Any Dave Ramsey fans out there

W

Wulaw Horn

1,000+ Posts
Anyone actually been through or working through his program?

I want to get on board and it pretty much sums up reasonably well my views on money- but being self employed and having my income sometimes a dicey proposition the idea of putting my savings into student loans at like 2.5% is scary to me and seems kind of unnecessary.

I get the point that the debtor is a slave to the lender and bills keep you from doing what you were born to do as you sell out for money- but was just wondering if anyone has been through it to the other side and if so how their journey went.
 
big fan here. If you wish, I imagine you could get your 4-6 months of emergency fund together before tackling the 2.5% interest.

Not gonna kill you either way.
 
His Financial Peace University turned my life around. His steps work. I was $37,000 in debt when I started. When you come through the other side, you realize how much of what he teaches is common sense: Create a budget, stay debt free, no credit cards, live within your means, use your income to create wealth.

I've got my parents doing it now. They're not doing well on it because they refuse to budget. No point in going through the program if you refuse to live within your means.
 
OC- that's what I would think- but everytime he takes a phone call with someone asking him a variation of that question he says you have to do it in order, they are in order for a reason.

Seems like a big leap of faith to me withi irregular income. I think the reason he wants you to spend your bigger emergency fund is to motivate/scare the crap out of you. I don't know that this works in my case.

I gave his book to my folks for xmas and said I'd pay for FPU- they haven't taken me up on that offer yet. I want to go to FPU but not sure if that happens or not- definately want to see him at a live event.
 
I'm a big fan of his ZERO debt line of thinking. I'm not a big fan of the "all credit cards are evil" thought. If you are resonsible about your credit card AND pay it off every month I don't see the problem of having, let's say an AMEX card.

I love his idea of savings and having an emergancy fund set up. Most people don't have this and THINK they can't start.

I like how he gets people started on saving for retirement. I don't like that he only thinks no-load funds are the way to go.

His thinking goes against what our society wants you do to, which is spend, spend, spend, and be a 30K millonaire. Overall I really like his message. Most people would do well to follow his advice.
texasflag.gif
flag.gif
 
There are tons of talking financial heads out there. The vast majority offer a small nugget of truth but are generally full of ****. (That Rich Dad/Poor Dad guy comes to mind.)

However, there are two people that are right on the money.

1. Dave Ramsey
2. Suze Orman.
 
I have listened to his audio book/cd. His point per the credit cards is that we spend more than we normally would with a CC than we would with cash. Ie, using cash makes you consider 'should I spend $200 at Banana Republic or should I not'. It is easier to use your credit card than drop 10 $20s down. Even if you pay off your credit card every month, you are spending more than you might otherwise.

I agree with him but we have yet to get there. We are debt free other than our mortgage and paying that off aggressively. But it is very hard to get away from the convenience of the credit card. We have thought about just using the credit card at places like gas and HEB. And cash for everything else including going out to eat and shopping. But it is hard to. We would likely spend less if we did so but it is hard.
 
A pretty big fan here. Big picture is that on a single income, the family has managed to get debt free and pay off the house. (We are both 38, married at 21)

Oddly enough coming out the other side of paying off the house has been a struggle as now we have more disposable income and we have to manage it on different wants....

Never had any real debt trouble, but needed some financial direction. Take everything with a small grain of salt. I personally think he gets closer to the truth than anyone else out there.

One thing he doesn't really discuss is how to get more for less. Where are the best places to save money? What should you learn to do for yourself that you used to be afraid of? If you are really sticking to it, you learn how to be creative. There can be some enjoyment in this if you take it as an opportunity to learn and expand your horizons instead of the required drudgery of 'the plan'. The further in debt you are when you start, the more drudgery to be expected.

Good Luck
 
Dave Ramsey teaches you how to live comfortably. He does not teach you how to get rich. If you just want to live a happy, comfortable life... you should follow what he preaches. If you want to get rich, you ignore 90% of what he teaches. I personally fall somewhere in the middle.

Take the guy above with student loans at 2.5% interest. The way Dave sees it, that debt is bad. The way I see it, paying off that debt quickly is stupid because even inflation is higher than 2.5%.... therefore invest the money and make a better return.... even if just in a CD or online savings account where you can make 5%. In other words, you are using someone else's money to make yourself an extra penny.

Having said that, you have to be very careful. We could have avoided the ENTIRE sub-prime mortgage and credit crisis if we all lived by the rules of Dave Ramsey....

This is a new financial/economic era we are entering. The US will no longer be the world's finanical power. It will simply be a major player along with the EU, China, India, Japan, Brazil, etc.
 
I am a fan. The people that he is helping are in dire need of someone like him. Too many people live way beyond their means. I do disagree that all credit is bad A smart consumer can take advantage of banks and credit card to their benefit. But realize that few are smart about it and get in trouble. Dave understands what most people don't in that money is not always pure math there is so much psychology in it.

I also disagree that you need or should pay a broker to buy a mutual fund. You can do better performance wise at Vanguard or Fidelity etc.
 
Fan here too. Smurfette and I have gotten completely out of debt (except for cars) and are well on our way to being able to build a house for ourselves. In the 18 months we were paying off debt we were still able to pay for a wedding, get our dog heartworm treatments and make about $2500 in car repairs. We're prepared, and that's a helluva lot better than where we were before.
 
Funny dave moment the other day- I guess showing I haven't bought completely in yet..

I was at the supermarket and buying a loaf of bread ($1.52). I opened my wallet and saw $250.00 in it, all in crips $50's. I thought about it, looked at it and decided, no way am I putting my $50.00 bill in the machine and getting back $48.52 in change in $5.00 bills and $1.00 bills and coins. So I ran through the Amex.

I haven't gotten rid of the amex yet. I have to pay it every months, it's for the business for the most part, and I try to stick to only "essentials" like Gas, Equipment orders etc.

But I didn't want to get back like 10 bills in change to replace 1 bill, so I amexed the loaf of bread. I don't think Dave would have been proud, but it is what it is.

I wonder if he's really that fanatical or if it's just to prove or if it's just to prvoe a point b/c 94% of his listening audience is too poor to pay attention as he likes to say.

I understand the point about what the above poster is saying about him being for living comfortably not super wealthy. I think he'd respond that there are tons of superwealthy people that never took on any debt on their way to wealth, and without taking on debt you have basically minimized all your risk.

I think that's what he's really about (and remember he's coming at this from a ministry perspective). Make your life happier by minimizing all your risk (no debt), living on less then you make (so you can save), buy your insurances (health, life and nursinghome when you hit 65) and then you can go do whatever you want with your life.

But being where I'm at right now I'm having a hard time, like I said, getting on board with using all my saings to pay off a non-consumer debt with a locked in interst rate below inflation. But the other part of me hates that debt against me.
 
I found Dave too late in life unfortunately. My wife and I are completely debt free and own our home, but it's because we've been married 35 years, not because we're smart sumbitches.

I will say this though, part of my dumbassery came into play about 20 years ago when my State Farm agent sold me a whole life insurance policy. It's completely paid off and self-sustaining, but Dave really opened my eyes to that. This week, I'm finally going to take the cash surrender on that policy and put it into a mutual fund. Then I'm just gonna buy a level term life policy each year with the earnings from the mutual fund. And - the term policy will have a value 5 times more than the whole life to begin with. That's the kind of stuff that Dave got through to me. Whole Life insurance Sucks.

I can only comment that more of what Dave says is true than not true. My wife and I absolutely only use a debit card now, never ever will use a credit card again. If we don't have it in cash - then we're not buying it.
 
Yes, you can take the student loan money and invest it. But Dave is trying to keep it simple...he's establishing a mindset.

The emergency fund establishes a pattern of saving and living within your means. And it gives you something other than credit cards to fall back on.
 
frankly, if you are worrying about a 2.5% student loan debt vs a 5% money market account and that is it, you are probably not the core consumer of Dave Ramsey's advice.

His show is geared toward helping those people who have gotten in over thier heads or are about to be in too deep. I love the stories of people gaining control and his "beans and rice rice and beans" schpeal is really refreshing. The fact that some of his callers and listeners are so far in debt and not willing to make that sacrifice is mind boggling to me.

Yes, it is personal finance 101, but I really do think he is helping people regain control of their lives.

I did not use the debt snowball, per se, but over the past 8 years, my wife and I have paid off:

a high interest student loan (8%)
2 car loans
credit card debt
and this year, we completed paying off our house. We still owe a mortgage on the house we live in as we have been unable to sell the previous house yet. However, when that house sells, we will be debt free not including the requisite 2.5% student loan.

I would recommend the Dave Ramsey program to anyone as paying off the smallest loan first really does make you feel like you are making progress.
 
I had been meaning to check out his new show on Fox Business, but with all of these glowing reviews of his advice, I'll definitely set it to DVR this week.
 
Another thought to add to the note above: Take out $X in cash every Sunday as an allowance. If you go over that amount you cant spend/get anymore money. It really helps you maintain control of a budget because you realize how much you are spending on things like sodas at a 7-11 or Starbucks or whatnot.

Try it for a few weeks.
 
Ramsey and Orman and those like them are good for consumers/individuals/employees. Their advice is terrible for business people. Debt can be an extremely powerful and positive tool for business. Example of a friend who is a Ramsey follower -- won't borrow $80,000 to open a new location of a well branded and established store (franchise essentially) and doesn't have the cash. In two years, the store would generate enough cash to pay off the $80,000 if she was aggressive in paying down the debt. Still no dice. She's going to fore go a 50% increase in net profit because she doesn't want to borrow the money. It's just plain stupid.

Now, personal expenses, that's a whole other ball game.
 
You must log in or register to reply here.

Weekly Prediction Contest

* Predict HORNS-AGGIES *
Sat, Nov 30 • 6:30 PM on ABC

Recent Threads

Prediction Results Threads

2024 Schedules

Back
Top