Any honest financial advice will begin with an analysis of risk. Some have an appetite for it and others do not: neither is objectively correct, but market risk has a long track record of paying off. Ramsey makes no such analysis. He starts with the universal premise that debt is bad with no acknowledgment that it can lead to great returns. That alone I consider unforgivable, but he then flips the equation and advocates for a 100% equities portfolio once you are out of debt with no real reckoning (that I've ever heard) for why risk should be unequivocally avoided when you are in debt and then enthusiastically embraced when you are not.

Then, he points you to his advisers (who give Ramsey his cut) and managed funds, all of which siphon off valuable chunks of your money.

At the end of the day he probably helps people whose finances are a mess, but only because the path they are on is already so damaging. For responsible adults he unquestionably is a drag on their wealth.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Lawyer with law student loans.

I have a much higher net worth than I would with DR despite my loans because I:

1) ignored DR and took out $$$$ loans for a T10 law school which landed me biglaw despite median grades

2) ignored DR and bought a house despite still having tons of student debt

3) ignored DR and maxed out retirement saving $$$$$ on taxes given my double biglaw marriage

Honestly the market would have to get destroyed for me to not be better off having taken advantage of the tax savings given my tax rate.

Just curious. What would happen to you now if you lost your job and didn't get one for 6 months? Do you have the savings to pay for your mortgage and student loans during that time? How about your childcare?

How would someone following DR, with a paid-off house but little savings or investments, fare in these circumstances?

DR followers have emergency savings for this purpose.

What do you do in a recession when you lose your job AND the market is down. Do you really want to sell stock at a loss to pay your mortgage?

You know it's possible to have an emergency fund and invest, instead of have an emergency fund and then pay off your mortgage. In fact that's precisely the advice for having an emergency fund: so you don't have to realize losses.

Anonymous wrote:

Anonymous wrote:
Someone doing Dave Ramsey would have a six-month emergency fund prior to attempting to pay off the house.

Dave Ramsey is a program for people who are not good at managing their personal finances. Little, if anything, about it is optimal from a numbers perspective.

But, it is a program that spendthrifts seem to be able to keep up with, and seems to have helped a lot of them go from having lots of consumer debt to being debt-free.

Personally, I have never done Dave Ramsey. I don't need to. I have chosen to pay off my mortgage because I really enjoy the freedom it gives me. I have never liked being in debt, and I appreciate being off the treadmill of having to have income to pay off a huge, looming bill every month, and know I'll have to work for the next 25+ years.

Are you fairly young? Life's circumstances can also do a number on a family's finances--especially, major illnesses or other setbacks that result in huge debts and sometimes the inability to continue working because one parent or other family member has to be a caregiver.

I'm confused.

I'm the quoted post, but I don't actually disagree with anything you posted, or really see how it brings into question anything that I posted.

Anonymous wrote:

Anonymous wrote:
How would someone following DR, with a paid-off house but little savings or investments, fare in these circumstances?

Someone doing Dave Ramsey would have a six-month emergency fund prior to attempting to pay off the house.

Dave Ramsey is a program for people who are not good at managing their personal finances. Little, if anything, about it is optimal from a numbers perspective.

But, it is a program that spendthrifts seem to be able to keep up with, and seems to have helped a lot of them go from having lots of consumer debt to being debt-free.

Personally, I have never done Dave Ramsey. I don't need to. I have chosen to pay off my mortgage because I really enjoy the freedom it gives me. I have never liked being in debt, and I appreciate being off the treadmill of having to have income to pay off a huge, looming bill every month, and know I'll have to work for the next 25+ years.

Are you fairly young? Life's circumstances can also do a number on a family's finances--especially, major illnesses or other setbacks that result in huge debts and sometimes the inability to continue working because one parent or other family member has to be a caregiver.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Lawyer with law student loans.

I have a much higher net worth than I would with DR despite my loans because I:

1) ignored DR and took out $$$$ loans for a T10 law school which landed me biglaw despite median grades

2) ignored DR and bought a house despite still having tons of student debt

3) ignored DR and maxed out retirement saving $$$$$ on taxes given my double biglaw marriage

Honestly the market would have to get destroyed for me to not be better off having taken advantage of the tax savings given my tax rate.

Just curious. What would happen to you now if you lost your job and didn't get one for 6 months? Do you have the savings to pay for your mortgage and student loans during that time? How about your childcare?

How would someone following DR, with a paid-off house but little savings or investments, fare in these circumstances?

DR followers have emergency savings for this purpose.

What do you do in a recession when you lose your job AND the market is down. Do you really want to sell stock at a loss to pay your mortgage?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My physical and mental health improved when my debt was eliminated. Some people--like me--are physically and emotionally burdened by debt and the worry that comes along with in ways you cannot imagine. Paying off my debt as a top priority was the right path for me.

These are emotional decisions, not financial decisions. If it makes you feel better, go for it, but don't pretend that you are following an effective strategy for maximizing wealth.

You may view "wealth" as solely numbers in accounts. I view it wholistically, as both financial security and being physically, mentally and emotionally healthy. If I were a multi-millionaire who had suicidal thoughts and couldn't get out of bed, I wouldn't consider myself to be wealthy.

Look up there in the top left corner. It says "Money and Finances.". "Emotional Well-being " is a couple of doors down on your left.

Seriously though, this debt free thing is irrational.

Another irrational, debt-free person at age 35 here!

My only interest in "Money and Finances" is to help me craft a happy, safe life for my family. I use money to help me do that. Being debt free is part of my plan for that life.

I understand that money can be a numbers game. Watching you numbers go higher and higher, maximizing your investments, seeing a risk pay off. It's fun, shallow game. And leverage can pay off in your fun, shallow game. But I'm not interested in that game. You can play if you want. It is about as interesting as tic-tac-toe (not very, for anyone over the age of 7).

Anonymous wrote:
How would someone following DR, with a paid-off house but little savings or investments, fare in these circumstances?

Someone doing Dave Ramsey would have a six-month emergency fund prior to attempting to pay off the house.

Dave Ramsey is a program for people who are not good at managing their personal finances. Little, if anything, about it is optimal from a numbers perspective.

But, it is a program that spendthrifts seem to be able to keep up with, and seems to have helped a lot of them go from having lots of consumer debt to being debt-free.

Personally, I have never done Dave Ramsey. I don't need to. I have chosen to pay off my mortgage because I really enjoy the freedom it gives me. I have never liked being in debt, and I appreciate being off the treadmill of having to have income to pay off a huge, looming bill every month, and know I'll have to work for the next 25+ years.

My partner hates DR. We have student loan dept that is six figures and a mortgage and we pay what we owe buy my partner says we are better off investing/saving fir retirement since the loan rates are like 3 percent each. Now credit cards are terrible and certainly don't carry cc debt but once you have a chunk of change saved and invested, you can use the interested earned to pay your loans even and increase your savings from your monthly pay check.

Anonymous wrote:

Anonymous wrote:Lawyer with law student loans.

I have a much higher net worth than I would with DR despite my loans because I:

1) ignored DR and took out $$$$ loans for a T10 law school which landed me biglaw despite median grades

2) ignored DR and bought a house despite still having tons of student debt

3) ignored DR and maxed out retirement saving $$$$$ on taxes given my double biglaw marriage

Honestly the market would have to get destroyed for me to not be better off having taken advantage of the tax savings given my tax rate.

Just curious. What would happen to you now if you lost your job and didn't get one for 6 months? Do you have the savings to pay for your mortgage and student loans during that time? How about your childcare?

How would someone following DR, with a paid-off house but little savings or investments, fare in these circumstances?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My physical and mental health improved when my debt was eliminated. Some people--like me--are physically and emotionally burdened by debt and the worry that comes along with in ways you cannot imagine. Paying off my debt as a top priority was the right path for me.

These are emotional decisions, not financial decisions. If it makes you feel better, go for it, but don't pretend that you are following an effective strategy for maximizing wealth.

You may view "wealth" as solely numbers in accounts. I view it wholistically, as both financial security and being physically, mentally and emotionally healthy. If I were a multi-millionaire who had suicidal thoughts and couldn't get out of bed, I wouldn't consider myself to be wealthy.

Look up there in the top left corner. It says "Money and Finances.". "Emotional Well-being " is a couple of doors down on your left.

Seriously though, this debt free thing is irrational.

Why is it irrational? I have no mortgage and just dumped 15k last month into investments and this was after max 401k and a lovely cash only vacation to Majorca (college is paid off for the kids already). Back in 2014-2017 and into 2018 once we realized the market was becoming unstable, I'm glad our "irrational" debt free lifestyle afforded us, in those years a 7 figure account.

Not terribly irrational at all. We are 45 and living debt free has moved us much closer to no longer being wage slaves, but having our money do all the income generation.

The point is you would have more money doing "income generation"....

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
That's a myth. If you left your accounts alone and kept investing right on through the recession, you did just fine.

Sure. but you'd have done even better to have spent the time leading up to the recession paying off your debts instead of investing that money. Then, when you paid your debt off a couple of years later, you could have bought in while the market was low and been further ahead.

That sounds like market timing because it is. That's the whole point. We don't know the future, and you can't time the market. The fact that someone missed out on the last year of growth because he or she was instead paying down debt seems like a really good point right now, but it was over a small window and things could just as easily gone the other direction.

That's why you keep buying all along, instead of waiting until you pay off your mortgage ridiculously early. So you're buying over that 30 year period of your mortgage.

Meh. I've been mortgage free since I was 35 in 2008. It has served me well. I've been able to take big risks in my career that have paid off well and often invest 10s ot thousands of dollars a month

Your mortgage wasn't 10s of thousands a month, and some of us are worried of the risk of having money tied up in home equity (without a corresponding return). Others prefer diversified market risk to career risk. But the point is: waiting to invest until you are debt free is still market timing (you just timed it your debt, and in your case to starting buying in 2008).

If you've got 10's of thousands to invest a month, i'm sure it feels like something 'served you well.' Have you run the numbers on alternatives?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My physical and mental health improved when my debt was eliminated. Some people--like me--are physically and emotionally burdened by debt and the worry that comes along with in ways you cannot imagine. Paying off my debt as a top priority was the right path for me.

These are emotional decisions, not financial decisions. If it makes you feel better, go for it, but don't pretend that you are following an effective strategy for maximizing wealth.

You may view "wealth" as solely numbers in accounts. I view it wholistically, as both financial security and being physically, mentally and emotionally healthy. If I were a multi-millionaire who had suicidal thoughts and couldn't get out of bed, I wouldn't consider myself to be wealthy.

Look up there in the top left corner. It says "Money and Finances.". "Emotional Well-being " is a couple of doors down on your left.

Seriously though, this debt free thing is irrational.

What’s all the money FOR, dum-dum? A platinum coffin?

No. It’s for security, independence, health, a great future, opportunities, education, travel, home, enjoyment. If you don’t have emotions and well-being connected to those investments, great...I’ve always wanted to meet Data from Star Trek.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My physical and mental health improved when my debt was eliminated. Some people--like me--are physically and emotionally burdened by debt and the worry that comes along with in ways you cannot imagine. Paying off my debt as a top priority was the right path for me.

These are emotional decisions, not financial decisions. If it makes you feel better, go for it, but don't pretend that you are following an effective strategy for maximizing wealth.

You may view "wealth" as solely numbers in accounts. I view it wholistically, as both financial security and being physically, mentally and emotionally healthy. If I were a multi-millionaire who had suicidal thoughts and couldn't get out of bed, I wouldn't consider myself to be wealthy.

Look up there in the top left corner. It says "Money and Finances.". "Emotional Well-being " is a couple of doors down on your left.

Seriously though, this debt free thing is irrational.

Why is it irrational? I have no mortgage and just dumped 15k last month into investments and this was after max 401k and a lovely cash only vacation to Majorca (college is paid off for the kids already). Back in 2014-2017 and into 2018 once we realized the market was becoming unstable, I'm glad our "irrational" debt free lifestyle afforded us, in those years a 7 figure account.

Not terribly irrational at all. We are 45 and living debt free has moved us much closer to no longer being wage slaves, but having our money do all the income generation.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My physical and mental health improved when my debt was eliminated. Some people--like me--are physically and emotionally burdened by debt and the worry that comes along with in ways you cannot imagine. Paying off my debt as a top priority was the right path for me.

These are emotional decisions, not financial decisions. If it makes you feel better, go for it, but don't pretend that you are following an effective strategy for maximizing wealth.

You may view "wealth" as solely numbers in accounts. I view it wholistically, as both financial security and being physically, mentally and emotionally healthy. If I were a multi-millionaire who had suicidal thoughts and couldn't get out of bed, I wouldn't consider myself to be wealthy.

Look up there in the top left corner. It says "Money and Finances.". "Emotional Well-being " is a couple of doors down on your left.

Seriously though, this debt free thing is irrational.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
That's a myth. If you left your accounts alone and kept investing right on through the recession, you did just fine.

Sure. but you'd have done even better to have spent the time leading up to the recession paying off your debts instead of investing that money. Then, when you paid your debt off a couple of years later, you could have bought in while the market was low and been further ahead.

That sounds like market timing because it is. That's the whole point. We don't know the future, and you can't time the market. The fact that someone missed out on the last year of growth because he or she was instead paying down debt seems like a really good point right now, but it was over a small window and things could just as easily gone the other direction.

That's why you keep buying all along, instead of waiting until you pay off your mortgage ridiculously early. So you're buying over that 30 year period of your mortgage.

Meh. I've been mortgage free since I was 35 in 2008. It has served me well. I've been able to take big risks in my career that have paid off well and often invest 10s ot thousands of dollars a month