Rich M

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The other thread got me thinking and I'm just wondering if anyone else feels the same. I'm just stirring the pot a bit, but I love talking finances.

Anyone else here despise Dave Ramsey's advice for people with a handle on their finances? I can't imagine I'm the only guy, I'm sure it's an unpopular opinion but here are my main reasons.
1.) His early advice is good for people struggling, but he's snake oily to me when he talks about using only his endorsed local providers including financial planners (which have no fiduciary responsibility to their clients) or real estate agents. You think his trusted "partners" actually do anything other than pay his company for that certification? They end up getting paid more when they pick high commission funds (less money for you)
2.) He advises against ETF's even though they generally beat his mutual funds when you include fees all f-ing day.
3.) The way he treats people with different opinions of his is ridiculous. They're an idiot or a moron if they don't think his advice is gold.
4.) His opinion that essentially all debt is bad other than your personal home. I have a ton of mortgages on investment property that pay me every single month, couldn't purchase them without debt.
5.) You likely won't get 12% returns in the stock market, especially with his mutual fund ideas when you count fees.
6.) Credit cards are not evil, personal control is. I could take my family to Hawaii every year on credit card rewards just from my business on things I need to spend money on.

People who he's great for.
1.) People struggling with their finances.

He'd tear apart my portfolio, but my net worth would be about 30% of what it currently is if I would've went his route 4 years ago instead of buying my first rental. I'm a much bigger fan of the choose FI, biggerpockets, bogleheads, or mr money moustache train of thought.

Why should you worry about him?

If other guys want to toot the D. R. horn, let em.

I don't agree w Ramsey either and used to teach his stuff. Some of my students had issues. I did stuff diff when recovering from catastrophic job loss, moving for work, watching that company fold too, and the resulting climb out of the pit. Doesnt mean the guy is bad, just that we don't agree w some teachings.

Thing is some folks just need help and a place to start. Start a budget and following it is tough for some - need to follow some kind of plan.
 
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