First, I'd like to say congratulations to the OP and other posters here who have paid off their debts!
I'm divided in my opinion of Dave Ramsey. I have a mostly positive opinion. He helps a lot of people who call into his show, and it's fun to listen to the "debt free screams". His baby steps, whether or not one entirely agrees with all of them, make for a clear plan, and it's oriented to help people who have been struggling with debt (which is many millions of people in the US). I have recommended his books and 9-week class to family & friends who have been struggling with debt, and at least one of the people to whom I recommended the class went through it and it transformed their finances.
But I'm not a Dave Ramsey purist. E.g., I have a cash-back credit card that I still use. I pay off the full balance every month so I never pay interest, but DR says one shouldn't have a CC at all even if one pays it off every month.
But the biggest area where I diverge from DR is mortgage debt. The rest of this post is my house loan story, which is more complicated than any of the others posting to this thread because I own rental houses.
DR says one should only buy a rental house with cash, never with a loan, because of "risk". But I wouldn't have anywhere near the net worth that I do without having bought rentals with loans. Buying a rental with a loan aka leverage is an opportunity to increase net worth over time by a lot of money. I started buying rentals before I heard DR's advice, but once I did, he didn't change my opinion. Yes, there is an element of risk, but there is risk in all of life. One needs a reserve for unexpected vacancies & repairs and a good cash flow, but if one has these things, a rental is a great way to increase net worth over time.
I bought my first rental in 2003, then acquired a couple more over the next few years. Then in 2008-9 when the real estate crisis hit, I said to myself, "This is the time to buy rental houses!" I was able to buy seven rentals for about half the price of what they would have cost a year earlier. I even took out equity lines on two houses I already owned, in order to finance the rental house purchases (which is also completely against the DR plan). When I was done buying in mid-2009, I had pretty much exhausted the cash and credit I could get. I ended up with my primary home and ten rentals. Of these, nine houses had loans and the other two were clear.
Since then, depending on the situation, some of these loans I tried to pay off ASAP, others I'm just paying off over the full 30-year term via tenant rents. I am trying to have less mortgage debt as I get older. On the other hand, I'm not doing the DR way of trying to pay off all mortgage loans super-early.
Two years ago (mid-2018), at age 55, I quit my day job and I'm now retired except for doing tenant management of my own houses. (I don't do my own maintenance repairs, but I do manage the tenants.)
I've paid off three houses since 2009. At present, my primary home and four rentals are paid off. The other six rentals still have mortgages.
Of the six rentals with loans, three will be paid off the year I turn 67 (nine years from now), which is also the year I can claim full Social Security. I currently clear about $55k/yr positive cash flow on my rentals, but when I get Social Security and have the 3 mortgage payoffs in the same year, that will give me another $52k/yr which will put me in really great shape for cash-flow. (BTW, I'm also using about $25-30k/yr which is about a 2% Withdrawal Rate on my money-type assets. When I reach age 67, I probably won't need to continue to withdraw any of that money due to the extra SS & rental cash flow. Although, "you can't take it with you", so I'll figure out some way to spend that money!)
But those last three rental house loans, two of the loans will pay off when I'm age 80, the other at age 84 (assuming I live that long!). These houses are my most expensive ones, and they get good rental cash flow but the loans are also the largest. From a cash flow perspective, it doesn't make sense to me to try to pay them off early. So for now, I'm just letting them run to their full loan term and the tenant rents are gradually paying them off. Maybe when I turn 67 and get all that extra cash flow coming in, I'll change my mind and decide to start paying down these mortgages faster. Or maybe when I get into my 70s, I won't want to manage rental houses anymore and I'll start selling off some of these houses. We'll see. But for now, I'm not going to do anything to pay off these mortgages early.
Between my house mortgages and the fact that I still like to use a cash-back credit card, I won't be doing a "debt-free scream" any time soon. But for those who do, like I said, they are really fun to listen to on DR's show!
