Do you think this is affordable?-Dave Ramsey response

[Luvdogs]

Haven't seen anything about him here for awhile. Ready for the controversy!

Recently someone called in and said they have $2 million in savings and her husband wanted to buy a $150K motor home/RV or something like that.

Our savings are similar plus a pension and later SS but I would be scared to death to buy something that expensive (that wasn't a house).

We have 10 year old SUV, 3 year old fun car and a 32 yr old jeep (original owner!)

He said sure, you can afford it, enjoy.

That's 7.5% of their savings.

Am I being too conservative or is he crazy? (like his 12% ROI)

Of course he makes a big deal about people being "millionaires." My thought is that they are forty-thousandaires not millionaires.

Any opinions?

 

[Pilot2013]

Are they 30? Maybe not...

Are they 60? Buy, travel and enjoy!

 

[Scrapr]

the thing about expensive RV's is they can be worth zero in a heartbeat or moment of distraction. Maybe insurance pays a bit but you aren't getting $150k back

no thanks

 

[FANOFJESUS]

Are they 30? Maybe not...

Are they 60? Buy, travel and enjoy!

I am guessing Dave thinks like this. I would not do it myself but I understand his thinking.

 

[Pilot2013]

I am guessing Dave thinks like this. I would not do it myself but I understand his thinking.

I wouldn't either, but then if I had $5 million I wouldn't do it. Just don't care about RV's that much. You obviously don't either, but some people do. Like the Sports Car post.

 

[Blue Collar Guy]

I used to watch Dave Ramsey when he was on a Long Island TV channel, pre cable days . My wife banned me from watching him because I got so worked up when he would give an answer that I liked. I d be hootin and hollering "thats right, thats right, this guys right." He was a big LBYM guy. Hearing callers crying they went bankrupt on their credit cards , but took nice first class trips while Im in a basement apt used to send me into a lather. Is he crazy? I dont think so.

 

[bw5972]

Haven't seen anything about him here for awhile. Ready for the controversy!

Recently someone called in and said they have $2 million in savings and her husband wanted to buy a $150K motor home/RV or something like that.

Our savings are similar plus a pension and later SS but I would be scared to death to buy something that expensive (that wasn't a house).

We have 10 year old SUV, 3 year old fun car and a 32 yr old jeep (original owner!)

He said sure, you can afford it, enjoy.

That's 7.5% of their savings.

Am I being too conservative or is he crazy? (like his 12% ROI)

Of course he makes a big deal about people being "millionaires." My thought is that they are forty-thousandaires not millionaires.

Any opinions?

I think I remember that call and thinking go ahead. There's no prize for being the richest guy in the cemetery.

 

[NW-Bound]

$150K RV on a $2M savings?

It is only bad if the guy finds out that RV'ing is not for him, and sells it at a big loss.

 

[bw5972]

Found the original call (was replayed on air recently).

https://youtu.be/xSZF0AqBsfY

Couple was aged ~60 - 70 (actual not mentioned but he closed a business after 35 years).

Also, she will be working several more years at $120,000 per.

 

[FANOFJESUS]

I wouldn't either, but then if I had $5 million I wouldn't do it. Just don't care about RV's that much. You obviously don't either, but some people do. Like the Sports Car post.

Now I might take some of the 2 million and buy a v6 Camry but that is a far cry from a 150k RV.

 

[2017ish]

Found the original call (was replayed on air recently).

https://youtu.be/xSZF0AqBsfY

Couple was aged ~60 - 70 (actual not mentioned but he closed a business after 35 years).

Also, she will be working several more years at $120,000 per.

Then, go for it. (Assuming other spending wasn't outrageous.)

Obviously, many variables.

 

[Ready]

What someone can "afford" and whether we would spend the money on the same thing are two unrelated issues. I would never spend that kind of money on an RV, but if it is a lifelong dream of theirs and they saved their entire life to get to this point I don't see any harm in it.

 

[Bamaman]

No matter how you look at it, RV's and boats are luxury items. And a beginner RV'er doesn't need to start off spending $150K, as he would do better in a $75K unit to first see if the lifestyle meets his needs.

Like anything, you have to completely make a commitment to use such an asset. And that requires you to be away from home a lot.

We have the boats and a RV, but not nearly that expensive. We do love sitting in the Northeast Georgia mountains anytime of the year.

 

[38Chevy454]

I think I remember that call and thinking go ahead. There's no prize for being the richest guy in the cemetery.

Quite true. Since the caller is in 60's age range, and has spouse still working bringing in good paycheck, absolutely no reason not to do it if they will use it and enjoy the time RVing.

He could be wanting to spend a lot more on an RV, I think $150K is very much acceptable given his finances and position in life.

As I tell many people, retiring early to have more time and better health, even with a bit less money is a great tradeoff. Plus I have no intention of leaving a big amount of money for the "38Chevy454 Memorial Library"

 

[Investornew]

I took a Dave Ramsey course and do not agree with some of the things he promotes.

 

[NgineER]

Haven't seen anything about him here for awhile. Ready for the controversy!



Recently someone called in and said they have $2 million in savings and her husband wanted to buy a $150K motor home/RV or something like that.



Our savings are similar plus a pension and later SS but I would be scared to death to buy something that expensive (that wasn't a house).



We have 10 year old SUV, 3 year old fun car and a 32 yr old jeep (original owner!)



He said sure, you can afford it, enjoy.



That's 7.5% of their savings.



Am I being too conservative or is he crazy? (like his 12% ROI)



Of course he makes a big deal about people being "millionaires." My thought is that they are forty-thousandaires not millionaires.



Any opinions?

It depends on their expenses. If they are spending $40k, sure, if they spend $100k, probably not.

 

[Blue Collar Guy]

I just heard the call, I agree, they should buy it, they are seniors one id 66 years old, they are closer to the cemetery then they are to the starting line.

 

[Lakewood90712]

Of course they should buy the mid cost RV. IIRC, Berkshire Hathaway owns an RV manufacturer , and at least 50% chance it came from that co. ( disclosure, BRKB share owner here ).

RV's drop in resale value like a rock. Depreciation is irreverent. It's not an investment.

Haven't herd Ramsey on the radio in the so cal area in a long time.

 

[UnrealizedPotential]

I wouldn't do it , even if I had 2 million, but they earned it so if that's what they want to do, do it. I remember in the 80's when I was kid, they had motor homes for 500k and 600k . Sometimes even more. They were super high end. I believe if memory serves, this was at the Anaheim convention center. Must have been a lot of "I'm just looking" customers.

 

[Scuba]

Found the original call (was replayed on air recently).

https://youtu.be/xSZF0AqBsfY

Couple was aged ~60 - 70 (actual not mentioned but he closed a business after 35 years).

Also, she will be working several more years at $120,000 per.

In that case, I'd agree - go for it!!

 

[brucethebroker]

Funny isn't it? Most likely no negative thoughts if they wanted to buy (reasonable mortgage) and could afford a $750k new home. "OK if they have the cash flow", "Let 'em enjoy it at their age.". I guess it is because many of us think of the home in a whole different perspective. BUT, the value of the home vs. depreciated value of RV at their deaths does not affect THEM either way, only the heirs.

My guess is that an around the world vacation each year, or a series of expensive trips abroad over the next decade would also be OK. It's all money spent-what does it matter?

 

[Maenad]

It depends on their expenses. If they are spending $40k, sure, if they spend $100k, probably not.

That's where I come down as well. Also, I've heard a lot of bad things about the crappy construction in RVs, so I think spending $150k on one is a rip-off.

However, as a counter-argument, DH and I need about 1.75 mil to be FI. After that, we're planning on saving an additional 250k for a multi-month European vacation, new vehicles, a solar roof, and a couple of "eventual" things like re-siding our house and replacing our driveway. If they're doing something similar with money above and beyond what they need I say it's their money to spend however they want.

I could listen to the call to see if those kind of details are included, but it's a lot more fun to just spout off my opinion.

 

[bclover]

Funny isn't it? Most likely no negative thoughts if they wanted to buy (reasonable mortgage) and could afford a $750k new home. "OK if they have the cash flow", "Let 'em enjoy it at their age.". I guess it is because many of us think of the home in a whole different perspective. BUT, the value of the home vs. depreciated value of RV at their deaths does not affect THEM either way, only the heirs.

My guess is that an around the world vacation each year, or a series of expensive trips abroad over the next decade would also be OK. It's all money spent-what does it matter?

lol, which is what I was thinking when I post about some spending we deem as "good" while others are "bad".

No I have no desire to go RVing so whether it's affordable is moot but I did drop some thousands on a time share at Disney and we all know ole Dave feels about that.

 

[foxfirev5]

The only problem I see is with the DW continuing to work will they have time to use it enough to justify the cost?

 

[HarveyS]

I heard the call and thought the answer would be "NO". Boy, was I surprised at Dave's answer. Thinking about it, I took away that I need to loosen my purse strings and spend more. If they buy a late-model, used RV they should be able to use it for as long as they like and sell it again for half (or more) of what they paid for it. Sure, it's going to cost something...but living your dream usually does!