Have You ever Noticed? (Warning: Dave Ramsey rant) (withdrawing, year, expense)
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I think Mike killed a bull in the bull market once... that is how he got his name. (bad joke, I know.)
Anyway... yea, DR is an entertainer... finance guy to take advice from? Not even close...
He has his purpose. Some people need to be told "Drugs are bad, m'kay?"
He tells those people what they need to be told. He is far from a sound financial adviser for net worth, but the's a good "get out of crisis mode"-adviser. You can't really deny that one. I wish people could see how much his crisis mode advice cost them over 10 years, but most people who are in substantial debt don't look that far ahead, otherwise they wouldn't be in substantial debt.
He has his audience... the financially illiterate of the world. They need him because our schools don't teach basic finance. Is he great? Not by a long shot. Sure beats nothing though.
I've come to accept him as the inevitable evil of a world where personal finance isn't taught in school.
He has his purpose. Some people need to be told "Drugs are bad, m'kay?"
He tells those people what they need to be told. He is far from a sound financial adviser for net worth, but the's a good "get out of crisis mode"-adviser. You can't really deny that one. .
I can deny that one... I just listened to some of his advice from another poster on the forum.
He makes up unbelievable and "feel good" stories for people and then hangs up the phone. Everyone feels so good.
I'm always like hmm.... WTH?
Maybe I've dug myself in too deep on this argument and need to get out... sorry if I believe this guy is nothing more than an entertainer.
Not really. It's designed so it doesn't end up paying out. 3% of term insurance policies on average end up paying anything.
So? All insurance (done correctly by the sellers) ends up being a negative expected value purchase by the buyer. But that's OK in certain scenarios, the "catastrophic" kind where you couldn't absorb the blow w/o the insurance.
If you're purchasing insurance on $50 items, that's a problem... and a whole different scenario.
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It's basically there for if you die early while you still have kids at home.
Yup, and why is that a problem?
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Cash value life insurance isn't expensive when you look at the long term value of it. Even if you have enough to "afford enough cash-value life insurance to provide for your family" the death benefit is still worth having for your family.
It's an easy way to infuse a large amount of cash into your families coffers tax free if you die early, especially if you're the major earner. At the same time it doesn't have an expiration date, so your family eventually gets its monies worth, with a growing death benefit. Again, all tax free.
Do you sell cash value life? There are certain scenarios where whole / cash value life can make sense for people. They're fairly uncommon, especially for average net worth individuals. You just make blanket assertions that it benefits everyone all the time, which makes me pretty skeptical of your posts.
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97% of people get nothing for their term insurance.
And that's OK. It's factored into the low price. See above.
And I hope my family gets nothing from my term policy!
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So for 97% of people pay a little more for a value your family will eventually realize or pay less for nothing.
What's w/ all this 97% scare tactics?
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Originally Posted by Lowexpectations
It only pays out 3% of the time, that's why it's cheap relative to other insurance. It should be a bridge to mitigate risk for most people not an investment vehicle
Dave Ramsey's advice is pretty simple and very conservative. There's really nothing "wrong" about it. Basically, he says become debt free so that you can use one of your biggest wealth-building tools, your income, to invest and make more money. For some people that means just buying mutual funds, for others rental properties and real estate and for others paying for higher education, etc.
Many of my so-called "financially sophisticated" friends who buy and sell stocks and flip houses and buy rental properties with borrowed money haven't always done so well.
Dave Ramsey's advice is pretty simple and very conservative. There's really nothing "wrong" about it. Basically, he says become debt free so that you can use one of your biggest wealth-building tools, your income, to invest and make more money. For some people that means just buying mutual funds, for others rental properties and real estate and for others paying for higher education, etc.
Many of my so-called "financially sophisticated" friends who buy and sell stocks and flip houses and buy rental properties with borrowed money haven't always done so well.
I've gotten interested in buying a small apartment complex for income, and I was amazed at the amount of books out there on such a thing -- however none of them seem to be interested in actual business aspect, just how to get a loan with nothing down and other stuff which I consider faulty logic.
Not sure where to turn for this info that isn't Kawasaki garbage -- or whatever "Idiot Dad" is called.
Dave Ramsey's advice is pretty simple and very conservative. There's really nothing "wrong" about it. Basically, he says become debt free so that you can use one of your biggest wealth-building tools, your income, to invest and make more money. For some people that means just buying mutual funds, for others rental properties and real estate and for others paying for higher education, etc.
Many of my so-called "financially sophisticated" friends who buy and sell stocks and flip houses and buy rental properties with borrowed money haven't always done so well.
Yeah, it seems to have become taboo to pay cash for tenant-occupied (rental) housing these days. Most people in the real estate business think you should have mortgage(s).
If you have mortgages, you effectively have a real estate asset holding >100% of your portfolio, and a negative fixed income security holding. In other words, >100% RE and <0% bonds/cash, because a mortgage (or any debt for that matter) is really just a short position in fixed income securities.
Yet, when financial advisors talk about mutual funds, they seem to think it's unwise to be in 100% stock and to have no bonds.
Does anyone else notice a double standard here? 100% stock is too much, but yet 400% or 500% or even 1000% RE is not?
Yes, I realize you can make a higher return much of the time than your cost of borrowing. However, it's just as true that you can make more return from stock than from bonds, and yet this isn't often used as an argument to hold stock and no bonds, because having 100% stock in a mutual fund portfolio increases volatility compared to, say, 60% stock and 40% bonds. But the same is true for real estate - having 500% RE and -400% fixed income securities, for example, is much more volatile than having 100% RE and 0% fixed income. So why does return become a more important consideration than volatility in the RE case but not the stock mutual fund case? Why should a stockholder decrease stock holding from 100% to 60% and yet a RE holder shouldn't even decrease RE holding from 500% to 100%?
I have spent a huge amount of time trying to understand this double standard, to no avail.
He has his purpose. Some people need to be told "Drugs are bad, m'kay?"
He tells those people what they need to be told. He is far from a sound financial adviser for net worth, but the's a good "get out of crisis mode"-adviser. You can't really deny that one. I wish people could see how much his crisis mode advice cost them over 10 years, but most people who are in substantial debt don't look that far ahead, otherwise they wouldn't be in substantial debt.
He has his audience... the financially illiterate of the world. They need him because our schools don't teach basic finance. Is he great? Not by a long shot. Sure beats nothing though.
I've come to accept him as the inevitable evil of a world where personal finance isn't taught in school.
If listening to Dave Ramsey influences young people to avoid getting into crisis mode in the first place, they will have the luxury of learning how to manage their money for long-term wealth building. And that will be a very, very good thing!
"Those who can do", "Those who can't watch or listen", "those who can't do either, teach". Why wouldn't you consider all advice...financial, physical, situational, mental, etc as just that "advice", before you act? Dave Ramsey is just one person who likes to give out financial advice and for some, he is the guru....for some, not so much.
"Those who can do", "Those who can't watch or listen", "those who can't do either, teach". Why wouldn't you consider all advice...financial, physical, situational, mental, etc as just that "advice", before you act? Dave Ramsey is just one person who likes to give out financial advice and for some, he is the guru....for some, not so much.
Are you REALLY going to get yourself into trouble following Dave's advice? No, and that's exactly the point. While his advice may not be mathematically optimal, it is not harmful, and many people today just repeatedly shoot themselves in the foot financially.
Are you REALLY going to get yourself into trouble following Dave's advice? No, and that's exactly the point. While his advice may not be mathematically optimal, it is not harmful, and many people today just repeatedly shoot themselves in the foot financially.
I would argue his advice is harmful. Very harmful for some people... only slightly for others.
For example, you can't assume (like he has) that someone making 60k will be making 100k in four years.
And then the posts where people have listened to him and made bad decisions and he says "that is not what I meant". Okay...
Now, if he laid out his advice to people on the show, but then followed it up with "free" advice from professionals and listed that detailed advice on a forum, that would be great.
I find it hard to believe you can get financial advice in three minutes.
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