Poll

What baby step are you up to?

$1,000 Rainy day fund
Pay off all debt using the debt snowball
3 to 6 months of expenses in savings
Invest 15% of household income into Roth IRAs and pre-tax retirement (401k Etc.)
College /Simcha fund for children
Pay off home early (prepay mortgage)
Build wealth and give!

Author Topic: Dave Ramsey Plan  (Read 11876 times)

Offline ExGingi

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Re: Dave Ramsey Plan
« Reply #45 on: July 23, 2020, 06:40:22 PM »
Remember this is the guy who said never use CC's but took a CC for his course.  ::)

I happened to go out to pick up a target order the other week, and DR was on the radio. It so happened that someone called to discuss life insurance with him, and he admitted that he has life insurance (IINM $2MM) but gave the excuse that it was only because his wife wanted it.
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline ExGingi

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Re: Dave Ramsey Plan
« Reply #46 on: July 23, 2020, 06:43:31 PM »
Because you greatly reduced your risk of foreclosure when you don't have a mortgage.

IDK. Recent history has shown that having a large mortgage can sometimes work out well. I remember the person who I helped with a modification about a decade ago who was kicking himself and cursing for having paid down his mortgage.

DR himself would be the first to admit that paying down a mortgage doesn't make sense financially and mathematically. It's an emotional thing.

BTW. Some people are actually at greater risk due to the fact that they don't have the bank on top of them making the real estate tax payments. Falling behind on those can be very costly.
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline Kobe bryent

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Re: Dave Ramsey Plan
« Reply #47 on: July 23, 2020, 06:48:44 PM »
I happened to go out to pick up a target order the other week, and DR was on the radio. It so happened that someone called to discuss life insurance with him, and he admitted that he has life insurance (IINM $2MM) but gave the excuse that it was only because his wife wanted it.
Whole life insurance? Not a chance!

Offline ExGingi

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Re: Dave Ramsey Plan
« Reply #48 on: July 23, 2020, 06:51:07 PM »
Whole life insurance? Not a chance!

He didn't say what kind he has. I don't know how old he or his wife are, nor at what age he might have purchased it.

Honestly, when one doesn't need insurance, it's beyond me why they would get term rather than a properly overfunded whole life. Reminds me of what I used to tell my wife when we were newlyweds and she would go shopping: spend as much as you want, but don't waste any.
« Last Edit: July 23, 2020, 06:54:13 PM by ExGingi »
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline moko

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Re: Dave Ramsey Plan
« Reply #49 on: July 23, 2020, 07:00:16 PM »
He didn't say what kind he has. I don't know how old he or his wife are, nor at what age he might have purchased it.

Honestly, when one doesn't need insurance, it's beyond me why they would get term rather than a properly overfunded whole life. Reminds me of what I used to tell my wife when we were newlyweds and she would go shopping: spend as much as you want, but don't waste any.
if you don't need insurance, why WL vs investing in S&P
Using your g-d given right of stupidity is an option, not a requirement. Please use sparingly.

Offline ExGingi

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Re: Dave Ramsey Plan
« Reply #50 on: July 23, 2020, 07:06:52 PM »
if you don't need insurance, why WL vs investing in S&P

Why have an apple vs an orange?
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline Kobe bryent

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Re: Dave Ramsey Plan
« Reply #51 on: July 23, 2020, 07:07:05 PM »
IDK. Recent history has shown that having a large mortgage can sometimes work out well. I remember the person who I helped with a modification about a decade ago who was kicking himself and cursing for having paid down his mortgage.

DR himself would be the first to admit that paying down a mortgage doesn't make sense financially and mathematically. It's an emotional thing.

BTW. Some people are actually at greater risk due to the fact that they don't have the bank on top of them making the real estate tax payments. Falling behind on those can be very costly.
Care to elaborate on what happened?
"DR himself would be the first to admit..." you don't seem to familiar with the DRP.
Do you actually believe this? let me get this straight, so one who has paid down 500k aggressively over 15 years and has a paid for house, is in a worse financial position than one who has a mortgage?!

Offline Kobe bryent

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Re: Dave Ramsey Plan
« Reply #52 on: July 23, 2020, 07:12:12 PM »
if you don't need insurance, why WL vs investing in S&P
Why have an apple vs an orange?
Not convinced. And I am your target audience.

Offline zh cohen

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Re: Dave Ramsey Plan
« Reply #53 on: July 23, 2020, 07:14:29 PM »
I happened to go out to pick up a target order the other week, and DR was on the radio. It so happened that someone called to discuss life insurance with him, and he admitted that he has life insurance (IINM $2MM) but gave the excuse that it was only because his wife wanted it.
The attack you are responding to is based on the fact that the he set up a system to take card payments, and asked that people only use debit cards but didn't set up the system to reject Credit cards.

He has term life, and he has said many times that for him it's a waste of money. (A waste of money that he can well afford)

Offline Kobe bryent

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Re: Dave Ramsey Plan
« Reply #54 on: July 23, 2020, 07:14:59 PM »
Honestly, when one doesn't need insurance, it's beyond me why they would get term rather than investing in retirement accounts and mutual funds.
FTFY

Offline Kobe bryent

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Re: Dave Ramsey Plan
« Reply #55 on: July 23, 2020, 07:17:26 PM »
The attack you are responding to is based on the fact that the he set up a system to take card payments, and asked that people only use debit cards but didn't set up the system to reject Credit cards.

He has term life, and he has said many times that for him it's a waste of money. (A waste of money that he can well afford)

I am sure you are familiar with the "Stupid Tax" I would put this in the "SB Tax" column.

Offline ExGingi

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Re: Dave Ramsey Plan
« Reply #56 on: July 23, 2020, 07:18:41 PM »
Care to elaborate on what happened?
"DR himself would be the first to admit..." you don't seem to familiar with the DRP.
Do you actually believe this? let me get this straight, so one who has paid down 500k aggressively over 15 years and has a paid for house, is in a worse financial position than one who has a mortgage?!

By paying down the mortgage, all this person has done is convert a highly liquid and safe asset (cash) into a not so liquid and non-guaranteed asset (equity in a home). Said person earned a compound rate of return equal to the interest rate on the mortgage (around 3% in today's market), while possibly forgoing a tax deduction.
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline CountValentine

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Re: Dave Ramsey Plan
« Reply #57 on: July 23, 2020, 07:22:46 PM »
I happened to go out to pick up a target order the other week, and DR was on the radio. It so happened that someone called to discuss life insurance with him, and he admitted that he has life insurance (IINM $2MM) but gave the excuse that it was only because his wife wanted it.
His wife made him take CC's to.  ;)
You're so far up Trump's a** you can see Giuliani's feet.  HT Baruch

Offline zh cohen

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Re: Dave Ramsey Plan
« Reply #58 on: July 23, 2020, 07:28:15 PM »
His wife made him take CC's to.  ;)

I know that on CB forums they consider this argument enough to reject everything Dave Ramsey says, but I think here we can have an honest discussion about the good and bad of his program.

Offline zh cohen

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Re: Dave Ramsey Plan
« Reply #59 on: July 23, 2020, 07:30:51 PM »
By paying down the mortgage, all this person has done is convert a highly liquid and safe asset (cash) into a not so liquid and non-guaranteed asset (equity in a home). Said person earned a compound rate of return equal to the interest rate on the mortgage (around 3% in today's market), while possibly forgoing a tax deduction.

Do you recommend that people borrow against their home to invest (or to have "highly liquid and safe" cash)? If not, why?