Is Dave Ramsey a damned moron?

[Telecaster]

No, not a straw man. I couldn't quite figure out which one it was. A red herring maybe?

Yes, a red herring.   No one became a millionaire taking advantage of credit card points.  True statement.   But that's not an argument against using credit card points. 

[DadJokes]

No, not a straw man. I couldn't quite figure out which one it was. A red herring maybe?

Yes, a red herring.   No one became a millionaire taking advantage of credit card points.  True statement.   But that's not an argument against using credit card points.

No one became a millionaire by picking up cash they found on the ground, but that doesn't mean I'm going to walk by a hundred dollar bill on the sidewalk...

[SmartyCat]

As for Dave Ramsey - I think he's crazy like a fox and laughing all the way to the bank. Marketing to churches is lucrative if you can find a good niche, and he certainly has. Have a lot of people benefited from community support and nicely-packaged common sense? Of course.

I used to listen to his show and found some homespun wisdom every once in a while (my favorite: powdered butt syndrome, ie, if you're talking to someone who has ever changed your diapers, they are highly unlikely to take financial advice from you). I also think the snowball method harnesses momentum from human nature (celebrating small wins as you pay smaller balances off quickly) even though it's not as mathematically sound as paying off higher-interest debt first.

But there were too many sacred cows - even when it made zero economic sense - playing to his core audience. The episode that cooked it for me was a single mom, home-schooling her three kids (in a country where public education is free), who had a bunch of debt from a now-ended marriage, and whose sole income was child support from the flaky ex-husband who couldn't hold a job for more than a few months at a time. Did Dave advise her to put her kids on the school bus and get a job posthaste? No he did not. He kept saying "big hole, small shovel" and affirming her decision to stay home. I still think about that woman and her kids and hope they're ok, because she got the worst possible advice that day.

[Telecaster]

Which brings up another point; I find those studies that say you spend more on plastic to be suspect; I find paper money tends to go through my hands quickly because it’s “already spent” out of the bank balance. Plastic money gets thought about more because I haven’t yet incurred the impact of spending it yet so I think about it more.

I think the issue with cash is once it is gone, it is gone and you can't spend anymore.  Not so much with credit cards. 

For sure, some people--maybe most people--have trouble with credit cards.  So those people shouldn't use them.  And in general using credit cards just to get the rewards is losing proposition.

But if you are disciplined, organized, and simply run all your normal spend through credit cards getting the rewards is almost a no-brainer, especially if you like to travel.  Some cards give you the equivalent of hundreds and even thousands of dollars just for signing up and making the spend.  Those rewards are just sitting on the table, it isn't that hard to simply scoop them up.

[nereo]

As for Dave Ramsey - I think he's crazy like a fox and laughing all the way to the bank. Marketing to churches is lucrative if you can find a good niche, and he certainly has. Have a lot of people benefited from community support and nicely-packaged common sense? Of course.

I used to listen to his show and found some homespun wisdom every once in a while (my favorite: powdered butt syndrome, ie, if you're talking to someone who has ever changed your diapers, they are highly unlikely to take financial advice from you). I also think the snowball method harnesses momentum from human nature (celebrating small wins as you pay smaller balances off quickly) even though it's not as mathematically sound as paying off higher-interest debt first.

But there were too many sacred cows - even when it made zero economic sense - playing to his core audience. The episode that cooked it for me was a single mom, home-schooling her three kids (in a country where public education is free), who had a bunch of debt from a now-ended marriage, and whose sole income was child support from the flaky ex-husband who couldn't hold a job for more than a few months at a time. Did Dave advise her to put her kids on the school bus and get a job posthaste? No he did not. He kept saying "big hole, small shovel" and affirming her decision to stay home. I still think about that woman and her kids and hope they're ok, because she got the worst possible advice that day.

His consistent misogyny and belief in a patriarchal world is a deal breaker for me. That “powdered butt syndrome” is another example of a subject we’ve been discussing at length about adults who don’t have good relations with their parents (summary: often it’s because the parents can’t treat their grown children as adults and social equals). My parents aren’t shy about asking my op opinions on their financial matters, and have followed even my unsolicited advice several times (“run from Edward Jones!!”)

Every show he highlights this “Father/Husband” knows best. His advice to husbands is different than wives (“well you’ve got to do
X because you’ve got a family to think about” vs “well have you discussed this at all with your husband?”)

His financial advice is often suboptimal and occasionally just plain terrible, but IMO his views on society, expressed through his comments and advice, are far worse and reason enough to stay away.

[shelivesthedream]

I've never listened to Dave Ramsey's show, but I hear about his financial advice while reading online quite often. I don't really see how you can argue that you wouldn't be in financially good shape if you followed his advice. You be debt free with an emergency fund and soon have a paid-off home and retirement fund. What's bad about that?

This forum skews to a particular personality type that wants to optimise everything and can tip over into unhealthy perfectionism. Good enough is good enough, and that's how some people live their entire lives - and are happy with it! If someone lives their entire life paying cash for everything and "missing out" on credit card rewards because of Dave Ramsey's material... is there really a problem here that needs solving?

I myself have moved upwards through several tiers of financial advic before settling at MMM level. If someone outgrows Dave Ramsey, they can seek out something else. But many people will live happily and prosper by making not-actually-completely-perfectly-optimal decisions. Which are not the same as suboptimal decisions as the word is usually used.

[nereo]

I've never listened to Dave Ramsey's show, but I hear about his financial advice while reading online quite often. I don't really see how you can argue that you wouldn't be in financially good shape if you followed his advice. You be debt free with an emergency fund and soon have a paid-off home and retirement fund. What's bad about that?

This forum skews to a particular personality type that wants to optimise everything and can tip over into unhealthy perfectionism. Good enough is good enough, and that's how some people live their entire lives - and are happy with it! If someone lives their entire life paying cash for everything and "missing out" on credit card rewards because of Dave Ramsey's material... is there really a problem here that needs solving?

I myself have moved upwards through several tiers of financial advic before settling at MMM level. If someone outgrows Dave Ramsey, they can seek out something else. But many people will live happily and prosper by making not-actually-completely-perfectly-optimal decisions. Which are not the same as suboptimal decisions as the word is usually used.

There’s broad consensus here that his advice - suboptimal and flawed as it may be at times - is far better than what many westerners practice in their daily lives.

The deeper problem is what else is conferred with those folksy sound-bites.  Personally, I find the “rest of his messaging” to negate the good his financial program may accomplish. As you’ve mentioned, he’s not the only financial guru on the internet, so there’s no reason to gloss over the bad because of the good.  And to be clear, he’s an evangelical christian who delights in calling people “idiots” and “morons”, thoroughly believes in the prosperity gospel, has deeply troubling policies for his employees with some seriously alleged sexist treatment of female staff, and frequently let’s patriarchal gender ideals shape his advice to callers. When he gets legitimate pushback he can get nasty, to the point of being a bully.

As an analogy, consider a chef that makes pretty good food but is lousy to his employees and espouses misogynistic and racist views.  Personally I see no reason to be his customer or recommend him to anyone despite his competency at cooking. Simply put there are much better options.

[Fishindude]

I've never listened to Dave Ramsey's show, but I hear about his financial advice while reading online quite often. I don't really see how you can argue that you wouldn't be in financially good shape if you followed his advice. You be debt free with an emergency fund and soon have a paid-off home and retirement fund. What's bad about that?

This forum skews to a particular personality type that wants to optimise everything and can tip over into unhealthy perfectionism. Good enough is good enough, and that's how some people live their entire lives - and are happy with it! If someone lives their entire life paying cash for everything and "missing out" on credit card rewards because of Dave Ramsey's material... is there really a problem here that needs solving?

I myself have moved upwards through several tiers of financial advic before settling at MMM level. If someone outgrows Dave Ramsey, they can seek out something else. But many people will live happily and prosper by making not-actually-completely-perfectly-optimal decisions. Which are not the same as suboptimal decisions as the word is usually used.

Great analogy.

Hey, if you don't like Dave, don't listen to him.    He's helped a ton of people dig themselves out of dire problems and has made himself and a good number of his managers very wealthy in doing so.
Sounds like a pretty great business model to me.

[TomTX]

I am literally dumbstruck by the idiocy in this post.

Or he’s just obtuse?  To what end?  What’s his angle here?


Literally every rich person I know uses CC points to pay for travel. Usually in its entirety. We’re taking a 10-day trip to Hawaii next year and it’s at least 50% paid for via hotel points and airline miles.

Um. We spent 4 weeks in Hawaii and almost everything was on points/miles: Airfare, hotels, rental car. Heck, a fair fraction of the meals and drinks because I had a high rating with the hotel points club or I had the right CC. And airport lounge access on the mainland.

I'm a piker compared to some guys I know. Maybe you won't get to be a millionaire on points/miles - but you can certainly travel like one. These guys have traveled all over internationally on points, often first class.

Funny story - one time I did take first class because it was actually fewer points for some reason. Glad I checked. Admittedly it was domestic "nominal first class".

[Telecaster]

Hey, if you don't like Dave, don't listen to him.    He's helped a ton of people dig themselves out of dire problems and has made himself and a good number of his managers very wealthy in doing so.
Sounds like a pretty great business model to me.

It does sound like a great business model.  He exploits vulnerable people who don't have good financial acumen by selling them expensive financial products they don't need. 

Great business model.  Horrible human being. 

[shelivesthedream]

Hey, if you don't like Dave, don't listen to him.    He's helped a ton of people dig themselves out of dire problems and has made himself and a good number of his managers very wealthy in doing so.
Sounds like a pretty great business model to me.

It does sound like a great business model.  He exploits vulnerable people who don't have good financial acumen by selling them expensive financial products they don't need.

Great business model.  Horrible human being.

I'm not sure if you're thinking of something particular here, or just general books and courses. I would argue that if someone is in financial trouble and has failed to make good decisions in the past, and Dave Ramsey's simplistic absolutist advice gets them out of debt and onto a path of financial stability, then they did need the expensive product.

"Don't outspend your income" is the same level of rocket science as "eat less, move more". But many people are overweight and unfit despite being abundantly versed in the simple theory of weight loss
So Dave Ramsey's products are the equivalent of a personal trainer. If they could get fit by just eating more salads and jogging, don't you think people would? If they could get rich by just spending less and saving more, don't you think they would?

He is an expert on the psychology of finance of his audience. Which, I'll admit, seems to be the mathematically illiterate who are devoid of any kind of willpower. But you don't give the same training to a couch potato and an Olympic sprinter, and you don't have the same standards for a "good result" from them.

I myself have manifestly failed multiple times to achieve any reasonable level of fitness. I am considering paying money in the future to the exercise equivalent of Dave Ramsey. I obviously do not have good exercise acumen and am in the class of physical idiot who needs an expensive product to replace common sense. If it helps me to do something I otherwise wouldn't, on what grounds can it be argued that I don't need it?

I've read up a bit recently on what you might call his "social messaging" (as opposed to his financial messaging). He sounds like an ass. But I will continue to defend his offering of sound financial advice to people lower on the Wheaton Scale* in a form that a substantial number of people are able to action when previous information has not catalysed change for them - even if the advice is not exactly perfectly completely optimised in every way.

*https://wiki.earlyretirementextreme.com/wiki/ERE_Wheaton_Levels

[Tinker]

I am literally dumbstruck by the idiocy in this post.

Or he’s just obtuse?  To what end?  What’s his angle here?


Literally every rich person I know uses CC points to pay for travel. Usually in its entirety. We’re taking a 10-day trip to Hawaii next year and it’s at least 50% paid for via hotel points and airline miles.

the intent here is not "pay for your travel with cash lol" but "why are you even travelling if you're not a millionaire?"
Don't get baited into FREE SHIT*  (*if you spend X more money here) type of advertising

[kpd905]

I started opening credit cards and bank accounts for the sign up bonuses in 2016, and I have made $65,000 since then.  So while this will not make me a millionaire, it doesn't hurt.  I just wish I had put it all into a separate investment account to see what it would have grown to, although it has pretty much all gone to daycare costs this whole time.

If you assume Dave Ramsey's 12% returns, then investing my $13,000 per year average would give you a million dollars in only 20 years.  So you could definitely become a millionaire investing only credit card/bank account earnings.

[use2betrix]

This is a site where people (generally) have good spending/saving habits and that’s what draws the members on a common base.

It’s a bit ignorant to assume there aren’t tons of people who struggle with that sense of self control.

Personally, I’m more amazed by people who don’t have self control in regards to exercise and healthy diets, than those with poor spending habits. Yet - if someone can give advice that helps millions and it may not be “the best option ever” but improves their lives significantly, then I think it’s good advice.

Sometimes the best advice is whatever you can actually get people to follow. If you’re only offering the “most optimal” but very few people can commit to it long term, it’s not nearly as positive of an impact.

I.e. - what would you prefer - helping 10 people save an extra 50% of their check, or help 10,000 people save an extra 25%?

[Fishindude]

It does sound like a great business model.  He exploits vulnerable people who don't have good financial acumen by selling them expensive financial products they don't need. 

Great business model.  Horrible human being.

You can get a whole lot of his stuff for free, just tune in and listen or go on his website and find the free stuff.   Many churches and other organizations run his programs for free.
Just checked his website and most of the store items run $100 or less.

I don't understand the hate (probably don't like his religious views) but every business needs to charge something for their products, or they aren't around long.
You also don't have to like a particular person to realize they are providing a good service / product.   I'm not a bill Gates fan but it's hard to argue that Microsoft isn't a pretty good product.

[TomTX]

It does sound like a great business model.  He exploits vulnerable people who don't have good financial acumen by selling them expensive financial products they don't need. 

Great business model.  Horrible human being.

You can get a whole lot of his stuff for free, just tune in and listen or go on his website and find the free stuff.   Many churches and other organizations run his programs for free.
Just checked his website and most of the store items run $100 or less.

I don't understand the hate (probably don't like his religious views) but every business needs to charge something for their products, or they aren't around long.
You also don't have to like a particular person to realize they are providing a good service / product.   I'm not a bill Gates fan but it's hard to argue that Microsoft isn't a pretty good product.

I don't have a problem with Dave's price points on his "get out of debt" program. As noted by others, for the millions of people with low financial willpower - it works.

I do have a problem with shilling his affiliated investment advisors (charging fees, sending Dave kickbacks) - especially coupled with unrealistic claims about returns.

[tipster350]

Ramsey is a disgrace as a person and as an employer. He is an angry, bloviating entitled, narcissistic, greedy, misogynistic, anti-masking miscreant. He takes advantage of and treats his employees like dirt and expects cult-like devotion, and exerts control over their personal lives. I would not give him the benefit of even a click on any of his material.

That being said, 95% of his basic advice is sound and useful to the average person. The debt snowball concept is particularly brilliant and is his signature contribution to the personal finance world. It considers the emotional and psychological aspects of money management, especially for those who feel overwhelmed and need a starting place where they will be able to quickly mark progress.

As has been stated, we on this forum are not at all representative of the population at large. We are on an entirely different level here. However, I've seen that Ramsey was the gateway into successful personal financial management for many here.

[Fishindude]

Ramsey is a disgrace as a person and as an employer. He is an angry, bloviating entitled, narcissistic, greedy, misogynistic, anti-masking miscreant. He takes advantage of and treats his employees like dirt and expects cult-like devotion, and exerts control over their personal lives. I would not give him the benefit of even a click on any of his material.

Wow !
So I'm guessing you have personal experience as an employee of the man?

[Gin1984]

I've never listened to Dave Ramsey's show, but I hear about his financial advice while reading online quite often. I don't really see how you can argue that you wouldn't be in financially good shape if you followed his advice. You be debt free with an emergency fund and soon have a paid-off home and retirement fund. What's bad about that?

This forum skews to a particular personality type that wants to optimise everything and can tip over into unhealthy perfectionism. Good enough is good enough, and that's how some people live their entire lives - and are happy with it! If someone lives their entire life paying cash for everything and "missing out" on credit card rewards because of Dave Ramsey's material... is there really a problem here that needs solving?

I myself have moved upwards through several tiers of financial advic before settling at MMM level. If someone outgrows Dave Ramsey, they can seek out something else. But many people will live happily and prosper by making not-actually-completely-perfectly-optimal decisions. Which are not the same as suboptimal decisions as the word is usually used.

Based on his advice, we would own our home and out net worth would be over $100,000, possible $200,000 less than it is.  I did the calculation a few years back when someone else made that argument.  His advice is very suboptimal.

[L8_apex]

Last week I had a cross-country drive and was frequently looking for radio stations in range.  I've never listened to Dave's radio show before but did so for a few hours.  All of his advice was simple, reasonable, and not really subject to argument, even from this crowd IMO. 

There was only one caller's situation where I disagreed with Dave's advice.  Caller had a home with mortgage and a rental home with a mortgage.  They called to ask about a cash-out refi on the residence to pay off the rental's loan.  Dave didn't want them to do that, whereas I would do it if it reduces total monthly payments. 

I get that this is an internet forum where we can dive into the minutiae of anything, but I find all of the judgmental comments about things like masks to be trite and pathetic.  Somebody at the company cheated on their partner and was fired, while another did the same and wasn't.  I'm not so morally righteous that I'm going to lynch them over that.  Woke PC culture, ugh.

[Morning Glory]

I get that this is an internet forum where we can dive into the minutiae of anything, but I find all of the judgmental comments about things like masks to be trite and pathetic.  Somebody at the company cheated on their partner and was fired, while another did the same and wasn't.  I'm not so morally righteous that I'm going to lynch them over that.  Woke PC culture, ugh.

Can you please explain how it's trite or pathetic to expect that a person in a position of authority (formal or informal) not turn a simple public health measure into a political issue? Or how expecting equal treatment for men and women in the workplace is an example of "woke PC culture?" 

[Dicey]

I use to listen to Clark Howard on AM radio as I fell asleep.   I've listened to him off and on for years.
Clark (he hates being called 'Mr. Howard) retired from radio.  The station replaced him with Dave Ramsey.
Mr Ramsey comes across as a very narrow minded stick in the mud.   The way he did it, years ago, is THE way, the ONLY way, for EVERYONE. 
Life isn't that simple.  His followers are missing out on a LOT of opportunities.
I've found a new station to listen to - they rotate the shows and/or hosts.  Not sure what their topics are, and don't care.

Thanks for this intel. I wondered what happened to him. I though it was just because I'm rarely in the car any more.

[shelivesthedream]

@Gin1984

Based on his advice, we would own our home and out net worth would be over $100,000, possible $200,000 less than it is.  I did the calculation a few years back when someone else made that argument.  His advice is very suboptimal

You say this because you are comparing Dave Ramsey to MMM. You need to compare Dave Ramsey to yer average consumer Joe/Jane and see if DR comes out ahead in THAT calculation. This link explains my point: https://wiki.earlyretirementextreme.com/wiki/ERE_Wheaton_Levels

[Metalcat]

Clearly some businesses aren't equipped to take cash. And clearly there is a cost and risk both to the customer and the retailer to use cash.  Neither was my point.  I don't presume to know the mind of Ramsey. Not a close follower of his, but I don't read too much into the tweet that was quoted.  It is, however, objectively true.  MMM would say so.  You can't spend your way to wealth.

With respect to using cards (or phones or wristwatches) to buy stuff, the nature of our present system is somewhat that you are damned if you do and damned if you don't.  If you pay cash/use debit cards and pay full price, you are subsidizing the points schemes through inflated prices, assuming risks and reaping almost no benefit.  So you might as well use a form of reward banking.  But it's no ticket to wealth. Just like ordering extra Arbonne each month to reach a higher level of commissions or earn a 'free' trip, you've paid for it all, yourself, well in advance of reaping any benefit.

If I can pay cash and get a discount, that's the route I'm going.  A 5-10% cash discount from small businesses is my experience.  I pick up take-out for a homebound relative 2x per week.  Two of my local sandwich shops (not chains) offer 7% discount to pay cash.  I got a 10% discount on a vehicle tow just 2 days ago.  We had 8% discounts on work done on our home from three separate contractors for paying cash over the past few years.

That's the "I'm not going to report this income on my taxes" discount, not the "I'm going to avoid a 3% merchant fee" discount. We use an appliance repair guy that takes cash and offers a discount equivalent to sales tax (about 8%). I too am happy to go pull a few hundred bucks from the ATM to save some money - but it's only those small businesses that are going to offer that discount.

The gun store i frequent (local mom and pop) gives a cash discount (on firearms only, not accessories or anmo) and it truly is the card swipe fee discount; every gun sale is background checked and paperwork filed with the ATF so you can’t fudge the numbers.  I think it’s 5-7% so truly is worth it to get the cash; almost any other time I don’t bother, but I almost never have more than about $50 on me/around the house so have to go out of my way to make large cash purchases.

Which brings up another point; I find those studies that say you spend more on plastic to be suspect; I find paper money tends to go through my hands quickly because it’s “already spent” out of the bank balance. Plastic money gets thought about more because I haven’t yet incurred the impact of spending it yet so I think about it more.

I have the same response to cash vs. credit. I regularly check the credit statements and can see exactly where the money goes and whether we need to rein in the spending. Once cash leaves the bank, I have no idea where it goes. The most cash I carry regularly is a quarter for an Aldi cart.

Around here, I only ever see the cash discount at gas stations. There are a few businesses that only accept cash, like a famous burger and beer joint and my husband's barber.

Glad I have company here! I always have a good idea of our account balances, but once cash comes out of the ATM and into my wallet? Eh. Might have $120 in there, might have $5 - it's no longer part of my tracking mechanism and doesn't feel quite real. That stat about people spending more on plastic may be evidence-based, but always feels like opposite day to me.

Same, cash just doesn't exist to me.

I have nearly $1000 in my wallet at the moment from selling my bike the other day, and I was shocked when the guy handed me cash instead of doing an e-transfer, I was like "what am I supposed to do with this colourful plastic-y paper you've given me???". It won't register as funds available to use until I deposit it.

[Telecaster]

You can get a whole lot of his stuff for free, just tune in and listen or go on his website and find the free stuff.   Many churches and other organizations run his programs for free.
Just checked his website and most of the store items run $100 or less.

I don't understand the hate (probably don't like his religious views) but every business needs to charge something for their products, or they aren't around long.
You also don't have to like a particular person to realize they are providing a good service / product.   I'm not a bill Gates fan but it's hard to argue that Microsoft isn't a pretty good product.

I don't give two hoots about his religion.   My issue is he gives objectively bad and needlessly expensive advice to people who don't know better.    Bad advice is not a good product.

For example, let's look at his advice on mutual funds:

You want an experienced manager calling the shots for your mutual fund­—someone with at least five to 10 years of experience. Keep in mind, though, that many managers mentor their successors for several years. So, a fund with a new manager can be worth considering if the fund has consistently performed well.

So you want an experienced manager, unless you don't want an experienced manager.   How is this good advice for beginners?  But it is bad advice for another reason:  Study after study has shown that the vast majority of actively managed funds underperform the index.    Recommending actively managed funds is straight up bad financial advice.  People who give bad financial advice are bad financial advisors by definition.  But it gets worse, read on:

We recommend front-end load funds. With this type of fund, you pay fees and commissions up front when you make your investment. This approach allows your money to grow without being bogged down by expensive management fees. Also pay attention to the fund’s expense ratio. A ratio higher than 1% is considered expensive.


That statement is either a flat out lie, or gross misunderstanding of how math works.   There is no discount for loaded funds.  The associative property of multiplication means it doesn't matter when you pay the fee.  Pay at the beginning or pay at the end.  Either way, your final balance is will be the same.   Suggesting there is a discount for paying in advance is flat out innumeracy.   And by the way, anything over about 0.1% is considered expensive by most people.   The Ramsay advice is it is okay to pay an order of magnitude more for a fund than is reasonable, and that's on top of the front load.    It is like saying it is okay to pay $100,000 for a car that is available for $10,000.   But you have to pay $10,000 before you can even buy the car.  It makes no financial sense at all.   If buy a mutual fund with a one percent load and a one percent fee, over say, a 40 year investing horizon (Even if you are 40 years old, your investing horizon is probably that long) you will easily pay enough in fees to buy a nice house.   That is, buy a nice house for the mutual fund salesman, not you.  How is this advice in the same universe as ethical?

I humbly submit that you shouldn't take financial advice from someone who is a liar or doesn't know 7th grade math. 

Which brings us to:

If this sounds like a lot of information to dig through and compare, that’s because it is! The good news is you don’t have to do it all alone. You can work with an investment pro who understands the ins and outs of the market but recognizes that you’re in charge of selecting your own retirement investments.

It is a lot of information to dig through.   The way DR puts it, it almost sounds overwhelming.   If I were trying to following his advice I don't even know where I would start.   And so that they helpfully suggest working with a pro.   Note:  They do not suggest you work with a fee only advisor.  Recommending new investors work with a commissioned based advisor is bad financial advice and in my opinion is unethical.   

Good news is most of DR criteria for selecting mutual funds is needlessly complicated bullshit designed to confuse people, so it can be safely disregarded.  Here's some better advice for someone just starting out in investing.

1.  Diversification is good.  So buy the entire market. 
2.  Fees are bad.   The market goes up and down but money lost to fees is gone forever.

So, an excellent good solution for new investors and even experienced investors is to simply buy VTSAX.   You will vastly outperform the Dave Ramsey approved front loaded, high fee mutual funds and that's pretty much all you have to do.

A very common question I see among newer investors at MMM is something like "should I diversify beyond VTSAX?"   The short answer is it is worth considering.   I personally do.  But there is no pressing need to do so, and there is no rush.   You can diversify as you become more informed as an investor--or not.   VTSAX gets most people where they need to be with the least amount of fuss.  DR recommends investing in four types of funds:   Growth, growth and income, aggressive growth, and international.   That's actually just three types:  Growth, income, and international (again, making stuff needless complicated).   You can replicate that yourself with a blended fund like VASGX. 

https://investor.vanguard.com/mutual-funds/profile/VASGX

It gives you almost spot on what DR recommends--growth, income, and international--but at a tiny fraction of the cost.  So why doesn't DR recommend VASGX?  It does everything he recommends.  It is simple, and no advisor necessary.  He doesn't recommend it because his gig is selling expensive financial products to people who don't know better.   

Should some people get a financial advisor?  Absolutely!   Not everyone has the time or inclination to track down all the stuff.  Hire a professional by all means, if you like.  But the advisor should be fee only.   They should not get a commission selling you expensive financial products you don't need.  That's simply predatory. 

Note:  At no point did I mention DR's religion or that he shouldn't make money at his job.  That's a strawman and you guys know it.   My objection is that he gives financial advice that is not only bad, it is borderline--if not over the border--unethical.   

[Plina]

Clearly some businesses aren't equipped to take cash. And clearly there is a cost and risk both to the customer and the retailer to use cash.  Neither was my point.  I don't presume to know the mind of Ramsey. Not a close follower of his, but I don't read too much into the tweet that was quoted.  It is, however, objectively true.  MMM would say so.  You can't spend your way to wealth.

With respect to using cards (or phones or wristwatches) to buy stuff, the nature of our present system is somewhat that you are damned if you do and damned if you don't.  If you pay cash/use debit cards and pay full price, you are subsidizing the points schemes through inflated prices, assuming risks and reaping almost no benefit.  So you might as well use a form of reward banking.  But it's no ticket to wealth. Just like ordering extra Arbonne each month to reach a higher level of commissions or earn a 'free' trip, you've paid for it all, yourself, well in advance of reaping any benefit.

If I can pay cash and get a discount, that's the route I'm going.  A 5-10% cash discount from small businesses is my experience.  I pick up take-out for a homebound relative 2x per week.  Two of my local sandwich shops (not chains) offer 7% discount to pay cash.  I got a 10% discount on a vehicle tow just 2 days ago.  We had 8% discounts on work done on our home from three separate contractors for paying cash over the past few years.

That's the "I'm not going to report this income on my taxes" discount, not the "I'm going to avoid a 3% merchant fee" discount. We use an appliance repair guy that takes cash and offers a discount equivalent to sales tax (about 8%). I too am happy to go pull a few hundred bucks from the ATM to save some money - but it's only those small businesses that are going to offer that discount.

The gun store i frequent (local mom and pop) gives a cash discount (on firearms only, not accessories or anmo) and it truly is the card swipe fee discount; every gun sale is background checked and paperwork filed with the ATF so you can’t fudge the numbers.  I think it’s 5-7% so truly is worth it to get the cash; almost any other time I don’t bother, but I almost never have more than about $50 on me/around the house so have to go out of my way to make large cash purchases.

Which brings up another point; I find those studies that say you spend more on plastic to be suspect; I find paper money tends to go through my hands quickly because it’s “already spent” out of the bank balance. Plastic money gets thought about more because I haven’t yet incurred the impact of spending it yet so I think about it more.

I have the same response to cash vs. credit. I regularly check the credit statements and can see exactly where the money goes and whether we need to rein in the spending. Once cash leaves the bank, I have no idea where it goes. The most cash I carry regularly is a quarter for an Aldi cart.

Around here, I only ever see the cash discount at gas stations. There are a few businesses that only accept cash, like a famous burger and beer joint and my husband's barber.

Glad I have company here! I always have a good idea of our account balances, but once cash comes out of the ATM and into my wallet? Eh. Might have $120 in there, might have $5 - it's no longer part of my tracking mechanism and doesn't feel quite real. That stat about people spending more on plastic may be evidence-based, but always feels like opposite day to me.

Same, cash just doesn't exist to me.

I have nearly $1000 in my wallet at the moment from selling my bike the other day, and I was shocked when the guy handed me cash instead of doing an e-transfer, I was like "what am I supposed to do with this colourful plastic-y paper you've given me???". It won't register as funds available to use until I deposit it.

For me neither. We had a change of bills a couple a years ago and when I sold my sofa I guessed I would get cash based on the buyer so I had to Google how the new bills looked and then it was a pain in the ass to find a place were to use the cash.

[Plina]

I get that this is an internet forum where we can dive into the minutiae of anything, but I find all of the judgmental comments about things like masks to be trite and pathetic.  Somebody at the company cheated on their partner and was fired, while another did the same and wasn't.  I'm not so morally righteous that I'm going to lynch them over that.  Woke PC culture, ugh.

Can you please explain how it's trite or pathetic to expect that a person in a position of authority (formal or informal) not turn a simple public health measure into a political issue? Or how expecting equal treatment for men and women in the workplace is an example of "woke PC culture?"

I find it ridiculous that a company even cares or are allowed to care who their employees sleep with as long as they don’t do it during working hours. Or fires someone for getting pregnant without being married. It is 2021 not 1821 or even 1921.

[OtherJen]

I get that this is an internet forum where we can dive into the minutiae of anything, but I find all of the judgmental comments about things like masks to be trite and pathetic.  Somebody at the company cheated on their partner and was fired, while another did the same and wasn't.  I'm not so morally righteous that I'm going to lynch them over that.  Woke PC culture, ugh.

Can you please explain how it's trite or pathetic to expect that a person in a position of authority (formal or informal) not turn a simple public health measure into a political issue? Or how expecting equal treatment for men and women in the workplace is an example of "woke PC culture?"

I find it ridiculous that a company even cares or are allowed to care who their employees sleep with as long as they don’t do it during working hours. Or fires someone for getting pregnant without being married. It is 2021 not 1821 or even 1921.

Yeah, I'm failing to see how it's a bad thing not to want to do business with someone who publicly treats employees poorly and seems proud of it. If that makes me "woke" and "PC," great. Those aren't insults.

[Dicey]

Great post, @Telecaster!

[Metalcat]

I get that this is an internet forum where we can dive into the minutiae of anything, but I find all of the judgmental comments about things like masks to be trite and pathetic.  Somebody at the company cheated on their partner and was fired, while another did the same and wasn't.  I'm not so morally righteous that I'm going to lynch them over that.  Woke PC culture, ugh.

Can you please explain how it's trite or pathetic to expect that a person in a position of authority (formal or informal) not turn a simple public health measure into a political issue? Or how expecting equal treatment for men and women in the workplace is an example of "woke PC culture?"

I find it ridiculous that a company even cares or are allowed to care who their employees sleep with as long as they don’t do it during working hours. Or fires someone for getting pregnant without being married. It is 2021 not 1821 or even 1921.

Yeah, I'm failing to see how it's a bad thing not to want to do business with someone who publicly treats employees poorly and seems proud of it. If that makes me "woke" and "PC," great. Those aren't insults.

Exactly, because holding businesses accountable for their blatant sexist mistreatment of women, and dangerous public health practices is just woke, PC bullshit???

If that's the case, then the bar for judging corporate practices is pretty fucking low. Like, blatant discrimination is just silly to care about?

What century is this?

[JLee]

I get that this is an internet forum where we can dive into the minutiae of anything, but I find all of the judgmental comments about things like masks to be trite and pathetic.  Somebody at the company cheated on their partner and was fired, while another did the same and wasn't.  I'm not so morally righteous that I'm going to lynch them over that.  Woke PC culture, ugh.

Can you please explain how it's trite or pathetic to expect that a person in a position of authority (formal or informal) not turn a simple public health measure into a political issue? Or how expecting equal treatment for men and women in the workplace is an example of "woke PC culture?"

I find it ridiculous that a company even cares or are allowed to care who their employees sleep with as long as they don’t do it during working hours. Or fires someone for getting pregnant without being married. It is 2021 not 1821 or even 1921.

Yeah, I'm failing to see how it's a bad thing not to want to do business with someone who publicly treats employees poorly and seems proud of it. If that makes me "woke" and "PC," great. Those aren't insults.

Exactly, because holding businesses accountable for their blatant sexist mistreatment of women, and dangerous public health practices is just woke, PC bullshit???

If that's the case, then the bar for judging corporate practices is pretty fucking low. Like, blatant discrimination is just silly to care about?

What century is this?

My general opinion is anyone who uses the phrase "woke PC culture" as an insult is living in the 1950's at best.

[valaraukar]

Have to remember - his audience is not mustachian in any way. He's catering to people who are at the very, very beginning of learning about financial responsibility.

I would go a step further and say that his true market is people who have deep-seated spendaholic problems and thus cannot be trusted with credit cards.

The challenge Dave Ramsey faces is that if he says "my message is for people who are irresponsible spendaholics; all you people who are responsible go stand over there and ignore me," then NOBODY ever wants to admit they are in the Irresponsible Spendaholic category, and his marketing destroys his business.

[mathlete]

There is a lot I don't like about Dave Ramsey. But he fills a niche. That niche is helping people who are bad with money, particularly those with a religious bent, avoid bad debt and get involved in investing.

His approach ignores a lot of positive uses of credit, and ideally (for him) has fund managers taking a haircut off of the gains of his followers. But if the only choices are maxed out credit cards or Ramsey Acolyte, the latter is probably better.

My parents have recently fallen down a Ramsey Youtube rabbit hole. Consequently, they've made relatively fewer of what I would call, dumb purchases.

Of course, there is a little devil in the back of my head making me think about how they're currently in the "Dave Ramsey DESTROYS financially irresponsible caller" rabbit hole, which one is next?

[Chris22]

Have to remember - his audience is not mustachian in any way. He's catering to people who are at the very, very beginning of learning about financial responsibility.

I would go a step further and say that his true market is people who have deep-seated spendaholic problems and thus cannot be trusted with credit cards.

The challenge Dave Ramsey faces is that if he says "my message is for people who are irresponsible spendaholics; all you people who are responsible go stand over there and ignore me," then NOBODY ever wants to admit they are in the Irresponsible Spendaholic category, and his marketing destroys his business.

The other thing is most alcoholics understand that everyone else isn’t an alcoholic, so “absolutely abstain from all alcohol ever” is specific advice aimed at them, with a problem.

Most Ramseyites don’t seem to get that his advice is aimed at them with a problem, and not necessarily to be followed to a T by everyone else. So they go around spouting it at people who don’t need it.

[dandarc]

Most Ramseyites don’t seem to get that his advice is aimed at them with a problem, and not necessarily to be followed to a T by everyone else. So they go around spouting it at people who don’t need it.

I know there was a time when I did that - glad I eventually "graduated" to better financial practices.

[DadJokes]

Ramsey is a disgrace as a person and as an employer. He is an angry, bloviating entitled, narcissistic, greedy, misogynistic, anti-masking miscreant. He takes advantage of and treats his employees like dirt and expects cult-like devotion, and exerts control over their personal lives. I would not give him the benefit of even a click on any of his material.

Wow !
So I'm guessing you have personal experience as an employee of the man?

If you did one iota of research (such as reading links posted earlier in this thread), you'd see that you don't need to have worked there to realize that he is a terrible employer.

Some notable items:
-Has pulled out a gun in a meeting to make a point
-Doesn't let employees (or caterers at a company event) wear masks
-Fired an employee for pre-marital sex (she was pregnant and unmarried), while allowing a big personality to remain employed despite multiple extramarital affairs.
-Believed that he should have gotten regular updates from marriage counselor regarding the employee with affairs

[mathlete]

If you did one iota of research (such as reading links posted earlier in this thread), you'd see that you don't need to have worked there to realize that he is a terrible employer.

Some notable items:
-Has pulled out a gun in a meeting to make a point
-Doesn't let employees (or caterers at a company event) wear masks
-Fired an employee for pre-marital sex (she was pregnant and unmarried), while allowing a big personality to remain employed despite multiple extramarital affairs.
-Believed that he should have gotten regular updates from marriage counselor regarding the employee with affairs

Wow. I didn't know any of this. Big yikes!

[Morning Glory]

If you did one iota of research (such as reading links posted earlier in this thread), you'd see that you don't need to have worked there to realize that he is a terrible employer.

Some notable items:
-Has pulled out a gun in a meeting to make a point
-Doesn't let employees (or caterers at a company event) wear masks
-Fired an employee for pre-marital sex (she was pregnant and unmarried), while allowing a big personality to remain employed despite multiple extramarital affairs.
-Believed that he should have gotten regular updates from marriage counselor regarding the employee with affairs

Wow. I didn't know any of this. Big yikes!

I saw that article a while back, the gun thing is just scary.

[PMG]

I read that article.  Is that anywhere considered a normal and acceptable way for a boss/CEO to speak to their employees? 

In regards to the employee fired for premarital sex suing:“I am sick of dealing with all this stuff,” Ramsey bellowed, according to a recording obtained by Religion News Service. “I’m so tired of being falsely accused of being a jerk when all I’m doing is trying to help people stay in line.”

Ramsey recommends that companies vet spouses to make sure their hire is not “married to crazy.” “When hiring someone, you are employing more than just the person,” his website advises. “You’re taking on the whole family. And when they are married to someone who is domineering, unstable or simply full of drama, you’ll end up with a team member who can’t be creative, productive or excellent.”

When someone reported their covid related OSHA violations: “So whoever you are, you moron, you did absolutely no good, except piss me off,” he told staff. “You are not welcome here if you are willing to do stuff like that. If you are really scared and you really think that leadership is trying to kill you … please, we love you. Just leave. We really don’t want you here.” He warned employees not to contact anyone outside the building with their concerns. “If you really think the people here are evil, bad people and you think that you can effect change by reaching outside of here, you are wrong,” he said. “And you are not welcome.”

I can't imagine willingly staying in that environment. Is this normal and tolerable in some circles?  Have I just been lucky to avoid it!?

I think little is gained by name calling, but the more that I learn about this man and his business the less respect I have. I'd rather point new people to bitchesgetriches or ohmydollar.  There are a lot of resources out there that don't come with so many strings attached.

[nereo]

I saw that article a while back, the gun thing is just scary.

DR is very fond of his firearms. For seemingly no reason he will often mention how he carries a concealed weapon permit but not a credit card. A few times I’ve heard him bully interviewers by telling them he might be carrying a loaded pistol.

[Morning Glory]

I've worked at a place that was cultlike, but not to that extreme. They didn't care what you did on your day off as long as you didn't criticize them on social media, or end up in the news, or suggest that they might be something other than the best. If you had on your social media that you worked there, you were held to a higher standard and could get fired for anything you did or said that could potentially embarrass them. They made a big show of not being discriminatory but it was much easier to get promoted if you were a white dude.  They hated unions and would have their managers spew antiunion rhetoric any chance they got.
You know, how most places are.

Firing someone for getting pregnant is certainly not very Christian, especially for an organization that is supposedly anti-abortion. I wonder how many abortions happened specifically because of that policy?

[tipster350]

I saw that article a while back, the gun thing is just scary.

DR is very fond of his firearms. For seemingly no reason he will often mention how he carries a concealed weapon permit but not a credit card. A few times I’ve heard him bully interviewers by telling them he might be carrying a loaded pistol.

I wonder what frightens him so much on a daily basis that he has to go around warning that he is armed? Or could he be trying to compensate for a lack of, shall we say, adequate manhood?

[PDXTabs]

I saw that article a while back, the gun thing is just scary.

DR is very fond of his firearms. For seemingly no reason he will often mention how he carries a concealed weapon permit but not a credit card. A few times I’ve heard him bully interviewers by telling them he might be carrying a loaded pistol.

I wonder what frightens him so much on a daily basis that he has to go around warning that he is armed? Or could he be trying to compensate for a lack of, shall we say, adequate manhood?

It's also just a bad strategy. I understand wanting to be armed. I don't understand telling everyone. It opens you up to liability as well as getting shot first.

[mathlete]

I saw that article a while back, the gun thing is just scary.

DR is very fond of his firearms. For seemingly no reason he will often mention how he carries a concealed weapon permit but not a credit card. A few times I’ve heard him bully interviewers by telling them he might be carrying a loaded pistol.

I don't like guns, but I cope with the fact that it's an imbedded part of the US constitution. For the most part, I trust and get along fine with gun owners. If they take gun safety seriously, there's not much to worry about. Maybe some of them concealed carry, I truly don't know.

I don't really get nervous about someone being a gun owner until they start in on the, "YEAH I HAVE A GUN!! It's one me right now. I sleep with it. It's loaded bucko. Come and take it! See what happens!"

This sounds like someone who goes through life hoping they'll get the opportunity to shoot someone.

[Morning Glory]

I saw that article a while back, the gun thing is just scary.

DR is very fond of his firearms. For seemingly no reason he will often mention how he carries a concealed weapon permit but not a credit card. A few times I’ve heard him bully interviewers by telling them he might be carrying a loaded pistol.

I don't like guns, but I cope with the fact that it's an imbedded part of the US constitution. For the most part, I trust and get along fine with gun owners. If they take gun safety seriously, there's not much to worry about. Maybe some of them concealed carry, I truly don't know.

I don't really get nervous about someone being a gun owner until they start in on the, "YEAH I HAVE A GUN!! It's one me right now. I sleep with it. It's loaded bucko. Come and take it! See what happens!"

This sounds like someone who goes through life hoping they'll get the opportunity to shoot someone.

 With as many workplace mass shootings as we've had I don't know why or if it's legal to wave it around at a work place.

[Chris22]

I saw that article a while back, the gun thing is just scary.

DR is very fond of his firearms. For seemingly no reason he will often mention how he carries a concealed weapon permit but not a credit card. A few times I’ve heard him bully interviewers by telling them he might be carrying a loaded pistol.

I don't like guns, but I cope with the fact that it's an imbedded part of the US constitution. For the most part, I trust and get along fine with gun owners. If they take gun safety seriously, there's not much to worry about. Maybe some of them concealed carry, I truly don't know.

I don't really get nervous about someone being a gun owner until they start in on the, "YEAH I HAVE A GUN!! It's one me right now. I sleep with it. It's loaded bucko. Come and take it! See what happens!"

This sounds like someone who goes through life hoping they'll get the opportunity to shoot someone.

 With as many workplace mass shootings as we've had I don't know why or if it's legal to wave it around at a work place.

It’s generally not. It’s called “brandishing” and it’s generally illegal, as long as it’s in “an angry or threatening way”. So “here’s my gun, would you like to see it?” Is not illegal. “Here’s my gun, don’t fuck with me”, is.

[GuitarStv]

I saw that article a while back, the gun thing is just scary.

DR is very fond of his firearms. For seemingly no reason he will often mention how he carries a concealed weapon permit but not a credit card. A few times I’ve heard him bully interviewers by telling them he might be carrying a loaded pistol.

I don't like guns, but I cope with the fact that it's an imbedded part of the US constitution. For the most part, I trust and get along fine with gun owners. If they take gun safety seriously, there's not much to worry about. Maybe some of them concealed carry, I truly don't know.

I don't really get nervous about someone being a gun owner until they start in on the, "YEAH I HAVE A GUN!! It's one me right now. I sleep with it. It's loaded bucko. Come and take it! See what happens!"

This sounds like someone who goes through life hoping they'll get the opportunity to shoot someone.

 With as many workplace mass shootings as we've had I don't know why or if it's legal to wave it around at a work place.

It’s generally not. It’s called “brandishing” and it’s generally illegal, as long as it’s in “an angry or threatening way”. So “here’s my gun, would you like to see it?” Is not illegal. “Here’s my gun, don’t fuck with me”, is.

How many people are arrested for brandishing a weapon in the US each year?

[nereo]

I saw that article a while back, the gun thing is just scary.

DR is very fond of his firearms. For seemingly no reason he will often mention how he carries a concealed weapon permit but not a credit card. A few times I’ve heard him bully interviewers by telling them he might be carrying a loaded pistol.

I don't like guns, but I cope with the fact that it's an imbedded part of the US constitution. For the most part, I trust and get along fine with gun owners. If they take gun safety seriously, there's not much to worry about. Maybe some of them concealed carry, I truly don't know.

I don't really get nervous about someone being a gun owner until they start in on the, "YEAH I HAVE A GUN!! It's one me right now. I sleep with it. It's loaded bucko. Come and take it! See what happens!"

This sounds like someone who goes through life hoping they'll get the opportunity to shoot someone.

 With as many workplace mass shootings as we've had I don't know why or if it's legal to wave it around at a work place.

It’s generally not. It’s called “brandishing” and it’s generally illegal, as long as it’s in “an angry or threatening way”. So “here’s my gun, would you like to see it?” Is not illegal. “Here’s my gun, don’t fuck with me”, is.

How many people are arrested for brandishing a weapon in the US each year?

Quite a few. Most of them are black and brown.

[Chris22]

I saw that article a while back, the gun thing is just scary.

DR is very fond of his firearms. For seemingly no reason he will often mention how he carries a concealed weapon permit but not a credit card. A few times I’ve heard him bully interviewers by telling them he might be carrying a loaded pistol.

I don't like guns, but I cope with the fact that it's an imbedded part of the US constitution. For the most part, I trust and get along fine with gun owners. If they take gun safety seriously, there's not much to worry about. Maybe some of them concealed carry, I truly don't know.

I don't really get nervous about someone being a gun owner until they start in on the, "YEAH I HAVE A GUN!! It's one me right now. I sleep with it. It's loaded bucko. Come and take it! See what happens!"

This sounds like someone who goes through life hoping they'll get the opportunity to shoot someone.

 With as many workplace mass shootings as we've had I don't know why or if it's legal to wave it around at a work place.

It’s generally not. It’s called “brandishing” and it’s generally illegal, as long as it’s in “an angry or threatening way”. So “here’s my gun, would you like to see it?” Is not illegal. “Here’s my gun, don’t fuck with me”, is.

How many people are arrested for brandishing a weapon in the US each year?

Not sure what your point is, but it’s not uncommon.

You can easily get yourself arrested if you get the wrong cop for “printing”, I.e. having a concealed weapon inadvertently show (bend over, shirt rides up, etc etc).  In Texas?  Probably not. In Cook County, IL where I live?  Fairly easily.

[GuitarStv]

I saw that article a while back, the gun thing is just scary.

DR is very fond of his firearms. For seemingly no reason he will often mention how he carries a concealed weapon permit but not a credit card. A few times I’ve heard him bully interviewers by telling them he might be carrying a loaded pistol.

I don't like guns, but I cope with the fact that it's an imbedded part of the US constitution. For the most part, I trust and get along fine with gun owners. If they take gun safety seriously, there's not much to worry about. Maybe some of them concealed carry, I truly don't know.

I don't really get nervous about someone being a gun owner until they start in on the, "YEAH I HAVE A GUN!! It's one me right now. I sleep with it. It's loaded bucko. Come and take it! See what happens!"

This sounds like someone who goes through life hoping they'll get the opportunity to shoot someone.

 With as many workplace mass shootings as we've had I don't know why or if it's legal to wave it around at a work place.

It’s generally not. It’s called “brandishing” and it’s generally illegal, as long as it’s in “an angry or threatening way”. So “here’s my gun, would you like to see it?” Is not illegal. “Here’s my gun, don’t fuck with me”, is.

How many people are arrested for brandishing a weapon in the US each year?

Not sure what your point is, but it’s not uncommon.

You can easily get yourself arrested if you get the wrong cop for “printing”, I.e. having a concealed weapon inadvertently show (bend over, shirt rides up, etc etc).  In Texas?  Probably not. In Cook County, IL where I live?  Fairly easily.

I didn't have a point, just curious.

Open carry is legal in 16 states, so I'd expect a pretty large number of brandishing arrests in these places if the laws are actually enforced.