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 106390 times)

Offline ExGingi

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Re: Dave Ramsey Plan
« Reply #360 on: August 02, 2020, 06:52:35 PM »
https://www.investopedia.com/ask/answers/07/401(k)_ira.asp

I stand corrected. It does depend on income

https://www.irs.gov/retirement-plans/plan-participant-employee/2020-ira-contribution-and-deduction-limits-effect-of-modified-agi-on-deductible-contributions-if-you-are-covered-by-a-retirement-plan-at-work

Household income would need to be under $104,000 to make it fully deductible.

But now going back to ACA eligibility, I am not sure that it would be treated any different than on the tax side.
« Last Edit: August 02, 2020, 06:58:16 PM by ExGingi »
I've been waiting over 5 years with bated breath for someone to say that!
-- Dan

Offline Joe4007

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Re: Dave Ramsey Plan
« Reply #361 on: August 02, 2020, 07:03:20 PM »
I stand corrected. It does depend on income

https://www.irs.gov/retirement-plans/plan-participant-employee/2020-ira-contribution-and-deduction-limits-effect-of-modified-agi-on-deductible-contributions-if-you-are-covered-by-a-retirement-plan-at-work

Household income would need to be under $104,000 to make it fully deductible.

But now going back to ACA eligibility, I am not sure that it would be treated any different than on the tax side.
Well, it explicitly says no work retirement account and they're pretty much talking about households earning less than 104k.

Offline 12HRS

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Re: Dave Ramsey Plan
« Reply #362 on: August 03, 2020, 01:01:14 AM »
You're correct, I made a mistake. The second spouse can still contribute $6k to an IRA.

how many spouses are there?

Online avromie7

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Re: Dave Ramsey Plan
« Reply #363 on: August 03, 2020, 09:22:18 AM »
how many spouses are there?
Whoops, I meant "the spouse".
I wonder what people who type "u" instead of "you" do with all their free time.

Offline Kobe Bryant

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Re: Dave Ramsey Plan
« Reply #364 on: November 11, 2020, 12:53:05 PM »
A little ironic that I got tagged in a thread that started after I quit DDF about a topic I got into since I quit  :)

I read some of the thread, but not all, so forgive me if I'm repeating things.

1) DR is catering to people who are stuck in debt. These are people who made mistakes and didn't know how to handle money. If they had good financial planning knowledge, they wouldn't be in the mess in the first place. Saying something like "Why would you pay off lower interest first?" and following that up with "I've always had financial freedome [and never been in debt]" shows you aren't the DR target.

Take me for example, and I'm saying this even though I'm not anonymous. I found DD and started opening up credit cards and earning miles. It was awesome. Did a whole bunch of things I could never have afforded. Paid my bills on time, had a amazing credit score without a penny to my name. Life happened. Expenses ended up being more than I was earning. One job cut my salary by 40% rather than fire me outright. I was never an extravagant spender, don't have a car, live in a small apartment, but the CC bills became unpayable. I did 0% balance transfers and was treading water for a while. Then I missed a payment on one card. Then another on a different card. Before I knew it I was 80k in the whole, with no shovel to dig out of it.

I hate to say it, but I worry that more DD(F)ers fell into this than we like to imagine. No CC farms, no swiping scams, just spending more than we can afford to on high interest CCs.

2) As such, the DR advice is not necessarily the most mathermatically sound advice. He says so himself. It's behavioral. It's about planning, budgeting, and being in control. It is absolutely beneficial for the kinds of people in point 1 above to pay off a smaller debts earlier, even if it is lower intrest. The whole point is to change behaviour, not be the most optimal mathematical plan.

3) I have learned his plan without reading his book (though I could, for free, at the library) or paying him a penny. I've listened to him on youtube and I got the picture. The fact that he has built a multi million dollar self help and media empire doesn't mean he preys on anyone. And even if it would have cost me $100 to learn his plan, it would have been the best $100 I'd have ever spent.

4) Some people have mentioned $1000 not being enough of an emergency fund. True, that's why it's called a *beginners* emergency fund. Step 3 grows that to 3-6 months of expenses.

5) All the talk of WL vs Mutual funds, etc. - once you get into step 4,5 & 6 you should be speaking to an advisor who can go through the options with you.

Thank G-d, I should be debt free within a month, and complete step 3 soon after that. Then I can come back to DDF to hear the outcome of the arguements for step 4, 5 and 6. :)
What a great post.

Offline zh cohen

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Re: Dave Ramsey Plan
« Reply #365 on: November 11, 2020, 08:31:36 PM »
I'll try put something together, bl"n.

Any chance we get this?

(And thanks @Kobe Bryant for bumping this thread)

Offline Kobe Bryant

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Re: Dave Ramsey Plan
« Reply #366 on: November 12, 2020, 12:01:08 AM »
@Yehuda57 embodies this quote from DR “A man with an experience is not at the mercy of a man with an opinion.”

Offline Yehuda57

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Re: Dave Ramsey Plan
« Reply #367 on: November 12, 2020, 11:46:25 AM »
Any chance we get this?


I wrote a draft, but as I am not anonymous, it's a little tougher than I thought

Offline Kobe Bryant

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Re: Dave Ramsey Plan
« Reply #368 on: November 12, 2020, 11:52:22 AM »
I wrote a draft, but as I am not anonymous, it's a little tougher than I thought
If I were in your shoes, I wouldn’t.

Offline CountValentine

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Re: Dave Ramsey Plan
« Reply #369 on: November 12, 2020, 03:33:54 PM »
I wrote a draft, but as I am not anonymous, it's a little tougher than I thought
Go for it. It might inspire others that need a push.
Only on DDF does 24/6 mean 24/5/half/half

Offline Mordyk

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Re: Dave Ramsey Plan
« Reply #370 on: November 12, 2020, 03:44:22 PM »
If I were in your shoes, I wouldn’t.
why not?

Offline JACKBLUE

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Re: Dave Ramsey Plan
« Reply #371 on: November 12, 2020, 03:47:57 PM »
I wrote a draft, but as I am not anonymous, it's a little tougher than I thought
Smart, maybe PM if anyone needs it as Chizuk.....

Offline yuneeq

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Re: Dave Ramsey Plan
« Reply #372 on: November 12, 2020, 04:15:40 PM »
I wrote a draft, but as I am not anonymous, it's a little tougher than I thought

Put it on a password-protected website, and charge membership to get access :)
Visibly Jewish

Offline Yehuda57

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Re: Dave Ramsey Plan
« Reply #373 on: November 12, 2020, 04:20:10 PM »
Put it on a password-protected website, and charge membership to get access :)

But if I'm not accepting credit cards, how will I get paid?

Offline Mordyk

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Re: Dave Ramsey Plan
« Reply #374 on: November 12, 2020, 04:21:17 PM »
But if I'm not accepting credit cards, how will I get paid?
he doesn't say don't accept credit cards, he says don't use them. ;)
#TYH

Offline Kobe Bryant

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Re: Dave Ramsey Plan
« Reply #375 on: November 12, 2020, 04:21:45 PM »
But if I'm not accepting credit cards, how will I get paid?
Debit cards.

Offline CountValentine

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Re: Dave Ramsey Plan
« Reply #376 on: November 12, 2020, 04:26:06 PM »
But if I'm not accepting credit cards, how will I get paid?
I will collect for you.  ;)
Only on DDF does 24/6 mean 24/5/half/half

Offline yesitsme

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Re: Dave Ramsey Plan
« Reply #377 on: November 12, 2020, 10:03:11 PM »
Just post what a friend asked you to post, or can post in my name

Offline Yehuda57

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Re: Dave Ramsey Plan
« Reply #378 on: November 12, 2020, 11:11:43 PM »
Just post what a friend asked you to post, or can post in my name

why not?

Suffice it to say that getting into that much debt impacts many people and aspects in and of your life. An honest telling of my story, which is what a compelling DDMS would require, would mean publicizing details I didn't include in my DDF post, and which I wouldn't want public.
וד"ל

Offline CountValentine

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Re: Dave Ramsey Plan
« Reply #379 on: November 13, 2020, 06:58:25 AM »
What about how you are progressing? Which step are you tackling now?
Only on DDF does 24/6 mean 24/5/half/half