Author Topic: Distancing myself from Ramseyism.  (Read 38341 times)

craiglepaige

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Distancing myself from Ramseyism.
« on: March 28, 2017, 06:36:29 PM »
I've been  listening to Dave Ramsey since about the same time I got into MMM, so let's say late 2013. In all that time I was able to understand most of his reasoning and I always considered his followers to be in the "worst case" scenarios, so having simple to follow "Baby Steps" was okay. He doesn't have the MMM badassity nor does his followers have the extremeness that MMM followers do, but I was willing to let that slide since he was still helping people out.

Well, for some reason I listened to his live show yesterday as opposed to flipping through the YouTube videos as I normally do and I was turned off completely to the point I may not listen to him again.

In the 3hr show, there were probably only 45min of actual speaking/helping, and two plus hours of commercials.  Wether it was his daughter selling books, Churchill Mortgage ads, more books, ads for his local investors, and on and on, I felt like it was a never-ending commercial.  WTF?

Then the cherry on top was the advice he offered a lady whose parents were having financial troubles but whose house had a nice positive equity.  The parents had not worked in two years and had run up about $30k in debt.

After learning the house had about $220k in positive equity he advice the daughter to have her parents sell the house. Buy a house in the $150k range in cash. Pay off their debt and GO BACK TO WORK at 60yo for the mother and 75yo for the father.

What in the mother fucking world???

How could you calmly - actually he was speaking down about the parents for not having worked - and "advice" a 75yo person to go back to work without asking any other questions? Ramsey had no idea what type of work they did before, their health condition, their finances (other than the simple example), their retirement finances etc. 

I was listening to him in total disgust because I know they could had gotten better advice from the members here if they had done a member's case.

I think I'm done with him...
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asauer

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Re: Distancing myself from Ramseyism.
« Reply #1 on: March 28, 2017, 07:00:17 PM »
Yeah- I gained alot in the beginning from DR regarding behavior change.  But....I had the same experience of WTF when Rachel Cruz came on line.  It's high volume, low content.  I can't listen to her talk- she gives pat answers rather than well thought out responses. ugh.

khangaroo

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Re: Distancing myself from Ramseyism.
« Reply #2 on: March 28, 2017, 07:22:19 PM »
First off, I love Dave Ramsey and his principles truly changed my life.

However, I believe his approach is very cookie-cutter and is meant for the masses that really need help with just putting together a budget. He's a great starting point for building a financial foundation and getting things started but if you want more "advance" financial advice then I would turn elsewhere.

I use to listen to his podcasts religiously from 2014 to late 2016 but have moved on to other things as he says the same things over and over again - although he outright says he does this. I've moved onto Bigger Pockets because I want to get into RE.

DR has principles that he sticks to and his answers reflect that. After listening to him for so long, you can pretty much guess what he is going to say but, once again, he does say he's been saying the same thing for 30+ years.
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Better Late

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Re: Distancing myself from Ramseyism.
« Reply #3 on: March 28, 2017, 07:31:32 PM »
I still listen to DR from time to time, and agree the tone of the show has changed. I'm guessing he hired some MBA who realized they could build Dave's brand into an empire, and they are aggressively pursuing that.

craiglepaige

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Re: Distancing myself from Ramseyism.
« Reply #4 on: March 28, 2017, 07:55:20 PM »
I still listen to DR from time to time, and agree the tone of the show has changed. I'm guessing he hired some MBA who realized they could build Dave's brand into an empire, and they are aggressively pursuing that.

This​.

Every change of content started, was or ended with an ad. Every answer led to a sales pitch - either for books, classes, podcast, apps or other financial gurus (daughter, the deep voice black guy etc). I hated it. It wasn't worth my time.

Yes, for someone with a lack of financial discipline, like myself back in 2014, it's okay but for anyone who's committed to financial planning and investing, his advice is rather weak.
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englishteacheralex

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Re: Distancing myself from Ramseyism.
« Reply #5 on: March 28, 2017, 08:12:07 PM »
I won't listen to him anymore...and this is after around five years of taking his class, teaching his class, and listening to his podcast every single day. Yes, the constant ads and pitches and promotions. Those get incredibly tiresome. Also, the same advice over and over (although this was part of the appeal for a while, because it was oddly fun to answer every caller along with Dave--kind of like carpool karaoke; I know all the words to this song!).

But what did me in was Meg Meeker coming on the show to promote some new book about parenting and then saying Ivanka Trump and her dad obviously have a great relationship and that Trump must have been a great father. I just got fed up. I'm evangelical and I'm so mad at evangelicals right now with their polling numbers for Trump. Ramsey just feels like part of a massive block of things that really, really frustrate me right now.

His "rants" used to be entertaining...now I can't stomach them. He just seems so insensitive and tone deaf and oblivious to the nuances and grey areas of personal finance. So scathing towards any suggestion that people's problems might have systemic origins rather than them being entirely responsible for their financial situation. I mean, yes, personal responsibility is a huge part of money management, but when he gets so belligerent about "government's inability to do anything" I always became slightly furious. The social safety net is a huge part of so many of our success! Ramsey, have you ever heard of the word privilege? No? I bet you're one of those people who refuses to think such a thing exists.

Okay, I'm starting to splutter and foam at the mouth. I think what happened is I started doing a lot more reading and educating myself about government and politics, and I just couldn't handle the Ramsey oversimplification anymore.

Plus I love travel reward credit cards (um, I pay the balance every month? It gives me just as much pain to spend on a credit card as it does to spend cash? In fact, I hate cash because it doesn't show the transaction immediately categorized on my mint account?), my husband has a student loan that we're (gasp) keeping so that it can be cancelled by the student loan forgiveness program (it makes sense in our situation! We did the math! Quit calling the student loan a pet!! Arg.)

Hit a nerve, much? I consider myself well-qualified to bitch about Dave Ramsey. :)
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Bateaux

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Re: Distancing myself from Ramseyism.
« Reply #6 on: March 28, 2017, 08:56:53 PM »
Dave Ramsey runs a business.  I think there is help there for those that have no clue to financial responsibility.   But buying his programs and paying for his seminars are something I'd never recommend.   
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craiglepaige

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Re: Distancing myself from Ramseyism.
« Reply #7 on: March 28, 2017, 09:10:22 PM »
Wow "englishteacheralex" I seem to have hit a nerve lol. Pretty much what you said also. I'm not religious (Don't call myself atheist, I just have my own beliefs) and his religious rants didn't bother me. But then he got more political and more religious... Not my style.

In his first "segment", three calls, not once did I agree with the advice he offered.  That's when I knew.
« Last Edit: March 29, 2017, 04:45:21 AM by craiglepaige »
-The conqueror will always become a slave to his conquest.

- Eres Un Esclavo Financiero
https://youtu.be/GO1Fsp4cUTQ

Dicey

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Re: Distancing myself from Ramseyism.
« Reply #8 on: March 29, 2017, 01:26:24 AM »
Never been a fan, at all. Nothing to distance from personally, just sitting on the curb and clapping as y'all go by.
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asauer

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Re: Distancing myself from Ramseyism.
« Reply #9 on: March 29, 2017, 07:27:32 AM »

Plus I love travel reward credit cards (um, I pay the balance every month? It gives me just as much pain to spend on a credit card as it does to spend cash? In fact, I hate cash because it doesn't show the transaction immediately categorized on my mint account?),

Haha!  My husband and I are the exact same.  I LOVE my rewards card- both vacations this year are going to be nearly free because of them!  And since I'm a Mint stalker, I need those transactions to show!

patchyfacialhair

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Re: Distancing myself from Ramseyism.
« Reply #10 on: March 29, 2017, 08:14:53 AM »
I used to listen to him on my commute home every day. I even purchased(!) two of his books, and enjoyed them.

I stopped listening after the hundredth time hearing the "baby steps" and "12% rate of return."  Not to mention the same ads over and over.

That being said, I still recommend him to my peers that struggle making financial progress. The simplicity of the steps is fantastic.

Smokystache

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Re: Distancing myself from Ramseyism.
« Reply #11 on: March 29, 2017, 08:56:36 AM »
I've since moved on to many more interesting podcasts (MadFientist, etc.), but if you're going to listen to DR (as I still do once in a while on a long drive) be sure to listen to the podcast - there are only about 2-3 commercials per hour of content as opposed to 5 commercials every 15 minutes.

prognastat

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Re: Distancing myself from Ramseyism.
« Reply #12 on: March 29, 2017, 09:13:20 AM »
I listen to some of the excerpts, but can't listen to the full show streams as it is just too much to take.

I would say he is good at one thing and that is motivating people to get out of debt, which is the important first step. The main problem is what comes after and this is where I feel it falls short. His advice on anything after getting out of debt starts becoming questionable. His investing advice is vague and likely to do more harm than good for most of his listeners if they keep following his advice after getting out of debt.

Despite this I have actually bought his program as a gift for my SIL and her partner. This is after years of us trying to help her ourselves and it generally falling on death ears over and over. She is about 8 years older than us and has a massively negative net worth despite being pretty smart outside of finances. We are hoping that with the classes, the group involvement and the religious part it might work however only time will tell if it was worth it.

Dances With Fire

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Re: Distancing myself from Ramseyism.
« Reply #13 on: March 29, 2017, 09:32:24 AM »
I also used to listen to him on my daily commute. Not so much anymore. Why?

His constant rant on the 12% returns and YOU must be a moron if you don't earn those returns. "Anyone can earn that." With the help of his ELP's. Really? Show me your ELP's statements for the past 10-15 years.

Also his advice of No Bonds in his personal portfolio with total disregard of the persons age, ability, and need to take risk on a 100% stock portfolio. (For the record Dave holds A BUNCH of real estate with positive cash flow. The average Joe lunch-box doesn't have that kind of portfolio and therefore relies on bonds to achieve a certain level of diversification and financial peace of mind.

His constant salesmanship is getting old.

FireHiker

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Re: Distancing myself from Ramseyism.
« Reply #14 on: March 29, 2017, 09:41:40 AM »
I think Ramsey is a decent enough starting point for the entirely clueless, mainstream consumer-sucker. Better than continuing on with mainstream society racking up tons of credit card debt with no clue where the money goes. I have a friend who is really into Dave Ramsey (funny because she is not religious at ALL), and I'm trying to nudge her this direction. I absolutely don't agree with him on credit cards! We treat ours just like cash and never carry a balance, but we get a LOT of rewards by using them strategically, and it seems foolish to be leaving that money (and the tracking, which I like) on the table.

I haven't looked in awhile though; I would be very turned off by the direction he's gone from what's been described here.

LiveLean

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Re: Distancing myself from Ramseyism.
« Reply #15 on: March 29, 2017, 10:13:06 AM »
DR is a great starting point for a lot of folks. I should find Rachel Cruz more annoying -- I don't want a 28-year-old's advice on anything, let alone long-term financial planning -- but she's found a niche with speaking to younger adults and kids.
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Jrr85

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Re: Distancing myself from Ramseyism.
« Reply #16 on: March 29, 2017, 10:17:26 AM »
I listen to some of the excerpts, but can't listen to the full show streams as it is just too much to take.

I would say he is good at one thing and that is motivating people to get out of debt, which is the important first step. The main problem is what comes after and this is where I feel it falls short. His advice on anything after getting out of debt starts becoming questionable. His investing advice is vague and likely to do more harm than good for most of his listeners if they keep following his advice after getting out of debt.

Despite this I have actually bought his program as a gift for my SIL and her partner. This is after years of us trying to help her ourselves and it generally falling on death ears over and over. She is about 8 years older than us and has a massively negative net worth despite being pretty smart outside of finances. We are hoping that with the classes, the group involvement and the religious part it might work however only time will tell if it was worth it.

He's good at motivating and he's good at forming a plan that takes into account that emotions are more important than math for the vast majority of people.  Some of his worst advice I think flows out of his accounting for people's emotions.  But on net, if you follow his advice people will end up not as rich as they should be, but still more or less rich and much better off than most people. 

The only thing that seems truly destructive to me is when he is talking about draw down rates.  And maybe his advice on life insurance, which will often leave people underinsured (but on the other hand probably simplifies it enough for people to go get insurance and prevents them from getting suckered into being way underinsured with bad whole life products).  Most other stuff is not destructive but just suboptimal, but still good enough. 

TheAnonOne

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Re: Distancing myself from Ramseyism.
« Reply #17 on: March 29, 2017, 10:29:47 AM »
I listen occasionally on my 5 minute drive home.

I think his advice is mostly shyt in mostly all subjects. Yea, ok, get out of debt, sure, but he relentlessly pushes people to pay off their homes with no regard to the actual math. His ELPs are expensive, and 12% is laughable.

The best part is a mood booster when someone who's 68 calls in with 32k saved and no possible way to turn it around. Ok, maybe 'motivational factor' is a better term.
« Last Edit: March 29, 2017, 10:31:29 AM by TheAnonOne »

ysette9

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Re: Distancing myself from Ramseyism.
« Reply #18 on: March 29, 2017, 10:46:52 AM »
I've never listened to him but did stumble upon his articles a long while back on my aimless search for personal finance content online. (How funny to look back and realize that I was searching for MMM without knowing that any such thing existed!) I read a couple of articles which were fine, but then I read one where he talked about why it is best for the woman to stay at home and look after the household. As I said recently on the Bogleheads forum and got flagged by a mod, f-that"!
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Matt

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Re: Distancing myself from Ramseyism.
« Reply #19 on: March 29, 2017, 10:54:02 AM »
My wife and I commute together and listen occasionally and commented the other day how cool it would be to call in with our FIRE scream vs debt free scream to celebrate actual freedom.  Then when asked how we got there be like well we took out a 30 year mortgage at a low interest rate and kept it, used credit card reward points to travel and stay in hotels, and put money into accounts that avoid taxes vs his advice to always put money into a Roth.


ysette9

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Re: Distancing myself from Ramseyism.
« Reply #20 on: March 29, 2017, 11:22:15 AM »
If you do, let me know and I'll pull up that podcast for a listen :)
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patchyfacialhair

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Re: Distancing myself from Ramseyism.
« Reply #21 on: March 29, 2017, 11:41:53 AM »
That would be awesome. Just lie to the phone screener (basically say that you followed all the steps and you only now use cash/debit), and then drop the bomb on ol Davey.

RangerOne

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Re: Distancing myself from Ramseyism.
« Reply #22 on: March 29, 2017, 12:27:51 PM »
The thing to keep in mind with Dave Ramsey is he is almost a ubiquitous household name when it comes to personal finance and he profits fantastically from his books, seminars, podcasts and all that stuff.

As such he has adjusted his views and content to suite his audience and his investors. The basic content that made him famous is probably mostly still sound advice, but he has become a kind of Dr. Phil and most of his stuff now is just a personal sales pitch mixed with his old advice.

Sounds like he has also zoned in on a more right leaning religious audience so naturally then he would pander to the prevailing mood of that audience. Not my personal preference but I have friends and family who sing that way.

I don't think there is anything wrong with what he is doing, but I am 100% on the same page of having no interest in listening to advice from people who are profiting fantastically off freely available advice.

 My prevailing feelings with regards to learning now that I am done with school, is that all information worth having these days is essentially free. Aside from possibly wanting to fund a person who doesn't rely on cooperate sponsors like donating to a podcast you like to keep it commercial free. With a bit of time and motivation there is nothing these people could teach you that you couldn't learn by reading a few books from the library or internet and following some free blogs and forums. In that light anyone trying to turn a buck to give you this information is kind of ripping you off. But of course I like anyone else have paid for "expert" advice here and there in my life, I've just gotten picker about who I think deserves my money.

boyerbt

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Re: Distancing myself from Ramseyism.
« Reply #23 on: March 29, 2017, 01:34:44 PM »
My wife and I commute together and listen occasionally and commented the other day how cool it would be to call in with our FIRE scream vs debt free scream to celebrate actual freedom.  Then when asked how we got there be like well we took out a 30 year mortgage at a low interest rate and kept it, used credit card reward points to travel and stay in hotels, and put money into accounts that avoid taxes vs his advice to always put money into a Roth.

I applied to do my debt free scream after paying off all of my student loans but knew that I would never get a response back due to my honesty. A few of the questions that they ask for the prescreening questionnaire is if you use credit cards. I answered it honestly by stating that I used CC throughout my debt repayment process and continue to do so and pay it off every month. I thought that I may have a shot as my entire debt amount was from student loans and nothing else but it has been about six months since I submitted my info and have received nothing back.
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prognastat

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Re: Distancing myself from Ramseyism.
« Reply #24 on: March 29, 2017, 01:55:37 PM »
My wife and I commute together and listen occasionally and commented the other day how cool it would be to call in with our FIRE scream vs debt free scream to celebrate actual freedom.  Then when asked how we got there be like well we took out a 30 year mortgage at a low interest rate and kept it, used credit card reward points to travel and stay in hotels, and put money into accounts that avoid taxes vs his advice to always put money into a Roth.

I applied to do my debt free scream after paying off all of my student loans but knew that I would never get a response back due to my honesty. A few of the questions that they ask for the prescreening questionnaire is if you use credit cards. I answered it honestly by stating that I used CC throughout my debt repayment process and continue to do so and pay it off every month. I thought that I may have a shot as my entire debt amount was from student loans and nothing else but it has been about six months since I submitted my info and have received nothing back.

One thing that becomes quite obvious after even just cursory viewing is that it is very much his way or the highway. If you use CC for rewards/cash back and pay it back without interest it is silly to do so for what little it would benefit you, without even getting to the point of discussing just how much money could be made this way even to amounts where it would easily cover some of the debt people on his show discuss. If you question paying of your house and instead would rather invest this this is crazy, though if he really believes you can get a guaranteed 12% average annual return with his ELPs then you really shouldn't pay off your 3-4% APR mortgage. Same for the advice to prioritize paying off low interest loans/debt even at the cost of missing out on things such as employer match.

There are good cases to be made that quite a few of his strategies are quite sub optimal, but there isn't any room for concessions that these more optimal strategies might work for some people.


Ben Hogan

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Re: Distancing myself from Ramseyism.
« Reply #25 on: March 29, 2017, 01:57:18 PM »
Got nothing but love and appreciation for Dave Ramsey for anyone in debt. Investment is a different subject. No need to hate on Dave, simply consider your self graduated from his university.


prognastat

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Re: Distancing myself from Ramseyism.
« Reply #26 on: March 29, 2017, 02:03:18 PM »
Got nothing but love and appreciation for Dave Ramsey for anyone in debt. Investment is a different subject. No need to hate on Dave, simply consider your self graduated from his university.

I think it would be a lot less contentious if Dave himself acknowledged this instead of still offering advice on things that are clearly not his strong points.

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Re: Distancing myself from Ramseyism.
« Reply #27 on: March 29, 2017, 02:06:40 PM »
Got nothing but love and appreciation for Dave Ramsey for anyone in debt.

Even then, no distinction between high-interest and low-interest debt, and the resulting treatment from a "must pay now" perspective.  My wife has some negligible student loan debt (couple grand at this point?) that she consolidated way back when at literally about 0.5% interest.  That is not a must-pay emergency (I will let it auto-deduct until the day it stops auto-deducting).  But Dave treats it the same way he would a 29.9% APR credit card.  STUPID.
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FireHiker

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Re: Distancing myself from Ramseyism.
« Reply #28 on: March 29, 2017, 02:08:17 PM »
Got nothing but love and appreciation for Dave Ramsey for anyone in debt. Investment is a different subject. No need to hate on Dave, simply consider your self graduated from his university.

Yeah, with my friend who is still working on tons of debt who follows Ramsey, I referred to him as community college/undergrad and MMM as grad school, when it comes to financial literacy.

v8rx7guy

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Re: Distancing myself from Ramseyism.
« Reply #29 on: March 29, 2017, 02:10:29 PM »
That would be awesome. Just lie to the phone screener (basically say that you followed all the steps and you only now use cash/debit), and then drop the bomb on ol Davey.

Oh yeah, you'll get him real good!  Trying to tell average people who can't handle credit cards and rack up 10's of thousands in debt (over $15K average in the USA) that they shouldn't use credit cards and rather to save up is SUCH bad advice.
« Last Edit: March 29, 2017, 02:14:11 PM by v8rx7guy »

Dicey

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Re: Distancing myself from Ramseyism.
« Reply #30 on: March 29, 2017, 02:15:19 PM »
Got nothing but love and appreciation for Dave Ramsey for anyone in debt. Investment is a different subject. No need to hate on Dave, simply consider your self graduated from his university.
I see what you did there.
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solon

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Re: Distancing myself from Ramseyism.
« Reply #31 on: March 29, 2017, 02:37:32 PM »
Got nothing but love and appreciation for Dave Ramsey for anyone in debt. Investment is a different subject. No need to hate on Dave, simply consider your self graduated from his university.
I see what you did there.

I don't. What did he do there?

Lumberjack

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Re: Distancing myself from Ramseyism.
« Reply #32 on: March 29, 2017, 02:53:19 PM »
Made a slick reference to Financial Peace University (https://www.daveramsey.com/fpu/)

Dave Ramsey is great if you're in a bad way and need a constant, predictable voice saying the same thing to keep you on track. As soon as you're in a position to start making decisions, the baby steps aren't for you.

AZryan

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Re: Distancing myself from Ramseyism.
« Reply #33 on: March 29, 2017, 03:15:50 PM »
I'm not religious (Don't call myself atheist, I just have my own beliefs)-

For the record -'atheist' just means 'not religious'. That's all. You're free to not call yourself one, but you are one by your own words.

Don't mean to derail the topic, but since Ramsey uses religion as part of his hook, I thought I'd mention this misconception people often have.

An atheist could be a nice, generous liberal, or angry, greedy libertarian. They might hate all religions, or not care about the subject at all. They could be highly logical/rational, or they could be a nutty conspiracy theorist. All they have to do is not have any religion/dogma or God they believe in. They could say they just don't know if a God or Gods exist (agnostic = no knowledge), or say the overwhelming evidence shows that any God is as fictional as Santa Claus or Batman.

Every time I've met someone who is super impressed by Ramsey, they're also very religious, very dumb with money, and very low-information, emotional deciders -meaning they seem to believe many important things in their lives based on whatever they feel they want to be true. People like Ramsey know this and abuse it as 'voices of authority' -same as most churches and cults that make sure to start right at birth.

patchyfacialhair

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Re: Distancing myself from Ramseyism.
« Reply #34 on: March 29, 2017, 03:28:47 PM »
That would be awesome. Just lie to the phone screener (basically say that you followed all the steps and you only now use cash/debit), and then drop the bomb on ol Davey.

Oh yeah, you'll get him real good!  Trying to tell average people who can't handle credit cards and rack up 10's of thousands in debt (over $15K average in the USA) that they shouldn't use credit cards and rather to save up is SUCH bad advice.

lighten up francis

neverrun

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Re: Distancing myself from Ramseyism.
« Reply #35 on: March 29, 2017, 04:09:44 PM »
I agree with the complaints of the above.  I use to listen to Dave and be entertained now I just here an ad.  I also got really made when he reposted 2 blogs from his religious program guy the other day on Facebook.  One was things I say to my son and one things to say to my daughter.  To the son, be brave you can do it; in contrast to my daughter you are pretty.  Yup I don't even glance at his stuff after that.


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Erinbynight

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Re: Distancing myself from Ramseyism.
« Reply #36 on: March 29, 2017, 04:09:59 PM »
I used to listen to him, and do believe he got me fired up about paying off debt. But that is all. Besides paying off debt, he gives TERRIBLE financial advice. I listened to a few podcasts recently just to see what he was up to these days. He utilized bankruptcy to turn his life around. Callers who desperately need to file bankruptcy he advises to sell their homes and rent, and liquidate retirement accounts to pay off debt. No mention of how those accounts are protected. I believe he gives very scripted advice these days compared to five years ago. He wants you to use a financial advisor for a front loaded fee or hire an attorney he recommends to tell you consider bankruptcy. I believe he is now part of the problem of listeners staying in debt, due to his bad advice, and my way or the high way attitude. He is no longer a capitalist but a parasite.

sovereign

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Re: Distancing myself from Ramseyism.
« Reply #37 on: March 29, 2017, 04:17:13 PM »
MMM is a breath of fresh air after sampling the egoic rants of many "personal finance experts". ;)

oldmannickels

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Re: Distancing myself from Ramseyism.
« Reply #38 on: March 29, 2017, 04:24:11 PM »
Sounds like all you are playin' kissy faces with the banks :-*.

I like the show mostly because of the debt free screams and while I don't follow all of his advice it reminds me to keep things simple. Too many times I fall prey to the shiny object syndrome and don't accomplish anything. Paying off my mortgage sounds nice, but so do many other expensive decisions.

It also helped me get my wife on a budget, which I don't think she would have done without the debt free screams.

Lumberjack

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Re: Distancing myself from Ramseyism.
« Reply #39 on: March 29, 2017, 05:06:31 PM »
Debt free screams are pretty sweet.

redbird

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Re: Distancing myself from Ramseyism.
« Reply #40 on: March 29, 2017, 05:39:18 PM »
I've never used his advice. Most of it seems aimed towards helping people get out of debt. I've never really had debt. But I'm also not religious, so that was another reason to never bother.
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RangerOne

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Re: Distancing myself from Ramseyism.
« Reply #41 on: March 29, 2017, 06:34:22 PM »
Got nothing but love and appreciation for Dave Ramsey for anyone in debt.

Even then, no distinction between high-interest and low-interest debt, and the resulting treatment from a "must pay now" perspective.  My wife has some negligible student loan debt (couple grand at this point?) that she consolidated way back when at literally about 0.5% interest.  That is not a must-pay emergency (I will let it auto-deduct until the day it stops auto-deducting).  But Dave treats it the same way he would a 29.9% APR credit card.  STUPID.

Low interest debt could be an emergency for some people. Or simply just planting the idea that debt is bad can make people avoid making a terrible purchase decision.

For instance cars loans are very low interest now. If you buy a sane priced car with the ability to pay it off instantly then you can chose to leverage low interest to do something better with your cash.

But for an average person the low interest loan is license to borrow more car than they can afford, not a source of leverage.

By planting the idea that all debt is really bad, you can encourage that person to take out a much smaller loan and buy a more affordable car.

I think that approach to debt has it place with those who will never take the time to learn to invest wisely.

englishteacheralex

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Re: Distancing myself from Ramseyism.
« Reply #42 on: March 29, 2017, 06:51:02 PM »
Oh, right, the bankruptcy thing...

So Dave frequently explains how he was "stupid with zeroes on the end" in order to make it seem like he is super empathetic and made all the same mistakes that his callers made.

However, the situations are rarely analogous.

Dave Ramsey went bankrupt because his whole state of being is oriented towards entrepreneurship, working his ass off, and making as much money as possible. In his twenties, he didn't understand the concept of risk and went way too far into debt in order to finance real estate investments.

So that's a totally different situation than what most of the callers to his show have--they typically have a lot of consumer debt and an underwater mortgage on their primary residence. A lot of the time they have some horrible medical bills, too. The motivation for the debt is different; they weren't trying to build a real estate empire, they were financing a lifestyle they couldn't afford (and often running into some bad luck).

Dave's orientation pretty much ensured that he was going to be a millionaire in some shape or form as soon as he shed the craziness of youth and wised up. Which is great, I don't begrudge him that--it's a great American success story.

But it doesn't acknowledge the reality of many/most of his listeners. Not everyone is designed for entrepreneurship. Bankruptcy is sometimes the wisest decision under the circumstances. Financial advice isn't one-size-fits-all. Yes, debt is bad. Living beyond one's means is really bad. But that's just one piece of financial success...the most important piece, probably, but not the whole pie. And one of the most important pieces is something I never heard Ramsey talk about in the many years I listened to him so faithfully--that it isn't about living like no one else so later you can live like no one else, it's about living like no one else so you can avoid the anxiety and lack of peace that financial disorganization brings...right now. I don't care if I ever get a mansion or a fancy car or great vacations; I just want to have no trouble sleeping at night.

MMM made it easy for me to stop listening to Ramsey as I realized that MMM is much more my wheelhouse.

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en58

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Re: Distancing myself from Ramseyism.
« Reply #43 on: March 29, 2017, 07:19:47 PM »
Unlike most people here I respect and admire what Dave Ramsey does. The reasons are simple. His main topic is to understand that finance in 80% behavior. In this blog almost every one understands that, so people feel that his ideas are generalized and not mathematically correct. If you grasp that finance is more about you controlling what you do, you understand that Dave has a great point.   I view Dave more as someone who makes you understand that you need to change your habits before you gain wealth. He also does a good job in keeping you motivated.

Now, having said all that there are things I could care less about. His 12% being one, his anti indexing, and too much religious stuff (especially him cherry picking the bible). But, just remember that he is a business man and he has to make money too. If he were to say don't use the people I endorse just buy index fund's, it would be bad for business.

Wexler

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Re: Distancing myself from Ramseyism.
« Reply #44 on: March 29, 2017, 08:35:42 PM »
I think Ramsey is a decent enough starting point for the entirely clueless, mainstream consumer-sucker. Better than continuing on with mainstream society racking up tons of credit card debt with no clue where the money goes. I have a friend who is really into Dave Ramsey (funny because she is not religious at ALL), and I'm trying to nudge her this direction. I absolutely don't agree with him on credit cards! We treat ours just like cash and never carry a balance, but we get a LOT of rewards by using them strategically, and it seems foolish to be leaving that money (and the tracking, which I like) on the table.

I haven't looked in awhile though; I would be very turned off by the direction he's gone from what's been described here.

Totally agree!  The typical MMM forum member is doing an excel spreadsheet with the $250 difference in interest paid between the highest interest method vs. the debt snowball method and thinking "man-why do a debt snowball?  That makes no sense."  Meanwhile, the typical Dave Ramsey listener wouldn't be in the pickle they are in if they were capable of doing that kind of analysis in the first place.  Dave Ramsey gets his listeners and the way they think.  This is a feels, not reals, kind of crowd that responds to emotional motivation.

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Re: Distancing myself from Ramseyism.
« Reply #45 on: March 29, 2017, 08:52:33 PM »
I keep having this fantasy that we could somehow engineer a mustachian phone bomb to one of Dave's new "millionaire theme hours" and totally blow his standard lines about how people get to be millionaires.  All us credit card carryin', index fund totin' early retired and happy about it folk calling in on one episode would make him crazy!    I know the producers would edit us all out in the end, but it would be fun to try, especially if those episodes really are live....
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aceyou

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Re: Distancing myself from Ramseyism.
« Reply #46 on: March 29, 2017, 09:31:55 PM »
My biggest problem with him is how he totes the religion.  I wish I had saved it, but I read an article from him once where he basically talked about how god willed a sports car into his life.  The way he described it, it was like god chooses who gets fancy things, and when they do/don't get them. 

Maybe my disgust at this kind of assertion is simply because I'm not a religious person, but this does disgust me.  To see millions dying of malaria, malnutrition, war, etc, and then to assert that you have a fancy car because some supernatural power WANTS you to. No thank you. 

I have a nice house because I was born in the richest country in the world to two amazing parents.  Those parents gave me support as I got an education that most in this world would be lucky to have a chance at.  With this undeserved leg up, my hard work has taken me far more ahead than hard work takes most people. 

My unearned privilege, paired with a lot of hard work, is why I have 99% of the things I have, and I suspect that the same is true for Dave Ramsey...not because a god wants us to have sweet shit while others starve to death.  I don't know if a god exists, but I can't imagine it'd give a flying f@#$ what kind of sports car anyone drives.  If it did care, I'd hope it'd be pissed that we are driving that shit around when we could be spending our resources helping others instead. 

So yeah, not a Dave Ramsey fan. 

Bateaux

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Re: Distancing myself from Ramseyism.
« Reply #47 on: March 29, 2017, 10:47:22 PM »
I keep having this fantasy that we could somehow engineer a mustachian phone bomb to one of Dave's new "millionaire theme hours" and totally blow his standard lines about how people get to be millionaires.  All us credit card carryin', index fund totin' early retired and happy about it folk calling in on one episode would make him crazy!    I know the producers would edit us all out in the end, but it would be fun to try, especially if those episodes really are live....

I'm game! I have 2 commas.   Heck I'll credit a pack of peanuts to score rewards.   My Amazon purchases, 5% return.   Best not buying at all if you can avoid spending, but some things are necessary.   Like my new LED flashy USB rechargeable bicycle lights.
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Notasoccermom

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Re: Distancing myself from Ramseyism.
« Reply #48 on: March 30, 2017, 07:39:29 AM »
DR's baby steps got us out of debt. And honestly his program saved our finances and marriage when we were young and stupid. But I find that after you get out of debt his stuff is kinda weak. I needed something a bit more extreme. I want to retire a millionaire in my 40s and not when I'm 65. Also we *GASP!!* have a credit card, but we seriously live WAY below our means and pay it off every month, because we have the discipline to do so.

boyerbt

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Re: Distancing myself from Ramseyism.
« Reply #49 on: March 30, 2017, 08:28:00 AM »
Got nothing but love and appreciation for Dave Ramsey for anyone in debt.

Even then, no distinction between high-interest and low-interest debt, and the resulting treatment from a "must pay now" perspective.  My wife has some negligible student loan debt (couple grand at this point?) that she consolidated way back when at literally about 0.5% interest.  That is not a must-pay emergency (I will let it auto-deduct until the day it stops auto-deducting).  But Dave treats it the same way he would a 29.9% APR credit card.  STUPID.

Low interest debt could be an emergency for some people. Or simply just planting the idea that debt is bad can make people avoid making a terrible purchase decision.

For instance cars loans are very low interest now. If you buy a sane priced car with the ability to pay it off instantly then you can chose to leverage low interest to do something better with your cash.

But for an average person the low interest loan is license to borrow more car than they can afford, not a source of leverage.

By planting the idea that all debt is really bad, you can encourage that person to take out a much smaller loan and buy a more affordable car.

I think that approach to debt has it place with those who will never take the time to learn to invest wisely.

This is hitting the nail on the head. The general population does not consider the options of leveraging debt to gain wealth but rather as a way to get more options on that new car. The majority of MMM fans here understand all of this put for the average person hasn't learned this and may never understand it. To them, 0% interest means that they are getting a BMW 5 series instead of a 3 series and adding nothing else to their investments.
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