I hate Dave Ramsey such damn scam, its called common sense, you don’t need anything special.
Wife and I, pretty much debt free just a house and some medical debt other than that we live within our means. We are just trying to control our food budget which is out of hand.
We’ve been debt free since the 90’s except for a very small mortgage we had till we retired in 2005, and sold that house and moved to our vacation house. Wife was 53 and I was 56 when we retired, and don’t have big union pensions, mater of fact have very little pension income due to how early we retired. Boats, vehicles, and such as vacation house, we always paid cash. New vehicles every 2 to 3 years. The only loan I have had in the last 20 years or so was a very short term house one, when we purchased our last house. We hadn’t started trying to sell the one we lived in yet, so needed a 6 month loan. I don’t subscribe to the theory that there is good interest, or that deductions are good, and feel that no interest is always best if possible. If you want to invest, you already are 3% ahead of someone that has borrowed so that they can have spare money to invest. Everyone has their opinions, and this is what has worked for us. One thing I will say, being without debt is such a great feeling knowing you can always cut back some if needed.
I’m almost the opposite. Toys are all paid off but it almost pains me to have all that equity in assets that are depreciating. I understand parts of the David Ramsey program (although I can’t stand the guy) and I think it helps/works for certain a types of people. If “debt” is emotionally overwhelming I get it (my wife is one of them). If you’re not living beyond your means however, it is not the best way to get richer quicker.
We are just trying to control our food budget which is out of hand.
Bar/restaurant had some honey siracha butter chicken wings chef special month ago, how do you not stop there for lunch at least a couple times?!
My wife got us on parts of the Ramsey plan and SO glad we did. It took a bit of getting used to. We do a Cash budget every two weeks (she takes care of most of it). We have a series of envelopes that we keep secure in our house for major expenditures (Gas, Groceries, Restaurants, Entertainment, Auto, etc). Had to get in the habit of grabbing the right envelope when we walked out the door, but it’s almost second nature now. We also give ourselves a “cash allowance” every two weeks for carrying-around money. $50/two weeks and because most things are buy are actually budgeted for anyway, I find I rarely spend it so I stash that away, too and usually dig it out when it’s time for a new fishing pole, etc.
We still carry debt for our Mortgage and one of our vehicles but are ahead on both. We still keep a credit card for emergencies, occasional online purchases, reserving hotel rooms, etc. But we put some $$ in savings to cover most of that and the debt is usually paid off when the next bill comes. As someone said before, not all debt is bad – if you stay on-top of it it only helps your credit rating. But I wouldn’t do it any other way. It feels great to have more financial control and certainty.
<div class=”d4p-bbt-quote-title”>Charles wrote:</div>
We are just trying to control our food budget which is out of hand.Bar/restaurant had some honey siracha butter chicken wings chef special month ago, how do you not stop there for lunch at least a couple times?!
Sounds good, point taken lol.
The BEST thing we ever did was go to a financial advisor, we get $$$$ taken out of our checkbook every month for multiple investments. That money adds up real fast.
The bad part is that the people that really need to listen to Dave, just don’t. The plan will work, and it is for people that spend more than they need. It has worked for years for my family. I love being able to “invest” in things that have a heavenly return instead of an earthly return. Wish we could get our government to think more in terms of NOT over spending also, but that is a whole new subject.
Dave Ramsey is a good start for financial literacy 101, but really not great advice for anyone with a decent understanding of $ or finances. Another good book is Beyond Paycheck to Paycheck by Michael Rubin. The FIRE (Financial Independence, Retire Early) movement is growing in popularity too, and Mr Money Moustache a good resource for those of you interested. Basically aggressively become debt free, lower your cost of living, build residual incomes, and you are free to do what you want for life. This doesn’t mean retiring and doing nothing, but enabling you to do what you’d like that still produces some level of income.
We still have a lot of debt, imo, but it is all at 3% or less, and being paid down aggressively. I was lucky to have parents that taught me how money, credit and finances worked early on. Paid for my first year and a half at state schools out of pocket, then transferred to a MIAC school w/ no scholarships and took on a ridiculous amount of debt despite playing two sports and working during off seasons, that, again thanks to my parents basically making me take on a $700/mo principal and interest payment, I paid off in under the 10 years I was scheduled for. My wife also went to a different MIAC school with 0 help from the school or her parents, and paid interest only so we’ve been paying a small mortgage towards that. Add in 2 kids in daycare which is basically another big mortgage payment, and let’s just say in about 5 years we will be rolling in it 
Sunday I was on Pool 4 pulling cranks by the can line.
There were a lot of 21 foot walleye boats with 350 – 400 hp motors pre fishing for a tournament.
How can so many people afford a $80,00 – $100,000 boat? Plus the big truck to tow it? I’m guessing on the price. The last new boat I bought was a 2004 17 ft Skeeter tiller.
I now fish out of a mid 90’s aluminum bench boat with a 25hp motor. I got tired of bouncing around big water.
Mrs KFK and I only have a mortgage. The plan is to have it paid off before retirement. Having no short term debt does make a guys life less stressful.
The Ramsey thing isn’t a end all for everybody but some can benefit from it. I never learned how to handle money either at home or in school. Maybe it wasn’t taught or maybe I wasn’t listening (likely the case).
Once you have been loaded with debt through credit cards, vehicles, toys, home(s),kids there really isn’t a better feeling than the day the last one gets paid off. It takes 60-90 days to really feel what debt free is like. Having the ability to go in debt doesn’t mean a person should or needs to do it.
I know people who retired very early & I know people who will never be able to fully retire. It’s our choice.
I’m a cash money kind of guy. Everything but my house is paid. I don’t have a clue who this Ramsey fella is. I dont have any financial planners. I grew up poor and told my self I wouldn’t do that to my kids. So I live within my means. Have a older boat. Newer truck newer suv and new house. Have a couple credit cards but don’t use them much. I will buy gas or groceries on them and then pay them off every other week.
The bad part is that the people that really need to listen to Dave, just don’t. The plan will work, and it is for people that spend more than they need. It has worked for years for my family. I love being able to “invest” in things that have a heavenly return instead of an earthly return. Wish we could get our government to think more in terms of NOT over spending also, but that is a whole new subject.
Word.
Sunday I was on Pool 4 pulling cranks by the can line.
There were a lot of 21 foot walleye boats with 350 – 400 hp motors pre fishing for a tournament.
How can so many people afford a $80,00 – $100,000 boat? Plus the big truck to tow it? I’m guessing on the price. The last new boat I bought was a 2004 17 ft Skeeter tiller.
I now fish out of a mid 90’s aluminum bench boat with a 25hp motor. I got tired of bouncing around big water.
Mrs KFK and I only have a mortgage. The plan is to have it paid off before retirement. Having no short term debt does make a guys life less stressful.
20 year loans on both. Finance your life away.
How can so many people afford a $80,00 – $100,000 boat? Plus the big truck to tow it?
I never could quite figure that out either. I go to the Boat Show almost every year and the price tags are enough to give a guy a stroke.
They must have a lot better jobs than I do, or no kids. Get rid of your kids and the money flows like water lol
I’m 34 and my only debt is my mortgage. Being debt free is the only way to go.
The Ramsey program is good if you lack some core financial skills that many people did not get taught growing up. My background is in finance and accounting, so the Ramsey program was more or less common sense based on my education background.
One other huge thing to cutting down on expenses and increasing savings is paying for everything with a credit card and paying the credit card off every paycheck/2 weeks. The credit card is essentially treated as a debit card, the major difference being is that you get on average anywhere from 1-5% cash back/rewards from using a credit card versus spending cash or a debit card. It is FREE MONEY and I am always surprised by how many people don’t take advantage of it. Literally every expense I have besides my mortgage goes on the credit card, meaning I get anywhere from a 1-5% discount on any expense I have, sometimes more depending on the card. Some people don’t have the self control to not run up a balance, which I understand, and that means the credit card rewards “game” is not for you. If you pay any interest on credit cards, the rewards are not worth it – it’s only meant for people that don’t use the credit like it’s money they don’t have.
<div class=”d4p-bbt-quote-title”>koldfront kraig wrote:</div>
Sunday I was on Pool 4 pulling cranks by the can line.There were a lot of 21 foot walleye boats with 350 – 400 hp motors pre fishing for a tournament.
How can so many people afford a $80,00 – $100,000 boat? Plus the big truck to tow it? I’m guessing on the price. The last new boat I bought was a 2004 17 ft Skeeter tiller.
I now fish out of a mid 90’s aluminum bench boat with a 25hp motor. I got tired of bouncing around big water.
Mrs KFK and I only have a mortgage. The plan is to have it paid off before retirement. Having no short term debt does make a guys life less stressful.
20 year loans on both. Finance your life away.
Not always the case. Some guys have built very successful businesses and thats where they spend their money. Some buy a boat & truck instead of paying off 3 wives. Some wives buy their husband a boat. Some guys work 2 or 3 jobs to support their hobby. Some guys have a boat instead of a second home.
Yes a long term loan is a option but not every boat you see is financed. 
This is a topic I’m pretty passionate about as I get to see the full range of finances. The most compelling was the “savers” couple, she worked fast food and he was a janitor, and they had nearly $1M in the bank and a paid off home at retirement age. While on the flip side the “spenders” couple in their late 40’s made about $2M a year and didn’t have $10k to put down on the $1M boat they bought, and were paying a 23% interest note on it. All this stuff boils down to living within your means, or not.
Im 34 and debt free other than my mortgage, and a small outstanding balance on that blasted SnapOn truck. The wife and I are currently working on a plan to get the house paid off so we can be totally debt free. I was very fortunate to get a place that was a foreclosure and repair it for very cheap. We owe $50,000 on a house and 6 acres that appraised at 150k back in 2014.
I’d like to learn more about investing and start exploring those options to help us get our house paid off.
I’m almost the opposite. Toys are all paid off but it almost pains me to have all that equity in assets that are depreciating.
Having equity in a depreciating asset is much better than paying interest on a depreciating asset.
this discussion is the same every time, and usually without nuance.
mortgage is an asset.
kid’s college is saved for and fully funded 10 years early.
revolving credit is paid off before ever incurring interest.
retirement is firmly on track for age 55.
so somehow my truck and boat loans are bad? no, they are affordable payments that allow me to have a luxury item right now without having any impact on our long-term goals. consider that not everyone’s life is the same as yours, so your shoes might not fit their feet.
there are much better questions than “are you debt free?”:
“do you have long-term plan?”
“are you on track to reach your goals?”
Wife and I are working on paying off a Tahoe, a Silverado, and Boat. Boat is nearly done, the two trucks are halfway. The truck will stay with me until it absolutely needs replacing. The Tahoe will probably get traded in with cash on a newer Tahoe in 2-3 years as it sees very few miles and is in excellent condition.
We will be happy having only a mortgage after the boat and trucks are done.
We owe on our house and a car that will be paid off in January 2022. That’s it. Chose a new career path at 59 and can live off my retirement if needed.
Paid for both my kid’s college degrees. Lived a pretty spartan lifestyle the last 8 years but worth it. I hired so many “kids who had 80,000- 140,000 in debt they can NEVER pay off at $45-$55 grand a year and did not want my kids starting out like that. Our choice but I think long term for us AND them and better choice.
Spending? We contemplate “need” vs “want” – simple as that
<div class=”d4p-bbt-quote-title”>Smellson wrote:</div>
I’m almost the opposite. Toys are all paid off but it almost pains me to have all that equity in assets that are depreciating.Having equity in a depreciating asset is much better than paying interest on a depreciating asset.
Unless the interest I’m paying (2%) is significantly less than what a relatively conservative investment can produce. My boat being paid off saves me 2% in interest a yr. S&p 500 index fund averages 10+% return/yr. That’s 8% I’m losing in all the equity I have in toys…Kinda nice not making payments every month, but the math in my head knows I’m losing money.
We’ve been debt free since the 90’s except for a very small mortgage we had till we retired in 2005, and sold that house and moved to our vacation house. Wife was 53 and I was 56 when we retired, and don’t have big union pensions, mater of fact have very little pension income due to how early we retired. Boats, vehicles, and such as vacation house, we always paid cash. New vehicles every 2 to 3 years. The only loan I have had in the last 20 years or so was a very short term house one, when we purchased our last house. We hadn’t started trying to sell the one we lived in yet, so needed a 6 month loan. I don’t subscribe to the theory that there is good interest, or that deductions are good, and feel that no interest is always best if possible. If you want to invest, you already are 3% ahead of someone that has borrowed so that they can have spare money to invest. Everyone has their opinions, and this is what has worked for us. One thing I will say, being without debt is such a great feeling knowing you can always cut back some if needed.
X1000
This is the best thing said in this post!
Unless the interest I’m paying (2%) is significantly less than what a relatively conservative investment can produce. My boat being paid off saves me 2% in interest a yr. S&p 500 index fund averages 10+% return/yr. That’s 8% I’m losing in all the equity I have in toys…Kinda nice not making payments every month, but the math in my head knows I’m losing money.
Yes you bring up a good point. The big problem with financing a depreciating asset is you can end up in a pinch where you owe more than the asset is worth, which is never a good situation to be in (i.e. 2008 housing crisis). While that doesn’t happen as much with boats (since they hold their value so well), it is much more common with vehicles and other toys. Many American’s live in debt up to their eyeballs and it is much more common than you’d think for someone like that to have negative equity in a toy.
<div class=”d4p-bbt-quote-title”>Smellson wrote:</div>
Unless the interest I’m paying (2%) is significantly less than what a relatively conservative investment can produce. My boat being paid off saves me 2% in interest a yr. S&p 500 index fund averages 10+% return/yr. That’s 8% I’m losing in all the equity I have in toys…Kinda nice not making payments every month, but the math in my head knows I’m losing money.Yes you bring up a good point. The big problem with financing a depreciating asset is you can end up in a pinch where you owe more than the asset is worth, which is never a good situation to be in (i.e. 2008 housing crisis). While that doesn’t happen as much with boats (since they hold their value so well), it is much more common with vehicles and other toys. Many American’s live in debt up to their eyeballs and it is much more common than you’d think for someone like that to have negative equity in a toy.
Completely agree. I think someone who has racked up debt to their eyeballs would benefit greatly by following Dave Ramsey. It has always just bugged me that Ramsey refuses to admit that his method is not best for everyone. In some cases debt (loans) vs paying cash will net someone more in the long run if they can afford to pay cash in the first place. They do however have to actually do something (invest) with that money for it to make sense.
To all those worried about how someone can afford a 80 to 100,000 boat, and think they must be foolishly taking 20 year loans, think again and next time you are talking to a boat salesman you trust, ask him. There is some big loans on the bass boats as buyers are younger, but alot of those 100 grand walleye boats are paid cash. Buyers lived their lives responsibility and are enjoying the fruits of that. They also had kids to raise, but lived within their means during that period, and it doesn’t mean they didn’t do anything to do it, they just watched more closely what they spended than others. Every penny you pay to a bank, is a penny of spending power you chose to throw away, it’s that simple.
I am 50 and the lovely Mrs Grouse is 46. Of course, when we were younger, we had some student loan debt and had to buy a car or two, but we paid everything off except the mortgage when we were still in our twenties.
Now we’ve been debt-free and mortgage-free for I don’t even remember how long. Never heard of Dave Ramsey, we just both have the same mindset that overall debt is bad and to be avoided whenever possible.
So the question that will be asked–oh wait, someone asked it already…
What exactly is the goal with paying off all debt and making it to “financial freedom”?
The payoff for us was that once we were debt-free, we were also free to basically do whatever we wanted (within reason, obviously) AND the biggest one for me is freedom FROM WORRY about finances.
This last part cannot be over-stated as a benefit. Financial worry is a, if not THE, number one cause of stress, serious health problems, and worst of all, serious relationship problems. The bottom line is financial stress kills people and it kills marriages.
To give a real example of the freedom, my company changed hands a few years ago as a minority partner bought out the founder. The new owner and his wife were total tools and knew how to do everybody’s job better. So I told them to have fun doing mine because after 20 years I wasn’t going to take that sh!t. Peace out. Making the car/boat/etc payment never entered into the decision.
Since we have no debt, we basically have the freedom to do what we want. Decisions don’t come down to “how are we going to finance this or pay for that”, they come down to do we really want something and how does it fit with our goals and values.
Everybody’s answer will be different , but after working with our Church’s program for helping couples with finances, I can say nobody regrets getting control of debt.
This is a topic I’m pretty passionate about as I get to see the full range of finances. The most compelling was the “savers” couple, she worked fast food and he was a janitor, and they had nearly $1M in the bank and a paid off home at retirement age. While on the flip side the “spenders” couple in their late 40’s made about $2M a year and didn’t have $10k to put down on the $1M boat they bought, and were paying a 23% interest note on it. All this stuff boils down to living within your means, or not.
I’m not sure a million dollars is enough for decent retirement now days.
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