Comments on: Is it time to kick Dave Ramsey to the curb? http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/ Trying to live large ...one step at a time Thu, 18 Mar 2010 05:23:17 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: andy http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/comment-page-1/#comment-4616 andy Sun, 21 Dec 2008 05:50:16 +0000 http://www.livingalmostlarge.com/?p=2556#comment-4616 A lot of these financial experts, including DR, need to look at some of their theories in the current context and revisit some principles like those you mention here. A lot of these financial experts, including DR, need to look at some of their theories in the current context and revisit some principles like those you mention here.

]]> By: LivingAlmostLarge http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/comment-page-1/#comment-4614 LivingAlmostLarge Thu, 18 Dec 2008 02:25:15 +0000 http://www.livingalmostlarge.com/?p=2556#comment-4614 I don't know, do most people consider it storm clouds? Or do most following DR not consider it storm clouds until they are fired? I don’t know, do most people consider it storm clouds? Or do most following DR not consider it storm clouds until they are fired?

]]> By: Barb1954 http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/comment-page-1/#comment-4615 Barb1954 Wed, 17 Dec 2008 21:59:45 +0000 http://www.livingalmostlarge.com/?p=2556#comment-4615 If you read DR's books or ever listen to his radio show, he does advise that if you see storm clouds on the horizon, you should save as much and pay just the minimum on debt. If the current economic conditions are storm clouds, then I don't know what is. I also agree that one should never pass up the opportunity to get your employer's matching money in a 401(k). If you read DR’s books or ever listen to his radio show, he does advise that if you see storm clouds on the horizon, you should save as much and pay just the minimum on debt. If the current economic conditions are storm clouds, then I don’t know what is. I also agree that one should never pass up the opportunity to get your employer’s matching money in a 401(k).

]]> By: Julie http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/comment-page-1/#comment-4613 Julie Tue, 16 Dec 2008 12:50:35 +0000 http://www.livingalmostlarge.com/?p=2556#comment-4613 I think you are right to question but I also think Ramsey is right on most of this stuff. I saw a comment from fitwallet saying their highest interest rate is their house. In general, when finance gurus talk about paying off high interest rates first, they are referring to unsecure debt...credit cards, etc. I do not agree with Ramsey's snowball method completely. I think you have it right that people should pay their highest interest rate cards down first. My thoughts? Screw the warm fuzzy feeling of paying off a card just because it is a small amount. I think people should look at all their credit card debt as a whole, then work on the high interest cards first working their way down. Isn't it a warmer feeling to pay less in the end? Also, when Ramsey refers to a $1000 baby fund...he is saying that to people who do not have any emergency fund and claim they cannot afford an emergency fund. I agree with you that people should work up more savings. And not worry about college savings unless they have maxed out all their retirement accounts first. Kids can get loans for their college education, but you definitely can't for a retirement. Agreed! I think you are right to question but I also think Ramsey is right on most of this stuff. I saw a comment from fitwallet saying their highest interest rate is their house. In general, when finance gurus talk about paying off high interest rates first, they are referring to unsecure debt…credit cards, etc. I do not agree with Ramsey’s snowball method completely. I think you have it right that people should pay their highest interest rate cards down first. My thoughts? Screw the warm fuzzy feeling of paying off a card just because it is a small amount. I think people should look at all their credit card debt as a whole, then work on the high interest cards first working their way down. Isn’t it a warmer feeling to pay less in the end?
Also, when Ramsey refers to a $1000 baby fund…he is saying that to people who do not have any emergency fund and claim they cannot afford an emergency fund. I agree with you that people should work up more savings. And not worry about college savings unless they have maxed out all their retirement accounts first.
Kids can get loans for their college education, but you definitely can’t for a retirement. Agreed!

]]> By: Angie http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/comment-page-1/#comment-4605 Angie Mon, 15 Dec 2008 22:04:04 +0000 http://www.livingalmostlarge.com/?p=2556#comment-4605 I think that people who are online reading financial blogs are probably not the people who need Dave the most. I've read Total Money Makeover and listened to his podcasts, and I think that he has a plan that is simple (not always easy, but certainly simple). If you are in debt up to your eyeballs and don't see a way out, his plan is a great one to follow. It will allow you to make necessary changes without having to think too hard. If, however, you are able to sit down and look at your finances objectively, willing to take the time and energy to do research on different theories of wealth building and debt freedom, and have the fortitude to follow through, then, yes, his plan should definitely be modified to fit your personal economic situation better than his "one size fits all" method. I think that people who are online reading financial blogs are probably not the people who need Dave the most.

I’ve read Total Money Makeover and listened to his podcasts, and I think that he has a plan that is simple (not always easy, but certainly simple). If you are in debt up to your eyeballs and don’t see a way out, his plan is a great one to follow. It will allow you to make necessary changes without having to think too hard. If, however, you are able to sit down and look at your finances objectively, willing to take the time and energy to do research on different theories of wealth building and debt freedom, and have the fortitude to follow through, then, yes, his plan should definitely be modified to fit your personal economic situation better than his “one size fits all” method.

]]> By: Fabulously Broke http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/comment-page-1/#comment-4612 Fabulously Broke Mon, 15 Dec 2008 21:29:05 +0000 http://www.livingalmostlarge.com/?p=2556#comment-4612 For me, it was always to take advantage of company match (full match), then to save up 2 months of emergency money (bare minimum for example with rent and food) And then to put everything towards debt but to cut back.. REALLY BACK on all categories. For me, it was always to take advantage of company match (full match), then to save up 2 months of emergency money (bare minimum for example with rent and food)

And then to put everything towards debt but to cut back.. REALLY BACK on all categories.

]]> By: debtdieter http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/comment-page-1/#comment-4611 debtdieter Mon, 15 Dec 2008 20:44:13 +0000 http://www.livingalmostlarge.com/?p=2556#comment-4611 I think there's room for a modified version of his plan, but I agree, following it slavishly may not be the smartest thing in the current environment, or a person specific situation. You could however fix your minimum debts repayments (not reducing them as you pay off more of the debt) and save for the 3-6 month expense cushion (which would also include the minimum debt repayments in the total goal) so you'd be both saving AND eventually paying more than the minimums on your debts. I think there’s room for a modified version of his plan, but I agree, following it slavishly may not be the smartest thing in the current environment, or a person specific situation.

You could however fix your minimum debts repayments (not reducing them as you pay off more of the debt) and save for the 3-6 month expense cushion (which would also include the minimum debt repayments in the total goal) so you’d be both saving AND eventually paying more than the minimums on your debts.

]]> By: fitwallet http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/comment-page-1/#comment-4610 fitwallet Mon, 15 Dec 2008 18:49:27 +0000 http://www.livingalmostlarge.com/?p=2556#comment-4610 I'm with you on this one. Also, in these bizarre economic times, Dave's plan may not make sense for someone whose highest debt IS their mortgage! We have a second mortgage on our house (an 80/10/10 loan) and the interest rate on the smaller portion of the purchase price is 8%. That's higher than either of our credit cards (3.99 and 4.99%) or our student loans (2.875 and 3.5%). My plan is to pay off the credit cards, then build up savings, then tackle the second mortgage. At those low interest rates, the student loans can wait. I’m with you on this one. Also, in these bizarre economic times, Dave’s plan may not make sense for someone whose highest debt IS their mortgage! We have a second mortgage on our house (an 80/10/10 loan) and the interest rate on the smaller portion of the purchase price is 8%. That’s higher than either of our credit cards (3.99 and 4.99%) or our student loans (2.875 and 3.5%). My plan is to pay off the credit cards, then build up savings, then tackle the second mortgage. At those low interest rates, the student loans can wait.

]]> By: FruWiki Meg http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/comment-page-1/#comment-4606 FruWiki Meg Mon, 15 Dec 2008 17:07:22 +0000 http://www.livingalmostlarge.com/?p=2556#comment-4606 While his plan has never made mathematic sense, I give Ramsey kudos for helping some people get out of debt who may not have otherwise. However, I think he would be doing people a favor to revise his plan a bit for the time being, at least. My husband and I are in debt and we know that at whatever intensity it is going to take a while for us to climb out our hole -- though we are definitely going in the right direction and picking up speed. However, for now we've lowered our debt payments to just over the minimums and we're using the money we would have put towards debt to increase the size of our emergency fund. That way, if my husband loses his job, we will be able to pay our bills while he job hunts. If my husband's company does better than we expect, we'll start paying down debt more but still keep a few months emergency fund. Fortunately, our interest rates are reasonable because we've been paying down our highest interest rate debt first, unlike what Ramsey recommends. While his plan has never made mathematic sense, I give Ramsey kudos for helping some people get out of debt who may not have otherwise. However, I think he would be doing people a favor to revise his plan a bit for the time being, at least.

My husband and I are in debt and we know that at whatever intensity it is going to take a while for us to climb out our hole — though we are definitely going in the right direction and picking up speed. However, for now we’ve lowered our debt payments to just over the minimums and we’re using the money we would have put towards debt to increase the size of our emergency fund. That way, if my husband loses his job, we will be able to pay our bills while he job hunts.

If my husband’s company does better than we expect, we’ll start paying down debt more but still keep a few months emergency fund. Fortunately, our interest rates are reasonable because we’ve been paying down our highest interest rate debt first, unlike what Ramsey recommends.

]]> By: Grace http://www.livingalmostlarge.com/2008/12/15/is-it-time-to-kick-dave-ramsey-to-the-curb/comment-page-1/#comment-4609 Grace Mon, 15 Dec 2008 16:35:36 +0000 http://www.livingalmostlarge.com/?p=2556#comment-4609 Nah! Dave's still a good guy, he's mostly right, and his plan can be tweaked--just don't call him up and ask for permission. The Baby Step Emergency Fund is NOT meant to cover non-employment--it's for the brakes that went out on the car, the washing machine that won't spin, the window that broke in the bathroom, etc. Du to my age and lack of retirement funds, I don't follow his plan exactly--it is too important that I put money into my 401(k). His snowball plan works not just due to the psychological effects of paying off smaller debts, but that method frees up more money faster to put against other debts. Right now I'm grappling with this one because my smallest debt is a very low-interest parent loan for one of my kid's college--I'd like to be rid of the payment, but I'm wondering if I shouldn't just move to the next highest debt which has a much larger interest rate. Dave will never know and I'll remain one of his fans. Nah! Dave’s still a good guy, he’s mostly right, and his plan can be tweaked–just don’t call him up and ask for permission. The Baby Step Emergency Fund is NOT meant to cover non-employment–it’s for the brakes that went out on the car, the washing machine that won’t spin, the window that broke in the bathroom, etc.

Du to my age and lack of retirement funds, I don’t follow his plan exactly–it is too important that I put money into my 401(k).

His snowball plan works not just due to the psychological effects of paying off smaller debts, but that method frees up more money faster to put against other debts. Right now I’m grappling with this one because my smallest debt is a very low-interest parent loan for one of my kid’s college–I’d like to be rid of the payment, but I’m wondering if I shouldn’t just move to the next highest debt which has a much larger interest rate. Dave will never know and I’ll remain one of his fans.

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