My Thoughts on Dave Ramsey

Rich over at Richer and Better (an excellent blogger, btw, you should definitely check out his thought-provoking site) asked what my take on Dave Ramsey was, so here are my thoughts:

1. I believe the man knows exactly what works good for him, and he sticks to it, and recommends that others do the same.  So, while I may disagree with him on a subject, I still have the utmost respect for him.  He, obviously, has been more than successful at employing his methods, and so I value his opinion highly.
2. I agree that intensity is more important that mathematically figuring out the most effective way of paying down debt.  I really feel that it is 80% attitude and 20% math.  I do, however, have a few differences from his plan that I employ:
   1. I have not sold my vehicles to drive beaters.  I am pretty “car-heavy” right now, given his thoughts on how much car you should own, but I have decided to own more expensive, reliable, and newer cars simply because of my extreme bad luck in cases where I’ve driven beaters.  The beaters end up costing me as much or more than a new vehicle, and I spend less time worrying/fixing the newer vehicles.  I still adhere to the philosophy that the “cheapest car I can drive is the one I’m in now”, for the most part.  Hopefully, I’ll pay off the vehicles faster than their life, and have enough time to purchase my next vehicle outright.
   2. I have a credit score, according to Credit Karma, of 821, and that’s up 4 points from last month.  Although I know that Dave refers to this as an “I love debt score”, I’m really not willing or ready to sacrifice that yet.  Prudent use of credit cards, if it is possible, will end up saving me more money than not having a credit score will.  (My wife’s cell phone is what jumps to mind first)  Now, if you are the type that is prone to abuse credit cards, I recommend staying away from them.  I take the same stance on alcohol.  I don’t feel there’s anything inherently evil about alcohol, but if you are prone to being an alcoholic, its probably best to stay away from it…
3. Beyond his debt-reduction strategy, I don’t know too much, because I’ve not gotten to that point personally.  However, I do have some sub-thoughts that I’m willing to explore a bit further…
1. He is a big fan of term life vs. whole life/cash value insurance.  I haven’t investigated this fully, since I intend on getting life insurance after we either a) pay off all credit card debt, or b) the first kiddo comes along (whichever is first).
2. I’m not sure about his investing ideas, although he seems to do well by them.  I know less than I really should about stocks, mutual funds, etc., but, then, I’m not out of debt yet, so I don’t really need to be spending my time thinking about investing.  Right now, my best investment is the elimination of my debt.
4. “If you live like no one else today, tomorrow, you will be able to live like no one else.”  It makes sense.  If I am willing to limit my spending today, and, rather, invest that money, it seems to be reasonable to assume that later I will have more to spend than the ones who didn’t live on less than they made.

Bottom line, I respect Dave where he’s gotten in life, and I value his opinion for where I am in life.  Do I disagree with him in some areas?  Sure.  But there are very few people that I agree with on everything, even within a given subject.

As to his ELPs, (Endorsed Local Providers) I’ve never used their services, and don’t know if I will in the future or not.  I don’t know that I’ll buy insurance from Zander Insurance, or subscribe to MealTimeMakeover.com, or buy into whatever his next endorsement is, but, at the same time, I don’t fault him for endorsing products/services, and promoting people who follow his line.

I hope that answers your question, Rich…  If not, just let me know what you’d like answered more specifically and I’ll get to it…  (This was just too long of a reply to leave it in the comments section… :-)