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whitefoot
LSU Fan
Franklin, TN
Member since Aug 2006
7411 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
Auto pay and I have plenty of cash, so mine is not going into a .7% savings account. Again, I'm just pointing out the zero risk scenario. I'm keeping that money in an index fund and turning it into $8-9k.

quote:

you do you, I'll do me

Ok. Then why call me out in the first place?

It's all money to me and I don't care how I accumulate it. If I can make money from something that's going to cost me nothing, I'm going to capitalize on it.
This post was edited on 9/14 at 4:58 pm


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TheWalkoff
LSU Fan
Baton Rouge
Member since Jan 2019
175 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
quote:

Dave Ramsey is full of shite when he says not to have a mortgage on your home.


I think a lot of you on this board are highly misinformed about Dave Ramsey’s philosophy. For starters, he doesn’t say to not have a mortgage, he very often suggests a 15 year over a 30 year.

He will straight up admit to you that his philosophy doesn’t work mathematically, but is more psychological. For example, he suggests paying off the smallest debt first regardless of interest rate. The reason for this is completely psychological and is great advice for the majority of Americans who are undisciplined.

To sort of answer the OP’s question, Dave suggest against having a credit card because studies show that spending cash affects your brain more than swiping the card. In turn, you spend less. So again, mathematically it would be better to get those rewards points, but psychologically you’re likely to spend much less if you only used cash.


greenwave
USA Fan
Member since Oct 2011
3182 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
I dont hate Dave cause I do think he has helped a lot of people get out of debt and I know his target audience lacks self control.

Im a tight wad anyways.


GentleJackJones
Tennessee Fan
VOLS
Member since Mar 2019
954 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
Look, it’s not an one-size-fits all approach.

It’s not good advice for the financially savvy or prudent, but for the “disaster cases” (go stroll around your local Wal Mart or DMV, they are a dime a dozen), it’s sound advice.
This post was edited on 9/14 at 6:28 pm


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Dandy Lion
Georgia Fan
Member since Feb 2010
48508 posts
 Online 

re: Can Someone Explain Dave Ramsey's 0 Credit Score
It can be zero.


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Double Oh
Louisiana
Member since Sep 2008
10700 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
quote:

When a criminal steals your debit card number and wipes it out, they have virtually robbed the bank and took your money out of the vault, it's gone.

When a criminal steals your credit card and runs it up, they only person who has actually lost money is the merchant, not you.

Bank laws.

Yes, some banks are nice enough to extend those protections to your debit card, but they aren't required to.





Most debit cards have a limit on them. Mine does up to $1000 a day.


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AlxTgr
LSU Fan
Kyre Banorg
Member since Oct 2003
68375 posts
 Online 

re: Can Someone Explain Dave Ramsey's 0 Credit Score
quote:

and you’re paying cash for everything
Screw that


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REB BEER
Member since Dec 2010
11983 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
quote:

Dave Ramsey is full of shite when he says not to have a mortgage on your home.


He doesn't ever say that. He simply says your mortgage monthly payment should not be more than 25% of your take-home pay. Seems pretty reasonable to me.

quote:

My family consists of some extremely wealthy people (no shit, probably one of the wealthiest people in the state of Louisiana)

quote:

And they go through hell every time they apply to renew the HELOC's


Why would someone this wealthy need a HELOC?


Brettesaurus Rex
New Orleans Saints Fan
Baton Rouge
Member since Dec 2009
36997 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
Absolutely terrible advice for the common person.

I pay absolutely everything possible I can with my credit card.
1) I control exactly what comes out of my bank account when
2) Always pay it in full and don’t pay interest
3) builds a credit history

I’ve some heard some decent advice here and there from him, but would never follow everything he says blindly.


EA6B
Navy Fan
TX
Member since Dec 2012
10566 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
quote:

Always pay it in full and don’t pay interest


You are the exception in America, Ramsey’s advice s for the other 98% of Americans, previous posters graph of f consumer debt vs savings tells it all.


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TD SponsorTD Fan
USA
Member since 2001
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EA6B
Navy Fan
TX
Member since Dec 2012
10566 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
quote:

Why would someone this wealthy need a HELOC?


It is a practice called “equity stripping” and is used to protect assets of those that have net worth high enough to make them more at risk for lawsuits in the event of some mishap.


jcaz
LSU Fan
Laffy
Member since Aug 2014
6337 posts
 Online 

re: Can Someone Explain Dave Ramsey's 0 Credit Score
Credit is like any other task in adult life.... A necessary evil. There’s nothing wrong with using credit responsibly.

Dave and his minions are a borderline cult.


REB BEER
Member since Dec 2010
11983 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
quote:

It is a practice called “equity stripping” and is used to protect assets of those that have net worth high enough to make them more at risk for lawsuits in the event of some mishap.


Makes sense. Guess I'll never be wealthy enough to worry about it.


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MSUmtowndawg
Mississippi St. Fan
Jackson, MS
Member since Sep 2010
1222 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
My wife and I signed up for a financial wellness class through our church. Turns out its a Ramsey class. Did I unknowingly join a cult? I feel like we could benefit from it by saving more of our play/misc money (really Im hoping my wife sees this as I am a cheapass)

We only have a mortgage and 1 car payment. usually dont carry a balance on the CC. Save(invest/401k) about 18% of our money


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Jag_Warrior
Virginia Fan
Virginia
Member since May 2015
1739 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
quote:

And they go through hell every time they apply to renew the HELOC's because they have zero credit and have to submit shitloads of statements in order to be approved each time


Sorry my man. But I have to call BS here.

How could they have zero credit if they have HELOCs on all their properties??? They may have low scores from being over leveraged, but they definitely “have credit”.

As well, I’ve heard people tout this (so called) asset protection strategy for years. It’s asinine, unnecessary and needlessly expensive. There are much better ways to accomplish the stated goal of asset protection - especially when it comes to real property. Whatever bad advice Dave Ramsey might offer, it doesn’t begin to touch this malarkey.


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FinleyStreet
Georgia Fan
Member since Aug 2011
6366 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
quote:

He doesn't ever say that. He simply says your mortgage monthly payment should not be more than 25% of your take-home pay. Seems pretty reasonable to me.


Your numbers are correct, but he also says you should eventually pay off your mortgage and never have one again. He has that whole "we're debt free!" schtick on every single episode. You must not listen to DR much because he talks about paying off the home mortgage kind of a lot.


REB BEER
Member since Dec 2010
11983 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
quote:

he talks about paying off the home mortgage kind of a lot.



You're right about that. But I was saying that he doesn't expect everyone to buy their first house cash. And most of the time, the debt free scream people still have a mortgage, they've just paid off student loans and consumer debt.

On an unrelated note, I never realized how bad the student loan crisis is until I started listening. It's insane how many people owe $100k in student loans and make like $40k/year.


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dragginass
Member since Jan 2013
1753 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
There seem to be 2 prevailing schools of thought on this board. Max leverage all the time, and moderate leverage. I'm neither.

Someone who is 100% disciplined can provide math that shows their maximizing credit makes them modest money over paying cash.

But my biggest takeaway from DR is that personal finance is more behavior than it is math. More often than not individuals who tout their 0% or low interest loans fail to invest as they claim and merely freely spend elsewhere.

There is absolutely something to be said for not owing anyone anything. DR is right, the grass feels different. Particularly in retirement, I don't know anyone who looks forward to the peace of mind that a large mortgage provides for them to invest.....


Jag_Warrior
Virginia Fan
Virginia
Member since May 2015
1739 posts

re: Can Someone Explain Dave Ramsey's 0 Credit Score
Very well put.


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