Why Dave Ramsey Is Wrong About Car Payments Always Being Bad

Why Dave Ramsey Is Wrong About Car Payments Always Being Bad

In today’s video I react to a Dave Ramsey video as a caller asks Dave for advice on buying a car using cash or debt. Listen as I react to Dave’s rant on debt, car payments, and best ways to buy a car.

#BetterWealth #daveramsey #carpayments

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BetterWealth

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Caleb Guilliams

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[DemetriusWalker]

Yes! With the same logic, Dave is completely contradicting himself! Thanks for sharing, Caleb!

[jwilburn]

I just need a simple reliable car that I car go to work. I followed Ramsey's advice to never take out a loan and paid cash 3-4k on a 1999 Ranger that the engine blew in 6 months because of the fault of the private seller.

[jackieferrarimusic]

Thanks for sharing your perspective. I get what you’re saying but when you save up money for something you’re not oweing someone else money and you don’t have interest if something goes wrong or if you get set back a month or two and then have people calling you nonstop cause you can’t make a payment if something goes wrong

[jlyon]

As someone that's in sales and who sold cars before, I have to disagree with you!... 1- It's a proven fact that when you borrow money, you're more likely to spend more than someone paying cash. That's why stores like Best Buy will give someone 0% financing on purchases over a certain amount. 2- There's is no such thing a good and bad debt. Debt is debt, people!! People make TERRIBLE car purchase decisions all of the time and then turn around say "iT dOesN't mAtTer bEcAusE It'S gOod dEbt"; as they can BARELY afford their car payments.

[chriseaton]

All I know is if my financial situation goes south, there won't be a repo man visiting. Thats a solid enough reason for me.

[ryand]

Show me where you can get 2% APR on a used vehicle.
I don't believe in Dave's method with CC's and credit - but I'll never have a car payment again.

[gerrim]

I think it’s hard because realistically everyone would like to buy a car outright. Not everyone can afford that. If you live in a city you don’t necessarily need car but if you live in a smaller town or suburb you do, especially to get to work or if you have kids.

[themagus]

Two years ago, I moved to a new home. I had to replace the A/C system on my old home for $4000. They are charging me no interest for 36 months on 36 payments. Inflation is at 7% per year. So they are losing 7% per year on the money they loaned me. That's the same as me making 7% on my money; even more if I invest the balance due at, say, 5%. Why would I want to pay the debt off early? Same with my new home....I could have paid cash but I financed it with 20% down at 2.75%. My house appreciates at maybe 10% per year, minus the 7% inflation rate. So, every year the inflation rate is above 2.75%, I'm making money. I'm doing the same thing on a 0% loan for a recent surgery. Any time someone will lend me money at 0% interest, baby, I'll take it. I'll keep my money in my bank account, thank you, and LEVERAGE as much as I can. That's the way capitalists do it! Dave Ramsey is a one-size-fits-all moron like Suze Orman. They make money off of TV spots selling you books and tapes. That's why they have to BUY air time on weekend TV and radio.

[bullforcetrading]

Borrowing money to pay interest on a car that drops in value like a rock as soon as you drive it off the dealer lot, and can't sell it if you need to unless you bring more money to the table in order to make up for the negative loan to value ratio, pass. I think I'll stick with Dave's sage advice.

[samuelburton]

I have a car payment and still have plenty money in the bank. I know people who don’t have a car payment and are broke.

[brianjames]

Dude having a car payment is the worst kind of debt you can have. Its Crippling. Paying 500 or even 300 for 5 to 7 years is Stupid. the Car Depreciates. Dave Ramsey is 1000 percent right. People need to stop Working hard for the bank! and work hard for themselves.

[neilr]

Debt can’t be good. That’s an oxymoron. Owing money to others is never good. Buying a used car straight up is the best way to get a car.

[cookoonamoonyoo]

im gonna side with dave ramsey. sorry dude.

[joelrosales]

Most people live on debt and are broke. I get your point, but most people don’t have the will power to live beyond their means. I learned a lot from Dave and use his principles. I don’t follow it to a t, but is good advice IMO.

[BirdDogey]

You are still out the principal whether you save up or finance a car. Peace of mind has value.

[raynful]

let me help you with this, if you take out a loan that your paying interest on and whatever other fees they tack on, to buy something going down in value like a rock, you are what is known as stupid .

[TruthUncensored_]

I learned so much at the Better Wealth Key Workshop in November. One of the most impacting takeaways was "opportunity costs." Totally changed my mind on intentionally carrying an affordable "good debt" for the sake of keeping liquid assets available for the moment an investment opportunity "knocks" on the door, offering a higher rate of return and the possibility of creating cash flow that will outlast the interest that would have been saved by paying cash. Mind blowing! Thanks, Caleb.

[obiflex]

Dave Ramsey is totally correct on never borrowing to buy a car and he's rarely right

[ntokozofish]

He needs to invite rich people to his show and ask them if they have credit cards

[ganthc]

Dave’s main contention is that he drills the mantra, “Your greatest wealth building tool is your income.” So if the average car payment is $500/mo, Dave would say that’s “stupid on steroids.” His biggest problem is the payment, and what that does to the average household income. I agree with you on there being good debt. But Dave preaches to debt addicts, so you’re correct that he can’t give any exceptions. I think the way to look at Dave Ramsey and his advice is that it’s a great and easy way for financially illiterate or irresponsible people to get out of debt and build wealth. And even if his 12% investing was half wrong, you’d still have $2.5M. But just like normal people wouldn’t follow the get your life straight plan that a meth addict would, financially sound people don’t have to simplify their future with Dave’s strategies.