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Old 01-16-2018, 02:01 PM   #141
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I don't understand what having a mortgage has to do with this?

If you barely got out what you put in - that would be equally true if you paid cash or mortgaged it, right? Having a mortgage doesn't change the value of the house.

Perhaps you meant you are "very glad we didn't buy more house than we actually did"?
Yes- the latter. I remember the late 1970s/early 1980s when the conventional wisdom was "buy the most expensive house you can afford". I'm really glad we didn't do that.
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Old 01-16-2018, 03:13 PM   #142
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Credit cards - 2% rebates, fabulous trips, and budgeting help! Do poor people know about these? Apparently everyone can live the high life with a credit card. What could possibly go wrong.
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Old 01-16-2018, 04:59 PM   #143
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Credit cards - 2% rebates, fabulous trips, and budgeting help! Do poor people know about these? Apparently everyone can live the high life with a credit card. What could possibly go wrong.
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Interesting viewpoint on credit cards
Old 01-16-2018, 06:51 PM   #144
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Interesting viewpoint on credit cards

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Originally Posted by purplesky View Post
Dave Ramsey attacks CNN money, CNBC, Millennial bloggers, Harvard studies,Motley fool, etc, all the time on his show.

Dave Ramsey has some very radical ideas about personal finance and Dave Ramsey gives bad investment advice that many people in the financial advisor space question often.

In the past several years Dave Ramsey has decided to be completely divisive every chance he gets. Dave made the choice.

The whole Dave Ramsey experience is church based and he is a evangelical christian.
So the religious community started to question the size of Dave Ramseys mega mansion in Nashville and question his vast wealth as a christian and what he is doing with it. Its funny. (GOOGLE DAVE RAMSEYS HOUSE)

So Dave Ramsey gets into a war of words with the christian community and gets super defensive about his wealth and being a christian.

I have been listening to Dave Ramsey on and off for about 13 years so I know his routine.

Yes overall Financial Peace University has helped many people in churches all around the country to get out of debt.

But Dave Ramsey has no business pretending he is a financial advisor.


First of all. I agree with the concept that most people would spend less using cash than a credit card. It is common sense. The easier and more convienent the purchase, the more you’ll spend.

Secondly, the Dave Ramsey rant is just that. When he rants - he calls it that. This is not his typical response to a caller. In my opinion he exhibits more patience than most people. This was an email question. He did not seem to mean. Just disagrees with the emailer.

purplesky - you certaintly have a right to your opinion. It appears that you feel Dave Ramsey is a very bad person.

In general, I suspect many people who frequent this site are good financial managers. In fact, many of the concepts and techniques that I have been exposed to here are very advanced. Mr. Ramsey is speaking to the general public - not those here. I do not say this out of arrogance. I am only attempting to illustrate the fact that on average, people with less financial training and less financial means are not using the tool of money to build wealth. Many people need simple rules to break the cycle. We all know people who do not use credit or credit cards well. For many people, they are better off paying with cash.

Respectfully,
Swanee
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Old 01-16-2018, 07:33 PM   #145
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I suppose it is like alcohol. Some people can enjoy a glass of wine with dinner and it improves their life and probably their health. Other people, if they have a drop of alcohol, have a strong likelihood of going on a long bender with serious risk to their health, relationships, job, etc. It makes perfect sense that the later group should swear off the stuff, and will be helped by a total abstinence message. Maybe some of these people would tell >everyone< to abstain from alcohol, because it can have ill effects. But such admonitions can be ignored by a large part of the population without any problem.

Abstaining from credit card use (as recommended by Ramsey) would leave me poorer, would reduce the quality of my life, and offers zero benefits. So, I disregard that advice. And, since I find other parts of his advice also inappropriate, and because I don't find him to be entertaining, I no longer listen to him. But, some people need his approach, or like to listen to him, or just want to wear the hairshirt. Okay for them. But he's not giving advice with universal applicability (something he doesn't feel a need to say) . And to the degree folks just follow his rules without gaining a deeper understanding of things, they lose a chance to improve their lot.
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Old 01-16-2018, 08:54 PM   #146
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First of all. I agree with the concept that most people would spend less using cash than a credit card. It is common sense. The easier and more convienent the purchase, the more you’ll spend.

Secondly, the Dave Ramsey rant is just that. When he rants - he calls it that. This is not his typical response to a caller. In my opinion he exhibits more patience than most people. This was an email question. He did not seem to mean. Just disagrees with the emailer.

purplesky - you certaintly have a right to your opinion. It appears that you feel Dave Ramsey is a very bad person.

In general, I suspect many people who frequent this site are good financial managers. In fact, many of the concepts and techniques that I have been exposed to here are very advanced. Mr. Ramsey is speaking to the general public - not those here. I do not say this out of arrogance. I am only attempting to illustrate the fact that on average, people with less financial training and less financial means are not using the tool of money to build wealth. Many people need simple rules to break the cycle. We all know people who do not use credit or credit cards well. For many people, they are better off paying with cash.

Respectfully,
Swanee
No I do not think Dave Ramsey is a bad person at all.
Dave Ramsey has a family charitable foundation that I am sure helps many people.
He promotes giving all the time which is a great thing.

Most of the people that do the debt free screams make very good incomes and many are college educated.
Most seem to get exposure to Dave Ramsey at their church where they take the Financial Peace university class.

Many people just buy 2 expensive cars and a boat and go to Disney world on a credit card and next thing you know you are calling the Dave Ramsey show.

Maybe Dave Ramsey should design a Financial Peace 2 course that would be more suitable for 2018.
The millennial generation just isn't going to use cash.

This whole Dave Ramsey ignore your credit score thing is a bad idea.

My DS is only 23 and he now has 2 credit cards and has a good credit score with established credit of his own.
The funny thing is my son grew up listening to Dave Ramsey and we would always say "Better than I deserve" and "live like no one else so you can later live like no one else".

But I had to make a choice as a parent and not follow Dave Ramseys advice because I wanted my son to establish credit as soon as possible.
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Might as well use CC
Old 01-17-2018, 10:49 AM   #147
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Might as well use CC

I'm a DR fan. I enjoy his patience with people and hearing about Millionaires and their stories. Simply entertainment. Somewhat helpful at the end of the day. But as many of you we use CC's.

It occurs to me that the stores need to build the CC fee into their pricing. We pay for those fees whether we're using cash or CC. So, might as well us the CC for the rewards to get something for what you're going to pay anyway.

BTW - if you spend a lot (helps if still traveling for business) and like to travel domestically / Caribbean and live in a SWA town. There is no better card than the Chase Visa SW card. Companion pass get's our "rewards" up to the 12% level.
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Old 01-17-2018, 11:03 AM   #148
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I suppose it is like alcohol. Some people can enjoy a glass of wine with dinner and it improves their life and probably their health. Other people, if they have a drop of alcohol, have a strong likelihood of going on a long bender with serious risk to their health, relationships, job, etc.
That's probably a good analogy. My father and a cousin were/are alcoholics and could only live a normal life by complete abstinence so I'm familiar with the issue.

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My DS is only 23 and he now has 2 credit cards and has a good credit score with established credit of his own.
Good for him! I got my first credit card at age 22 and the urging of my older sister simply to establish a credit rating (as it was called then). I'd pull it out of a drawer and use it two or three times a year and pay off the bill when it came in. That did come in useful later on.

One of the issues I had with credit cards is that my parents had run up a huge cc bill at Montgomery Ward when I was about 13 and it took three years of concentrated effort for them to pay it off. And when you're 13, three years is FOREVER, or at least it seemed so. That made an impression on all three of us kids and we learned the lesson well. None of us has ever had a problem with being too deep in debt.

Proof that an example doesn't have to be a good one to teach a kid something worth knowing.
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Old 01-17-2018, 01:34 PM   #149
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Good for him! I got my first credit card at age 22 and the urging of my older sister simply to establish a credit rating (as it was called then). I'd pull it out of a drawer and use it two or three times a year and pay off the bill when it came in. That did come in useful later on.
I also got my first CC when I was 22, 6 months out of college. I didn't use it very often, but it did come in handy when I went out of town on vacation (back in my bigger traveling days). I used it to buy airplane tickets and didn't have to worry about carrying enough cash if I wanted to buy stuff when out of town.
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Old 01-17-2018, 01:36 PM   #150
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That's probably a good analogy. My father and a cousin were/are alcoholics and could only live a normal life by complete abstinence so I'm familiar with the issue.



Good for him! I got my first credit card at age 22 and the urging of my older sister simply to establish a credit rating (as it was called then). I'd pull it out of a drawer and use it two or three times a year and pay off the bill when it came in. That did come in useful later on.

One of the issues I had with credit cards is that my parents had run up a huge cc bill at Montgomery Ward when I was about 13 and it took three years of concentrated effort for them to pay it off. And when you're 13, three years is FOREVER, or at least it seemed so. That made an impression on all three of us kids and we learned the lesson well. None of us has ever had a problem with being too deep in debt.

Proof that an example doesn't have to be a good one to teach a kid something worth knowing.
My older sister cosigned for me on a car loan. It was a Nissan Sentra with no conditioning and I think it’ stickered for about $5000.
It’s funny I think the payment was like $80 a month.

That was a huge favor for her to do that For me to help establish credit And to get a reliable set of wheels!

I remember my mom had Issues with her JCPenney’s credit card.

Yes money issues and personal finance Can have a huge effect on families.
It seems the older I get the more I realize that some of my parents money struggles have kind of stayed with me.
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Old 01-17-2018, 01:42 PM   #151
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Back on topic, I do not know how your credit score can go to zero? I have not had any assets,debts or credit in the USA for the past 15 years and maintain a credit score in the 760-790 range. Every few years when it drops below 770 or so I make it a point (when I am in the USA) to buy a few $100 worth of junk at Kohl's & Ross. They always offer me a credit card and a 10-20% discount on that initial purchase. I then pay off the credit card at the same cashier and walk out. there is an immediate bump to my credit score that lasts a few years. Eventually, Kohl's & Ross cancels the card for lack of use, rinse and repeat.
Your credit score goes to zero when you close all credit accounts and do not open any new ones and do not use credit of any kind for a period of time, I think 10 years?
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Old 01-17-2018, 01:45 PM   #152
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I'm a DR fan. I enjoy his patience with people and hearing about Millionaires and their stories. Simply entertainment. Somewhat helpful at the end of the day. But as many of you we use CC's.

It occurs to me that the stores need to build the CC fee into their pricing. We pay for those fees whether we're using cash or CC. So, might as well us the CC for the rewards to get something for what you're going to pay anyway.

BTW - if you spend a lot (helps if still traveling for business) and like to travel domestically / Caribbean and live in a SWA town. There is no better card than the Chase Visa SW card. Companion pass get's our "rewards" up to the 12% level.
The Southwest Airlines card? I had that card I guess about six or seven years ago and since I didn’t fly enough I ended up canceling it because of the annual fee.

I just recently flew on Southwest and I almost signed up for it again to get a $200 credit.

According to Clark Howard that’s considered one of the best airline cards.
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Old 01-17-2018, 03:16 PM   #153
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Your credit score goes to zero when you close all credit accounts and do not open any new ones and do not use credit of any kind for a period of time, I think 10 years?
If you had really bad credit, foreclosures, judgements, etc before you closed those accounts, it would still only get you down to 300-400. After about 7-10 years and those things came off your record, your score would move up some.

Before I moved to Peru, I had in the 800's. never looked at it until about 7 years ago when I noticed I was in the 760's with no open CC's and I think a 7 year history. That concerned me as I will be moving to the USA with my family and will have no income other than SS and will need to have a good score to rent an apartment for a few years.
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Old 01-17-2018, 03:26 PM   #154
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A little personal anecdote: for DW's 60th birthday one of the gifts I gave her was $600 in cash, to spend however she wanted. She had never had that much in cash at one time for herself.
How does one get to that age, especially when being part of an 'early' retirement, and not have had $600 in discretionary cash to spend at some point
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Old 01-17-2018, 03:49 PM   #155
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How does one get to that age, especially when being part of an 'early' retirement, and not have had $600 in discretionary cash to spend at some point
A "tight leash"!

Actually, I transferred all my assets to my Wife years ago. Up until SS started rolling in 2 years ago, she would give me $1,000/mth for spending money. She has since cut me off as I can't risk my bank account going over 10K or I have to file an FBAR.
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Old 01-18-2018, 10:42 AM   #156
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If you had really bad credit, foreclosures, judgements, etc before you closed those accounts, it would still only get you down to 300-400. After about 7-10 years and those things came off your record, your score would move up some.

Before I moved to Peru, I had in the 800's. never looked at it until about 7 years ago when I noticed I was in the 760's with no open CC's and I think a 7 year history. That concerned me as I will be moving to the USA with my family and will have no income other than SS and will need to have a good score to rent an apartment for a few years.
You should sign up for Credit Karma. Its free and millions of people use it without issue. They will email you if anything changes with your credit.

They update your credit score and credit snapshot weekly. You will be able to see all your open and closed accounts and see your score weekly.

Credit Karma is a great tool. Unfortunately Dave Ramsey doesn't want you to use it because he preaches the FICO score is a scam. It is not.

Try renting an apartment without a credit score. No thanks.

A credit score of 300 is basically zero. You are screwed at that point credit wise.
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Old 01-18-2018, 11:04 AM   #157
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I must have been 24 when I got my first CC. It was a Master Charge which I got through a local bank where my salary was being direct-deposited; that meant I wasn't charged an annual fee.

They would not give me a card until I had been with my employer a full year and had a salary of at least $15K. At the one-year point, I got my first step increase to slightly over $15K and off to the bank I went! Such a relief not to have to write checks to buy clothes, to be able to buy an airline ticket, etc. Plus, I wanted to establish credit in my own name; against the dim distant day when I would apply for a mortgage.

I knew enough not to carry a balance or pay a late fee. These seemed very basic, obvious matters, even to unsophisticated me.

For many years, when paying in a department store line, I noticed a significant gender difference: All the men used credit cards, while the women (except me) paid by check. (I hated the line at the discount cosmetics store - all women - all check writers!) Suspect it's not that different today, except that the women use debit cards instead of checks now.
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Old 01-18-2018, 11:27 AM   #158
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A "tight leash"!

Actually, I transferred all my assets to my Wife years ago. Up until SS started rolling in 2 years ago, she would give me $1,000/mth for spending money. She has since cut me off as I can't risk my bank account going over 10K or I have to file an FBAR.
Wow... you REALLY want to stay under the radar.

Good thing your wife hasn't run off with the pool boy.
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Old 01-18-2018, 11:50 AM   #159
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Wow... you REALLY want to stay under the radar.

Good thing your wife hasn't run off with the pool boy.
No pool for me. I live in the Penthouse on the 16th floor overlooking the Pacific Ocean. I have room for a pool on my 700sq/ft terrace, but with the weekly tremors, the water would be sloshing around my bedroom and destroying my Brazilian cherry floors!

As has been noted here many times a "great spouse" is integral to any good plan.
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Old 01-18-2018, 10:43 PM   #160
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DR has helped a lot of people and his program is great for getting people out of debt. For the most part people who have to be told what to do, who have been superconsumers their entire adult life. For some he helps, many, it becomes a religion and Dave has engineered his program to make devoted followers. The perfect DR follower is one that has been living beyond their means for as long as they can remember, are drowning in debt. They have trouble seeing a way out. Others have told them how to get out, but it doesn't resonate. They are offered financial peace at a low price or even free. The course is usually facilitated by those who are already on board and some who have successfully completed at least a few of the baby steps. These people are often his acolytes and they fiercely defend all things Dave. Baby steps sounds easy. Follow everything exactly, in order no deviating. If you go to a DR forum or just talk to acolyte it is very weird. They don't drive cheap beaters. They drive Dave cars. They don't get second jobs. They get Dave jobs. Dave says pay off your credit cards. Don't transfer your balance, that isn't Dave approved. Dave says build an emergency fund. Dave says save up to buy things. Apparently no one thought of these things before Dave (that part is really odd because he says a lot that his ideas are nothing new) What, you want to put money in a traditional IRA, no that is the devil, Dave says only do Roth IRAs. How much do you save for retirement, 15%. Until you have paid for your kids college and pay off your mortgage. Then you can do more. Oh, I have a financial question, does anyone know what Dave says about.... Dave says CDs are bad don't buy CDs. Ever. Don't buy bonds, all of your retirement has to be invested in stock and it has to be allocated his way. Oh, still confused about investing? Looking for an advisor? Dave happens to have Dave approved advisors, who pay a small fee to be in his network.
In all fairness most of the people who listen to him and have taken his classes aren't like that and he has helped many more people than I have. But people that can't think for themselves drives me nuts in case you were wondering.
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