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re: Buy Dave Ramsey’s Tennessee home
Posted on 2/23/21 at 7:35 pm to LatinTiger30
Posted on 2/23/21 at 7:35 pm to LatinTiger30
quote:
I followed his plan and I’ll be 100% debt free by May. The plan itself works and no I didn’t skimp. I just cut back on a lot.
Out of curiosity, were you raised in a household that used credit quite a bit? Coming from a frugal household, his advice is commone knowledge, and it amazes me that people didn’t know this already. My dad wasn’t a “cut up your credit cards” type, but always explained why you pay them off every month to avoid interest. He also payed cash for cars. I’m curious, was Dave’s steps “new knowledge” for you, or was it just an easy to follow template, like weight watchers points for people who already know they need to eat less and move more to lose weight?
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Posted on 2/23/21 at 7:35 pm to LatinTiger30
quote:
I followed his plan and I’ll be 100% debt free by May. The plan itself works and no I didn’t skimp. I just cut back on a lot.
I did too years ago. Not completely, but definitely cut back on some wants, and poured money into paying off my mortgage, and then banked the payment. It helped me upgrade my home this past year.
His advice is rock solid and applicable for 95% of the American people. Yes, if you are smart enough and paying attention to your income and expenses you can do it without him, but far less people are doing that than care to admit it.
Posted on 2/23/21 at 7:39 pm to ItNeverRains
quote:
I understand this is not typical, but with cheap money taking a 15 year for 2% vs a 30 for 2.5% is a terrible choice. If I could get 2.5% for 1000 years I would take it.
Why?
If you take a $200k house and compare the 15 year versus the 30 year, you're paying over $50k more in interest on the 30 year. Even if you pay extra each month on the 30 year up to the same amount you would have paid on the 15 year, you're still paying over $10k more in interest.
Posted on 2/23/21 at 7:42 pm to Cowboyfan89
If you are committed to paying that amount no matter what wouldn't your market returns outweigh committing the money to paying down a 2.5% mortgage?
Posted on 2/23/21 at 7:43 pm to lsupride87
quote:
His financial stance is only good for completely uneducated people though.
While I agree, I think this encompasses the vast majority of people.
Posted on 2/23/21 at 7:44 pm to Cowboyfan89
quote:
If you take a $200k house and compare the 15 year versus the 30 year, you're paying over $50k more in interest on the 30 year. Even if you pay extra each month on the 30 year up to the same amount you would have paid on the 15 year, you're still paying over $10k more in interest.
The idea is that you invest the difference and make more than 3%. Sounds good in theory, but 80% of people will blow the difference on shite, and not actually invest it.
Posted on 2/23/21 at 7:44 pm to Cowboyfan89
Interest expense is tax deductible
Posted on 2/23/21 at 7:45 pm to Ric Flair
That’s a personal issue, not a mathematical one.
Posted on 2/23/21 at 7:47 pm to Paul Allen
quote:
Interest expense is tax deductible
With the increase in the standard deduction, I’m guessing 99% of employed people (not business owners) don’t itemize.
Posted on 2/23/21 at 7:48 pm to Ric Flair
quote:
The idea is that you invest the difference and make more than 3%. Sounds good in theory, but 80% of people will blow the difference on shite, and not actually invest it.
Ah, didn't think of it that way.
Makes sense. I'd still rather have the house paid off as soon as possible. When I retire, I want a paid off house. I don't want to still be paying on a house when I'm retired, and I plan to go as soon as I have the time and age requirements met. Frick working if I don't have to...
Posted on 2/23/21 at 7:54 pm to Cowboyfan89
quote:
Why?
If you take a $200k house and compare the 15 year versus the 30 year, you're paying over $50k more in interest on the 30 year. Even if you pay extra each month on the 30 year up to the same amount you would have paid on the 15 year, you're still paying over $10k more in interest.
Because math. I’m not wired like a caller on Ramsey’s show. I’ll take 2.5% over 30 and with an average 10%-12% Stock market average I’ll have my cake and eat it too.
Posted on 2/23/21 at 7:57 pm to Cowboyfan89
quote:
Makes sense. I'd still rather have the house paid off as soon as possible. When I retire, I want a paid off house. I don't want to still be paying on a house when I'm retired, and I plan to go as soon as I have the time and age requirements met. Frick working if I don't have to...
I did, no mortgage for 8 years. But I did just build my retirement home, and I do have a small mortgage, but I'm good with it overall. I'm going to pay it till 62, then let SS take over from there.
Posted on 2/23/21 at 7:58 pm to ItNeverRains
quote:
average 10%-12% Stock market average
I see you’re using Dave’s numbers for growth in the proverbial “growth stock mutual funds”. It honestly angers me when he uses 10-12% for a potential withdrawal rate from retired people.
Posted on 2/23/21 at 7:58 pm to Ric Flair
“You just have to find the right funds! There’re out there! Just find them!”
“Dave what are these funds?”
“Just look!”
“Dave what are these funds?”
“Just look!”
Posted on 2/23/21 at 7:59 pm to ItNeverRains
His advice is not terrible in a very basic way, but his on-air schtick is annoying and patronizing, and from what I've read about him, his management style is tyrannical boss/cult leader.
And he's raised the humblebrag to an art form.
And he's raised the humblebrag to an art form.
Posted on 2/23/21 at 8:02 pm to jimbeam
quote:
“You just have to find the right funds! There’re out there! Just find them!” “Dave what are these funds?” “Just look!”
No, you have to get an ELP....uh....”Smartvestor Pro” to sell you some American funds with a 6% load up front.
Posted on 2/23/21 at 8:11 pm to ItNeverRains
quote:
a caller on Ramsey’s show.
Caller: DAVE! I'm DEBT FREE!!!!!
DAVE: Congrats! How much did you pay off, and how did you do it?
Caller: Well, We paid off $375,000 in 2 and a half years by scrimping and saving. We sold stuff. Traded in two upside down new cars for one beater.
DAVE: How do you make money?
Caller: Well, I sell handmade wooden baskets and my wife baby sits sick rodents and reptiles at the local animal rescue.
DAVE: Well, that's great! So glad you worked the plan!
Caller: We sure did, Dave! Like I said, we paid small debts first. Then tackled the bigger ones. We were able to pay off student loans for our degrees in poetry and gun making, then moved on to our $100,000 mortgage.
DAVE: How did you do that by selling stuff and eating beans and rice?
Caller: Oh, I forgot to add that my wife's grandma left her a 4-story brownstone in NYC that we sold last month. We're now debt free and sitting on about 2 million cash. Your plan worked great! Can't thank you enough!
Posted on 2/23/21 at 8:15 pm to LuckySo-n-So
That’s awesome
This post was edited on 2/23/21 at 8:15 pm
Posted on 2/23/21 at 8:16 pm to jts1207
I drank the Dave Koolaid and paid off 250K in student loans in 5 years. Now I'm a baller.
Posted on 2/23/21 at 8:17 pm to jts1207
Atleast post a pic and the price instead of a blind link.
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