the hell you say??? so, let’s just throw out all the solid advice he gives out (as i have heard him say “the advice your grandparents would have given you”) and just dismiss all the good he has done. in fact,
I've discussed this with people who have more letters after their name than I do. Ramsey does not recommend to pay off the mortgage per se. He recommends eliminating all debt except that one, but also to possess a mortgage you can truly afford. 15 year fixed that is no more than 25% of your net pay. You invest once you reach the debt level of only a mortgage. I disagree with this as well, but he does cater to those individuals who can't get a grip on finances. Using emotions is what works for those people.
Couldn’t disagree more with you. I was basically doing what you were saying, servicing debt to have money in the stock market. I was gambling with money that wasn’t truly mine, and so are you. The realization hit me like a lightning bolt. The market will rise and fall but my debt is (was) concrete. Could you pay off all your debt if you wanted today?
Also, even for the disciplined, if a bear market arises, your plans are sunk!
I know a ton of people like this. How many times have you seen guys in the PX “selling to pay for X Y or Z bill”. Buying toys isn’t an investment strategy.
Agreed. I pay off my credit cards every week but my wife and I use a cash rewards card for every single purchase we make. Over the course of time it adds up. Over a single year, I bought an AXMC just with reward money from my credit card. I also disagree with him not taking out a mortgage and buying a house with cash. That’s just not feasible for most people. I also leverage my assets for investments that I want to make. He would strongly advise against that. But overall, he offers simple no BS advice that most people would greatly benefit from.
I don’t think toys should ever be thought of as investments unless it’s rare art or rare cars...lol. I have been investing since high school and some do those accounts that had a measly 2k in 1996 are worth almost 80k now. I seriously doubt many rifles or guns can do that. But you also have to enjoy life. You can’t be worried about investing every penny for future growth. Live a little.
Buying toys isn’t an investment strategy.
Not losing any money? At today's going rate, you'd be hemorrhaging money.I’m not saying you aren’t smart with money. Don’t know your situationis your risk tolerance or your time line to “retirement”. You shouldn’t care if the market rises or falls...unless you are going to or have began to harvest your assets.
His bankruptcy was the genesis of his whole system. Before, he was leveraging debt, flipping real estate, and using “other people’s money”. That’s what led to his bankruptcy.
Your not Financial Free at all in this country as long as the fiat money system is still in place. Make silver money again!
I never understand the reasoning behind people that make posts like this. Are you people bankers that are losing money on people that are debt free?
I agree financial planning should be specific to the client, but your statements are utterly ridiculous. Seven figure incomes don't qualify for a ROTH and there's nothing in Financial Peace that resembles a cult. Ramsey gives solid advice to his target demographics and I know a good many seven figure earners who would benefit from the fundamentals of his program.
Nope. Dave's plan makes my life easier. No tailored tax plan and no liability if something goes awry. Like I said, I'm flat fee. I probably care about this more than I should.
What's ridiculous? True, the AGI limitation for ROTH contributions is $135k ($199k MFJ,) but there's a loophole commonly referred to as a "back door" ROTH contribution that allows ineligible taxpayers to make a non qualified contribution to a traditional IRA and immediately roll it into a ROTH account, creating a situation virtually identical to if they had contributed to a ROTH directly in the first place. This is a common practice when the pro rata rules don't come into play. It's not some wacky scheme I came up either. It's all over the place.
After reading and re reading your post I can’t really track with you on parts of it. As someone that was part of that program and one that thinks there is benefit for many, your last paragraph seems to walk that back. I can’t see the specific damage being done to the other 20 percent.
Hey brother, thanks for the reply and your additional detail helps. Not sure we are all that far apart. Do I agree that low cost money is the place to dump discretionary funds? The exact math would say “no” depending on the opportunity cost of other investments. Ramsey or not I think the place I separate from the pure math of those static equations ties back to the cost of risk and ones associated risk tolerance. For any given leveraged investment there is a cost associated with that risk. It’s that specific risk that i have never found to be calculated with any long term high degree of accuracy. And, for many it’s too easy to under estimate that. Granted, some of that cost of risk can be offset when tied to the risk of doing nothing. But I don’t think that is what we are talking about.
The risk lies in the individual investment more so than the investment vehicle. For example, If you were dead set on investing your entire life's savings into tesla that's fine. It's not my department and not my concern. I'm more concerned HOW you buy that tesla stock. Is it going to be in a cash balance plan? A ROTH 401k? A regular brokerage account? If you're young and not making much, the ROTH is a home run. If you're old and crushing it that's probably a terrible idea. If you value liquidity and don't mind paying Uncle Sam to preserve that, a brokerage account is probably the way to go. This is where Ramsey falls short. Everybody gets crammed into the same box. Some times it fits, other times it doesn't. My client base is disproportionately wealthy, so maybe the 20% is high. It's a made up number anyway.
99% of our population would be best off following Ramsey’s plan? Hahaha. That’s some serious koolaid.
1% ‘er doesn’t mean anything. People are people, period. $10k or $1 Mil+, people tend to spend somewhere near or above the threshold of their means. They also tend to think they are somehow smarter than everybody else
. It the reason marketing works, it’s the reason there is a credit system. Debt can be a tool, but it is always a prison, and should be viewed at best a necessary and temporary evil. I’ve done it both ways. I’ll never put myself back in prison if I can help it. 1% ‘er doesn’t mean anything. People are people, period. $10k or $1 Mil+, people tend to spend somewhere near or above the threshold of their means. They also tend to think they are somehow smarter than everybody else
Debt and living above one’s means are why you can’t tell your boss to piss off when they demand you take a vaccination you don’t want.
