- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
re: My experience Interviewing for Dave Ramsey
Posted on 11/19/15 at 8:01 am to anc
Posted on 11/19/15 at 8:01 am to anc
quote:
In fairness, his method for getting out of debt works. But once you are out of debt, it just isn't the best method.
What do you mean by this exactly?
I am a Dave listener and started his debt snowball in April of this year after a buddy recommended it. I really like his getting out of debt plan aside from the cash envelopes system. Debit cards are just fine. But I'm definitely not a cult-like follower. There are so many things that I disagree with him on. First of all, the $1000 emergency fund is an absolute joke. It's just not practical in 2015. Secondly, I disagree with him on credit cards. I have 2 that I pay off every month. I understand why he says credit cards are dangerous or whatever, but that doesn't apply to me. I'm not the kind of person that will run up an ungodly amount of credit. Just a couple hundred here and there. The third thing is that I'm not stopping retirement while getting out of debt. Just have agree to disagree on that one. And lastly, I don't exactly agree on his investing strategy. The fact that he says he earns an average return of 12% is just folly. I listen to other podcasts for investing advice.
The story in the OP just confirms my opinion of Dave as a person. It doesn't take but 5 mins of listening to his show to know he's a pompous prick. I was given the FPU cd's and a torrent download of his book by a couple friends. So it makes me feel good knowing that he hasn't received a dime from me. And I have no desire to call into his show to scream I'm debt free
. But I am surprised about the no health insurance part at work though. Wow...just wow So I agree with most of the people in this thread. He's a money hungry individual for sure and mainly cares about furthering his brand, but at the end of the day, there's much worse people out there. I've listened to pretty much every show since March because it can be inspiring hearing people's stories. Just don't be naive and believe every word he says as fact and you'll be alright. Common sense is a beautiful thing.
This post was edited on 11/19/15 at 8:06 am
2
Posted on 11/19/15 at 8:11 am to bwallcubfan
quote:
What do you mean by this exactly?
Simply put, his advice is geared towards a financially uneducated or irresponsible individual. He sets boundaries that make it considerably harder to create wealth. He assumes that all of his listeners can't understand/handle how to effectively use debt to their advantage.
To be honest, for his listener base, he quite possibly is PREACHING the best message for them.
Posted on 11/19/15 at 8:52 am to LSUAfro
Well said. Its great advice for most of the public. But if you can do math, there are a lot of things that don't make sense.
For example:
Getting out of debt:
His snowball method works - paying off the smallest debt and working your way up to the largest debt. But oftentimes you can save a couple thousand bucks by either consolidating or working on the highest interest debt first.
Auto loans:
I agree with his philosophy that your total vehicles and toys should never add up to more than 50% of your income. However, it doesn't make a lot of sense (especially if you are averaging 12% like he says) to not pay 1.9% interest or less on a car loan. Simple math says that if you are getting a higher return than your interest rate, it makes sense to make credit work for you. Again, he's speaking to the crowd that will go and get a $400 car payment when they make $1200 a month.
Mortgages:
Same deal with the mortgage. 15 years is nice, and should be a goal. But his advice is an absolute. In a world with 30-year rates in the 3's and the appreciation of homes at a 1-2% clip, a disciplined person can really make it work for them. Again, the person that just wants the cheaper payment so they can go out and eat more- his advice is solid.
Emergency Funds:
He's right here. The 3-6 months of living expenses in the bank at all times is solid advice. His $1000 rule is for those swamped in credit card debt where $1000 makes a big difference.
Investing:
He's so full of shite here he could open a wastewater plant. Shoot for a 12% long term average? You just got the financially stupid out of debt and you are setting them up for failure.
He also advises to stop 401k distributions while getting out of debt. Even if you get a company match. Again, this is where that math kills his philosophy. Turn down 100% guaranteed return to pay off 20% interest debt. It is literally costing you $100 (plus potential growth down the road) to pay off $20 in this case.
For example:
Getting out of debt:
His snowball method works - paying off the smallest debt and working your way up to the largest debt. But oftentimes you can save a couple thousand bucks by either consolidating or working on the highest interest debt first.
Auto loans:
I agree with his philosophy that your total vehicles and toys should never add up to more than 50% of your income. However, it doesn't make a lot of sense (especially if you are averaging 12% like he says) to not pay 1.9% interest or less on a car loan. Simple math says that if you are getting a higher return than your interest rate, it makes sense to make credit work for you. Again, he's speaking to the crowd that will go and get a $400 car payment when they make $1200 a month.
Mortgages:
Same deal with the mortgage. 15 years is nice, and should be a goal. But his advice is an absolute. In a world with 30-year rates in the 3's and the appreciation of homes at a 1-2% clip, a disciplined person can really make it work for them. Again, the person that just wants the cheaper payment so they can go out and eat more- his advice is solid.
Emergency Funds:
He's right here. The 3-6 months of living expenses in the bank at all times is solid advice. His $1000 rule is for those swamped in credit card debt where $1000 makes a big difference.
Investing:
He's so full of shite here he could open a wastewater plant. Shoot for a 12% long term average? You just got the financially stupid out of debt and you are setting them up for failure.
He also advises to stop 401k distributions while getting out of debt. Even if you get a company match. Again, this is where that math kills his philosophy. Turn down 100% guaranteed return to pay off 20% interest debt. It is literally costing you $100 (plus potential growth down the road) to pay off $20 in this case.
Posted on 11/19/15 at 8:56 am to LSUAfro
quote:
Simply put, his advice is geared towards a financially uneducated or irresponsible individual. He sets boundaries that make it considerably harder to create wealth. He assumes that all of his listeners can't understand/handle how to effectively use debt to their advantage.
To be honest, for his listener base, he quite possibly is PREACHING the best message for them.
Ok gotcha...and I agree...I just didn't know what he meant by that.
Posted on 11/19/15 at 9:02 am to anc
quote:
if you can do math
They can't.
Posted on 11/19/15 at 9:05 am to TigerSaints318
quote:
I have since found Clark Howard and never listen to Dave anymore. Howard is a super nice guy and much more realistic about his guidance. Seems like the opposite of DR. I'd advise anyone listening to Dave to check Clark out.
It's funny you bring Clark up. Just recently on Dave's show, someone called in and claimed (and I'm paraphrasing) "we heard you (Dave) say it's ok to have credit cards as long as you pay them off..." and he was quick to stop her and say "I've never said such a thing." The caller said "oh must have been someone else that said it then." Dave responded, "yeah, probably Clark (as if he was rolling his eyes as he said it)." Just another example of Dave's character.
Posted on 11/19/15 at 9:28 am to bwallcubfan
quote:
The story in the OP just confirms my opinion of Dave as a person
I don't think the intention of the OP was to sway anyone's opinion of Dave. His post was a recollection of an interview he had well over 10 years ago. A LOT has changed at Dave's company since then. Maybe for the better or the worse. Who knows? Read some recent stuff for yourself on places like Glassdoor.com.
Look, what Dave teaches works. You don't need a rocket scientist to tell you that 4% > 2%. His program works because he focuses on correcting a behavior problem. He's said it a billion times.
quote:
I understand why he says credit cards are dangerous
quote:
that doesn't apply to me
quote:
started his debt snowball in April of this year
This is a behavior problem. Not a math problem.
Posted on 11/19/15 at 10:04 am to gamemc
quote:
I don't think the intention of the OP was to sway anyone's opinion of Dave.
I didn't say it was. Just giving my opinion on what I think about him personally.
quote:
A LOT has changed at Dave's company since then.
Hope so
quote:
This is a behavior problem. Not a math problem.
I get that. All I'm saying is the behavior thing isn't applicable to me. I understand why he says $1000 emergency fund, stop retirement, and don't use credit cards. I just don't agree with it in my circumstance. Some people need that push.
Posted on 11/19/15 at 10:54 am to bwallcubfan
I think it applies to everyone. I doubt many people went into debt with the intention of racking up so much that you need an intervention to get back on track.
If you stick to his plan, you're putting yourself in a better position to not make those mistakes. You're not going to be rich in 10 years following his plan but you can make changes that affect the generations that follow you.
If you stick to his plan, you're putting yourself in a better position to not make those mistakes. You're not going to be rich in 10 years following his plan but you can make changes that affect the generations that follow you.
Posted on 11/19/15 at 11:13 am to gamemc
My AC went out this summer...$5000...thank God I didn't go with his $1000 strategy.
I've never run up crazy debt on credit cards. I always pay it off. Sometimes I don't use it at all. So the cutting up of credit cards is a motivational strategy for people who have spending problems and are simply financially stupid. I understand his reasoning but that doesn't apply to me.
I've learned to better manage my money through this, because I was never really taught how to. So that part is great. Luckily for me, I've always been somewhat frugal and am consistent with saving money. All my debt is in cars. That's it. So I don't think intervention is the right word in my case.
And I'm not saying he's the devil. But I'm not going to sit here and say I agree with everything for my specific circumstance.
And to be clear, I understand his reasoning behind all his teachings. But it simply doesn't apply to me.
I've never run up crazy debt on credit cards. I always pay it off. Sometimes I don't use it at all. So the cutting up of credit cards is a motivational strategy for people who have spending problems and are simply financially stupid. I understand his reasoning but that doesn't apply to me.
I've learned to better manage my money through this, because I was never really taught how to. So that part is great. Luckily for me, I've always been somewhat frugal and am consistent with saving money. All my debt is in cars. That's it. So I don't think intervention is the right word in my case.
And I'm not saying he's the devil. But I'm not going to sit here and say I agree with everything for my specific circumstance.
And to be clear, I understand his reasoning behind all his teachings. But it simply doesn't apply to me.
This post was edited on 11/19/15 at 11:15 am
Posted on 11/19/15 at 11:18 am to gamemc
quote:
If you stick to his plan, you're putting yourself in a better position to not make those mistakes. You're not going to be rich in 10 years following his plan but you can make changes that affect the generations that follow you.
I always liked Dave's guarantee to people that were not sure if his plan was right for them. He said if you follow my plan, become debt free then discover you don't like it, I promise you can be in debt again within 24 hours.
Posted on 11/19/15 at 11:22 am to gamemc
quote:
I think it applies to everyone.
Well yeah, it applies to everyone, except those that it doesn't apply to.
If I fall in to debt because I lose my job, or can't work for an extended period for whatever reason, I'm still not applying his teachings to my life. He is fundamentally wrong on just about everything from a numbers standpoint. That's not really debatable, but that's not what he's selling. He's selling a simplified structure for the financially ignorant and/or irresponsible.
Posted on 11/19/15 at 11:57 am to LSUAfro
quote:
If I fall in to debt because I lose my job, or can't work for an extended period for whatever reason, I'm still not applying his teachings to my life. He is fundamentally wrong on just about everything from a numbers standpoint. That's not really debatable, but that's not what he's selling. He's selling a simplified structure for the financially ignorant and/or irresponsible.
Why would you fall into debt if you lost your job, or couldn't work, if you don't have a adequate emergency fund and disability insurance maybe Dave's plan is for you.
Posted on 11/19/15 at 11:57 am to LSUAfro
"It can apply to anyone" is a better phrase. It's not the only plan that works. I'm saying the plan works and can work for anyone. None of us are invulnerable to making mistakes. You don't have to be financially ignorant or irresponsible to do so.
I said in a previous post that it's not a math problem. It's about changing your behavior and putting yourself in a position to not slip up and make mistakes.
Oh and a $5000 AC unit is far from an emergency.
I said in a previous post that it's not a math problem. It's about changing your behavior and putting yourself in a position to not slip up and make mistakes.
Oh and a $5000 AC unit is far from an emergency.
Posted on 11/19/15 at 12:26 pm to EA6B
quote:
Why would you fall into debt if you lost your job
I wouldn't, but it was a hypothetical
quote:
if you don't have a adequate emergency fund and disability insurance
It's hard to believe, but even those that are prepared get dealt a shitty hand. See O&G industry workers if we don't see an uptick in 2016.
quote:
Dave's plan is for you.
Give yourself a pat on the back, now call in and tell Dave you're spreading the good word.
It's not the best plan. It's a decent plan for a large % of our society. That was the point of my post in response to the question, but glad you chimed in.
Posted on 11/19/15 at 12:28 pm to gamemc
quote:
You don't have to be financially ignorant or irresponsible to do so.
I agree and didn't say that. I said I think that the plan works best for those people.
Posted on 11/19/15 at 12:30 pm to gamemc
quote:
Oh and a $5000 AC unit is far from an emergency.
If all you have is a $1,000 emergency fund it can be.
Dave's reasoning is that if an emergency happens you can just run up the debt again because you were already in debt. But I'm not okay with that if my only debt is a 2.75% car loan.
Posted on 11/19/15 at 1:02 pm to gamemc
quote:
Oh and a $5000 AC unit is far from an emergency.
Please explain
Posted on 11/19/15 at 1:07 pm to LSUAfro
quote:
He's selling a simplified structure for the financially ignorant and/or irresponsible.
Exactly.
Which is 95% of Americans.
Dave is correct for 95% of people.
If you are in the 5% who can be disciplined and can do math, congrats. I am in that 5% and have never needed Ramsey, but I have half a dozen family members that benefitted tremendously from him.
Posted on 11/19/15 at 1:50 pm to bwallcubfan
If I have to explain why a $5,000 AC unit isn't an emergency, I don't know what to say. 
So you've exhausted all options and this is the only way you'll be able to survive the heat for 6 months while you save up the money to replace it?
So you've exhausted all options and this is the only way you'll be able to survive the heat for 6 months while you save up the money to replace it?
Page 3 of 6
Back to top
Follow TigerDroppings for LSU Football News