My Reaction to Dave Ramsey | Phil Town

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money, loans, paying off loans, stock market, stocks, invest, how to save, passive income,

[PhilTownRuleInvesting]

What will YOU do with the money you have saved in the bank? Leave a comment below.

[DrogoBaggins]

This is how people with class disagree with others.

[VixGuyOfficial]

Watching great investors disagreeing each other with respectful debating and expressing their own insights is one of the best ways for us to learn. Thanks for sharing it! Cheers. :)

[williamc.fetterjr]

All I can say for certain is that listening to Dave Ramsey got me out of debt that was up to my eyes in 2009. I followed his "baby steps ". I'm a multimillionaire today with no personal debt, and several streams of income. Ive taught Daves strategies and thought process to both of my sons in hopes that they never put themselves into a terrible financial position like I did. I do believe that all personal debt is bad. Thank you Dave.

[arhgentumm]

The amount of sound sleep I get and a smile on my face every morning is only achievable with low to zero debt. No stress alone is more valuable than potential greater returns you could have gotten for your cash elsewhere.

[Stanley-ginb]

Investor coach vs personal finance coach. It’s just for different people.

[CoachJJ]

Man Phil, I love that I first found Dave’s work several years back, which helped me get on track, then found you (& our Rule 1 family) in 2018. Looking back, Dave Ramsey feels like finance 101, while your thought process was an advanced level class for me and my family. Thank you for helping me be much smarter about where I have my money and what to do about it!

[PeterPaulMasigan]

The most polite reaction video ever. Phil Town is a gent.

[DocPortland]

I went through Dave’s program about 8 years ago. I thought the same ‘why pay off a mortgage at 3.8%, when I can invest that money at 12%’. I understand those that say think that way. Those people generally think only in financial terms, and that’s also great. As a doc I really learned the psychology and emotional power of living debt free, with a paid off car and house. The emotional stability that comes with that is almost priceless. The power of debt free living is priceless without limit. Getting a better rate of return can’t compare to the stability it comes from debt free living. My 2 cents...

[marcleroux]

As Dave says, one should remember that debt equals risk. If you have a guaranteed income for the rest of your life then aiming at yield is a great idea.

If you lose your job in a financial crisis and dont have unemployment benefits, you could quickly find yourself without anything.

Investing isn't always about comparing returns, it's also about comparing risk and creating cushion for falls.

[concernedcitizen]

I think Dave's advice would help a different group of people than Phil's audience.
Dave's advice to stay debt free and invest into Index Funds generally works for people in the bottom strata of the economy.
These are the people went crazy with education, cars and fancy items, and become waist deep in debt and have no savings.
These people who live paycheck to paycheck might have zero financial education, let alone reading a balance sheet of a corporation.


Phil's audience, I assume, has a good amount of financial education coming in. Higher saving rate is a given.
Most of us here adhere by value investing strategy, and we think that investing into the market randomly is far riskier than a well researched individual company. I agree a little debt is good when the borrow money can help generate return greater than the interests. However, I don't think this would work for the vast majority of the population who has less than 1000 dollars in their bank account and can't balance their checking account.
I think Dave is doing a good work with his audience, and so does Phil with his. Good luck everyone!

[davidhidalgo]

At age 19 I found Ramsey and he guided me financially. Now that I’m 22 I watch him for entertainment but not for investment advice. He’s great for starters! I do a dividend based/secular stock portfolio

[Cesar-pqck]

Dave Ramsey saved our financial future! He’s family now.

[davidjones]

"Most of us have really strong demands on our entire paycheck"
This is exactly why Dave teaches people to pay off all of their consumer debt first before investing. Any debt that you carry around ties down your cash flow and is yet another hungry mouth to feed financially. Also, as Dave teaches, it's just as important to stay out of debt. There's not much point in getting hyper-focused and crushing debt that you have if you're just gonna go right back into it to pay for stuff like cars, vacations, etc.

From a value investing standpoint, I'd look at it this way: if you get focused and wipe out all (yes, even low interest) consumer debt that you have, that'll put you in position to jump on deals later. Not carrying debt keeps you financially flexible and able to jump on opportunities that you find.

[princeataya]

If you have over $60K in this callers case, paying off $1, 500 of car loan makes absolutely sense. Just saying.

[mrtdiver]

Re. the car. One thing you’re not adding into the equation Phil is “risk.” Something that Dave talks about. If this guy loses his job he can lose everything – his car, his house etc. So that’s why Dave is deadest against investing while still paying on a car.
Yes, Dave’s mutual fund advice is terrible. Thank you for showing us a better way Phil!

[Kn]

Dave Ramsey is the guy that ought to be advising the Fed.

[femflex]

Suze and Dave were my saviors when I got into trouble about 20 years ago. They are master teachers when it comes to helping people get control of their finances.

[Je.rone_]

I think Dave's advice is great for people who no serious interest in financial matters and also are financially undisciplined

[ecc]

One aspect of Dave’s teaching that sometimes gets missed is that he teaches that finances is 80% behavior, it’s not just about the math & where you can make an extra percentage point. That’s the reason for paying off the car first, then the car payment can go towards retirement or paying off the house. People get in trouble not because they can’t do math, it’s behavior.