Will that be Cash or Credit?

[Quantum Sufficit]

for those that carry a mortgage in retirement, Dave Ramsey likes to ask people if they had a paid off mortgage, would you go out and borrow to invest or place your money where ever it is you now have it?

[brewer12345]

I'd like to ask Dave Ramsey when he stopped beating his wife.

[Quantum Sufficit]

really...was he a beater?

[RetireAge50]

Yes I would and have before borrowed to invest. Borrowed from HELOC to max out Roth and 401k and paid it off from higher incomes later. Also borrowed for real estate investments. Worked out well for me.


Sent from my iPhone using Early Retirement Forum

[daylatedollarshort]

Quote:

Originally Posted by Quantum Sufficit for those that carry a mortgage in retirement, Dave Ramsey likes to ask people if they had a paid off mortgage, would you go out and borrow to invest or place your money where ever it is you now have it?

I'd ask Dave Ramsey to explain where he received his math training. If someone offered to lend Dave $100M at zero percent interest, would he take it and invest it Treasury bonds or turn it down because he didn't want to be a naughty, naughty debtor?

Or if he needed to borrow $1 at 2% interest in order to keep his AGI below the 400% FPV cliff limit for $10K in ACA tax credits, would it be better to keep from being in debt $1 even if it meant a net financial loss of $9,999.98?

[Walt34]

Quote:

Originally Posted by daylatedollarshort I'd ask Dave Ramsey to explain where he received his math training. If someone offered to lend Dave $100M at zero percent interest, would he take it and invest it or turn it down because he didn't want to be a naughty, naughty debtor?

I think one has to bear in mind that Ramsey's (and Suzie Orman's) target audience are not the people on this forum. So for that reason I'll cut both some slack.

Like the others here we don't pay cc interest and haven't for decades. We use a mixture of cash, checks, and credit cards but the credit cards are of course paid off in full every month.

[imoldernu]

This may be off topic, but a comment on interest, and rates. Not posted as an endorsement of the article, but one person's observations on the future.
Interest Rates Cannot Rise and Here’s Why… | First Rebuttal

Quote:

So you start to understand that interest rates are locked into a very low range forever or at least until total debt gets paid down, which none of us expect to ever happen. So with total debt greater than GDP and rising it’s SOL for future retirees and all other savers. Next stop will be negative interest rates which of course will need to be monetized. In chess they have a term called Zugzwang; a situation in which no matter what move you make you will be worse off than you are currently. I believe we may be in a Zugzwang now.

Zugzwang= new word for me

[daylatedollarshort]

As a side note, here is Dave Ramsey's house:

Dave Ramsey’s House: Living Like No One Else

[aja8888]

Quote:

Originally Posted by daylatedollarshort As a side note, here is Dave Ramsey's house: Dave Ramsey’s House: Living Like No One Else

But it's paid for....(no mortgage)

[daylatedollarshort]

Quote:

Originally Posted by aja8888 But it's paid for....(no mortgage)

It was paid for by his followers, presumably not wealthy people in debt, with all those products and endorsements one finds on his web site.

[aja8888]

Quote:

Originally Posted by daylatedollarshort It was paid for by his followers, presumably not wealthy people in debt, with all those products and endorsements on his web site.

Isn't that his job?

[daylatedollarshort]

Quote:

Originally Posted by aja8888 Isn't that his job?

To extract money from poor people?

[aja8888]

Quote:

Originally Posted by daylatedollarshort To extract money from poor people?

No, he owns his own business and may even be incorporated. He spends time giving free advice on the radio and maybe on TV. He writes books, gives seminars and probably does a lot of real work behind the public's view. I don't believe he is doing anything fraudulent in public.

I think I would call that a job or business, not a lot different than any other person who provides a service.

[daylatedollarshort]

Quote:

Originally Posted by aja8888 No, he owns his own business and may even be incorporated. He spends time giving free advice on the radio and maybe on TV. He writes books, gives seminars and probably does a lot of real work behind the public's view. I don't believe he is doing anything fraudulent in public. I think I would call that a job or business, not a lot different than any other person who provides a service.

I didn't say he was doing anything fraudulent. But I find his lifestyle rather interesting compared to the frugal advice on his site, which is loaded up with endorsements and products targeted at poor people.

[Quantum Sufficit]

Pass the popcorn please!

[aja8888]

Quote:

Originally Posted by daylatedollarshort I didn't say he was doing anything fraudulent. But I find his lifestyle rather interesting compared to the frugal advice on his site, which is loaded up with endorsements and products targeted at poor people.

Putting his personal lifestyle aside, as that's his and his wife's business, I don't believe his business is purely targeted at "poor" people like you say. And poor is a relative term.

His audience appears to be geared towards helping people who are hopelessly (or carelessly) in debt and that could include a lot of not-so-poor people. I bought several of his books years ago for family members who "didn't have a clue" and that information was timely and appreciated.

Now, I agree that he gives some bad advice on investments and their returns, and that may be viewed upon as unrealistic and probably not aligned with his typical message.

I don't believe he is filming a future show for CNBC's Scam Artist documentaries.

[aja8888]

Quote:

Originally Posted by Quantum Sufficit Pass the popcorn please!

Here you go..

popcorn.GIF

[meierlde]

Quote:

Originally Posted by imoldernu This may be off topic, but a comment on interest, and rates. Not posted as an endorsement of the article, but one person's observations on the future. Interest Rates Cannot Rise and Here’s Why… | First Rebuttal Zugzwang= new word for me

Re negative interest rates: Until they put expiration dates on $100 bills (or 500 euro notes), you can always take the cash and put in an safe deposit box all be it that might cost $50/year. Anyway you can fit quite a few $100 bills in a safe deposit box.

[daylatedollarshort]

I think there are a lot of good blogs and forums out there that have much better critiques and dissection than I could ever do of Dave Ramsey's math and endorsements, like White Coat Investor, John Graeney, Bogleheads and Wade Pfau:

Wade Pfau's Retirement Researcher Blog: Dave Ramsey's 8% Withdrawal Rate

http://www.bogleheads.org/forum/viewtopic.php?t=49864

http://retireearlyhomepage.com/daveramsey.html

So with that I will bow out spewing any more of my own cynical observations and leave that subject to the experts.

[freebird5825]

No mortgage (paid off in 1999), no debt except monthly credit card (cashback 4-3-2-1% on different types purchases), no outstanding loans.

I have every bill except water and property/school taxes paid through my credit card. I pay the credit card off twice a month to coincide with my survivor pension and immediate fixed annuity income deposits. All done online.

I use cash only when I have to.

My income has increased recently due to applying for and receiving my deferred FERS pension. I doubt my spending habits will change. I live simply and cheaply and see no reason to change that habit.

If it ain't broken...