Posted: June 10th, 2010 | Author: Joe | Filed under: Debt | Tags: dave ramsey, Debt, debt collector, Fair Debt Collection Practices Act | 1 Comment »
I’m still sort of up in the air about Dave Ramsey on a lot of things. Sometimes I think he makes a lot of sense, and other times I think he’s just phoning it in, or giving advice about something he’s not really that knowledgeable in. Investing falls into that second category. I think he gives OK advice for people who aren’t really looking to be investors and only want to do something to invest for retirement. But I think his advice on debt is usually spot in.
I came across his article on debt collectors on Facebook today and thought it was worth sharing on this blog.
He starts off with some pretty unimpressive and frankly “Duh!” sounding stuff in the beginning:
Debt collectors are after one thing—your money.
And, you know what? That’s okay. If you borrowed money, then you need to pay it back. Collectors have the right to call you and ask you to pay back the money you owe.
It’s true, and I suppose it needs saying for some people out there, but I honestly never thought a debt collector cared about me. Not once. Never.
But having said that, there’s a big difference between wanting me to pay a debt that I’m obligated to pay, and using every method short of something Tony Soprano might use to shake me down for every spare cent I have. And this is where Dave provides some real info.
Toward the end of the post, he shares the basics about the Federal Fair Debt Collection Practices Act, and also provides some more resources to help deal with debt collectors and debt in general.
Head on over and check it out, it’s short. 
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Posted: September 23rd, 2009 | Author: Joe | Filed under: Debt | Tags: celebrity bankruptcy, dave ramsey, Debt, Income, money, Opinion | No Comments »
I don’t know if you are a Dave Ramsey fan or not, but I’ve been listening to him casually on the radio during my evening commute now for a few months and I had to write about something I noticed time and again on his shows. It seems like just about every person who gets on the air with Dave to ask for advice about a debt problem always answers with something in the 6-figure range when Dave asks what their salary is!
I swear that 85-90% of those callers say they make somewhere between $100,000-200,000 a year.
The first question I had for a while was, “How in the world can you have a problem with debt when you make 6 figures a year?!”
Then the answer gradually became clear to me – these people don’t have a problem with debt, they have a problem with spending! It’s a money management problem, made worse (magnified) by a large salary.
Think about it- we see it all the time with celebrities. They have multi-million (sometimes billion) dollar incomes and somehow lose it all. How does that happen?
The answer lies with the fact that money is a lubricant that greases your financial skids. But if you can’t steer the sled, you’re apt to fly off a cliff and the more money you have (lubricant) the faster (and farther) you’ll fly off that cliff.
The Dave Ramsey callers, like Ed McMahon, M.C. Hammer, Michael Jackson, and hundreds of other celebrities should serve as a reminder that more money alone will not solve your problems. In fact, it may make them worse! You should first get your financial house in order, then grow your income. Chances are, you’ll actually keep more of it that way. 
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Posted: June 7th, 2009 | Author: Joe | Filed under: Credit | Tags: Add new tag, Credit Cards, dave ramsey | No Comments »
I’ve been listening to Dave Ramsey’s radio show on my way home form work the past couple of weeks, and I must say I really enjoy it. But he does keep saying something that kind of bothers me a little:
“Credit cards are the cigarettes of the financial world.”
It sounds good, and certainly gets the point across, but is it really true?
I mean, strictly speaking, cigarettes kill the user over time. There are no healthy benefits to smoking cigarettes.
Contrast this with credit cards and the comparison falls apart. Credit cards don’t necessarily kill (financially speaking) the user. Credit cards, unlike cigarettes, can be used in moderation without negative effects. In fact, rewards cards can be beneficial.
I think misuse of credit cards is the cigarette of personal finance.
You can certainly ruin your financial health misusing credit cards, and people do become addicted to them, but they are not always bad for everyone all the time.
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Posted: September 18th, 2008 | Author: Joe | Filed under: Debt, Retirement | Tags: dave ramsey, Debt, Retirement | 3 Comments »
“You’re saying that you’re all washed up
Got nothing else to give
Seems like you never figured out
How long you have to live”
- The Traveling Wilburys
I’ve shied away from Dave Ramsey. I’ve seen some blogs talking about him, and seen his multitude of books in passing in book stores, but I’ve so far avoided him. I think it must be because he is everywhere I turn.
It’s my contrarian personality I suppose.
But I can ignore him no longer. I saw him on T.V. the other day, talking about the mortgage/credit crisis and what you should do about it. He made a lot of sense. I’m not saying I’m going to become a convert, but I am listening.
I stumbled onto an article at Yahoo! Finance the other day by Dave Ramsey, titled: Dave Ramsey on Debt in Retirement.
This article caught my eye because I hear quite a few of my parent’s friends talk about how they’ve never been more in debt than they are now. These are people who have just retired, or nearing retirement. It certainly makes me want to do everything in my power to avoid being in that situation when I reach that point in my life.
If you’re a couple of generations removed from the boomer generation, you might be wondering what the big deal is. I’ve even heard some boomer’s say, “who cares about debt? They can’t make me pay when I’m dead.”
This line of reasoning always makes me think of the quote at the top of this post. People often have so much anxiety about dying young, that they never plan for the far more likely scenario: a long life.
But here’s what Ramsey has to say about why debt in retirement is a big deal:
“It’s imperative that debt be eliminated as soon as possible, for that then gives you control of your most powerful wealth-building tool: your income. It is very difficult to service debt when you’re in retirement, and most people who have debt going into retirement are not people who have big savings going into retirement. So it creates a really catastrophic situation.”
He goes on to say:
“I recently talked with a 72-year-old lady who owes $80,000 on her house and she’s trying to live on a monthly Social Security check of 1,100 bucks … and what that says is that she’s not going to be able to keep that house, not if she wants to live and eat.
This idea that a mortgage is forever is a bad plan; this idea that debt is forever is a really bad plan. Debt will only steal your golden years away from you.”
Hey, this guy makes a lot of sense!
When he talks about boomers and debt, it really drove home the “Debt as Megatrend” concept detailed in Stock Investing For Dummies, by Paul Mladjenovic.
“The fastest growing area of bankruptcy filers are senior citizens — and college-agers are right behind them. So, as the boomers, who were notorious for overspending and under-saving, start hitting retirement, I wish I could be happier as to what I’m going to see. But the statistics aren’t good, and past financial sins have a nasty way of catching up with you.”
I would encourage everyone to read this article. If you’re a boomer – it’s never too late to get moving in the right direction, and if you’re just out of college or highschool – take heed and avoid the debt trap!
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