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Well, where was he in say 2003 when the mortgage boom began to turn critical? When the regulators told us all: "There is no problem with you taking out 50 no money down stated income loans. What could possibly go wrong?"
What is your point? I'm pretty sure Dave Ramsey was never advising people to take out such loans.
re: People with high incomes paying off debt...yes, it is easier to pay off debt with a higher income. That's no secret. Yet, how many high income people just keep accruing debt and borrowing...and then when one of the spouses gets laid off from their job, they go into free-fall mode because their reduced income can't catch up to their lifestyle?
It seems it is quite rare for people with underwater mortgages to do anything Ramsey-esque, even though he has a lot of followers. Why don't we hear of people who are upside-down simply working extra jobs, selling stuff, and living on beans and rice so they can aggressively attack the debt until they can simply sell (or refi, or whatever they couldn't do as a result of being underwater) their house the normal way?
Lots of people want to lose weight and get into shape too, but they have to commit and do the hard work.
I find the skills and motivation to be a good steward of my finances are the exact same ones that allow me to have gotten to a healthy weight, be quite fit, and stay that way.
It is far easier to whine about being fat or having no money than it is to actually do something about it. So DR yells at people to stop living above their means, but if those people are not deeply committed to change, it is all a waste of sound waves to yell at them.
I don't get it
people that follow the dave ramsey program in it's entirety usually end up needing credit at some point. and since they don't have a credit profile there up a creek without a paddle. DR ignores common sense situations in favor of his theory wich he sells
I don't get it
people that follow the dave ramsey program in it's entirety usually end up needing credit at some point. and since they don't have a credit profile there up a creek without a paddle. DR ignores common sense situations in favor of his theory wich he sells
Are you speaking from personal experience or throwing out your theory?
It's been a long fought battle(especially on this forum).
DR encourages people to pay more interest but DR also gets people to do the steps that get them out of debt. As a numbers oriented guy, I never understood DR before hanging out on City Data. Honestly, coming here has has helped me see the other side, even though I would never personally follow his teachings.
The best analogy I've found is comparing his teaching's to Physical Health. No, DR will never get you ready to run a marathon. If you follow his advise, you probably will never come close to being able to do it. But he will definitely stop you from being that overweight person who can't get up of the couch. He'll keep you mostly healthy and will give you some advice that if you follow, you'll be able to live the rest of your life in some sort of comfort.
When you come to a place like the CD Personal Finance forum, you will encounter a lot of people who can give you much more useful and personal advice. It won't always be one size fits all, but it will usually be better. DR goes the other way, he goes mass appeal. "Mass" is the opposite of "Personal" and it shouldn't be a surprise that there are a lot of people who disagree.
That said, for people who don't come to a personal finance message board, I can't argue that DR doesn't at a minimum get them going in the right direction.
Is North-East ok if you're trying not to go South? Probably. North would be better, but at least they aren't going south. That's how DR's advice works. It's never optimal. He's almost always less than ideal.
But it's hard to argue that he doesn't at least aim those south-bound people in the right general direction.
Dave Ramsey has made millions selling people common sense. But we're in a day and age when lots of people don't have common sense about finances, or don't' have the self-control to handle credit….so he profits from a need in the market.
Should NO one have pizza because someone else can't have just one slice?
He tries to convince people that ALL credit is bad. And IMO, he goes to far with that.
(plus his other advice is usually not reasonable: ONLY by a beater car, or pay cash….ONLY buy a house if you can get a 15 year mortgage)
He's still telling people to use their debit card instead of a credit card…..because he says you have the same protections. He totally ignores any argument that having an account cleaned out -- vs just having a credit card abused -- might not be worth the hassle of using the debit card….vs the credit card. He just says, "there's no reason to have a CC." Yeah right Dave, whatever
Dave Ramsey has made millions selling people common sense. But we're in a day and age when lots of people don't have common sense about finances, or don't' have the self-control to handle credit….so he profits from a need in the market.
Should NO one have pizza because someone else can't have just one slice?
He tries to convince people that ALL credit is bad. And IMO, he goes to far with that.
(plus his other advice is usually not reasonable: ONLY by a beater car, or pay cash….ONLY buy a house if you can get a 15 year mortgage)
He's still telling people to use their debit card instead of a credit card…..because he says you have the same protections. He totally ignores any argument that having an account cleaned out -- vs just having a credit card abused -- might not be worth the hassle of using the debit card….vs the credit card. He just says, "there's no reason to have a CC." Yeah right Dave, whatever
You're not wrong, I've just personally argued that point enough. For me, it comes down to the following key points.
1) CC"s are meant to be paid off each month. If you can't follow that one rule, ignore all other advice, and focus on getting to the point where you can follow that rule.
2) Responsible credit usage is the most valuable financial tool you have
3) NEVER, EVER, UNDER ANY CIRCUMSTANCE use a debit card for a purchase. Either hit the ATM or use a CC. Never swipe the debit card unless it's life or death. It's an absolute last resort.
4) Taking on debt makes sense with the cost of not having the debt is more expensive. If you come out ahead financially with a 30 year mortgage vs renting, then take the 30 year. Run the number. If you can't run the numbers... you should probably take DR's advice. Or learn to run the numbers since that'll help you significantly more in the long run.
>3) NEVER, EVER, UNDER ANY CIRCUMSTANCE use a debit card for a purchase. Either hit the ATM or use a CC. Never swipe the debit card unless it's life or death. It's an absolute last resort.
Why?
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