Dave Ramsey and investing advice?
Love to hear how people think of Dave Ramsey. I grew up in a household where we were stressed about debt and money a long time. Dave was the first person I found that helped me start to learn about finance. I’ve put a bunch of money in high growth mutual funds when I was first learning but have since switched into managing it myself in s and p / nasdaq qqq.
1) Do you think Dave Ramsey is actually helpful? I found him very helpful at first when I was ignorant, now I think his advice is very bad for people who want to be ultra wealthy ($10-$20M +)
2) What advice do you think is bad of his?
3) How have you seen very high net worth individuals manage their money differently?
Big fan of Dave's advice. I agree his advice probably isn't useful for anyone aiming for 10M+, but that's also not who he's targeting. His target audience are regular people with no personal finance knowledge making modest salaries. His method is pretty foolproof to become a millionaire by 60
I like Dave Ramsey, but after listening to many of his videos and such, I understand that his target audience is poor and lower-middle class people. People who find him on google because they are in dire financial situations and searched online for help.
One thing that Dave Ramsey constantly says is to pay off your debt - especially credit cards. I assume that most of the readers on WSO don't have credit card debt, and pay their monthly card balances in full so that they avoid racking up 18% APY interest. But poor people do that all the time. They have over $1,000 in unpaid credit card bills that repeatedly accumulate interest every month because it's never paid off. I met people in university who were like that. I know of people who take out auto loans so that they can purchase brand new Ford F-150 pickup trucks, even though the purchase is a terrible financial decision because their income is too low. Dave Ramsey grew up in Tennessee and lives there. Imagine the types of people who live in small towns in Tennessee - that's his audience.
Most people on WSO don't need Dave Ramsey. A lot of people on WSO will be earning salaries of $100k+ at age 23. I think his most applicable advice here is to those who have debt from student loans.
I don't entirely agree on Dave Ramsey's advice of never buying a new car (vs. a used car). Sure, the value of a new car decreases by 50% within 3 years, but if you have no intention of selling the car for 10-15 years, does it matter?
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