Use My Savings to Invest More?

Use My Savings to Invest More?

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• The Ramsey Show (Highlights):

[Je.rone_]

I imagine there's no better feeling than having your house paid off, the stability you would feel

[Thomas-setb]

A Roth is only $6000 a year to max out. I don’t see why she isn’t doing this to begin with when she is fully capable.

[jordanaubrey-realestateinv]

Investing > Saving
Saving comfort you
Invest set you Free.

[CaseyBurnsInvesting]

Savings rates are ridiculously low. No need to over do it on cash.

[medviation]

I've watched so many Dave Ramsey videos, I now have a little Dave Ramsey inside my head talking to me all the time telling me what to do with my finances.

[trich]

2:18 Rachel almost called him "dad" lol

[TheKeyTakeaway]

If Dave were to give advice on an individual basis there would be different recommendations to each person, however since the system is meant to be one-size-fits-all, people always get the same answers. The emergency fund is money that is constantly depreciating, until it isn't. It's like insurance, you keep it there and you know that if nothing happens there would have been a better use for it. But if you don't have it available and something happens, you could end up selling on a bear market and lose out more.

The recommendation to pay off debt first no matter what is because it will be the best decision for *most* people, but, in my opinion, not for all. The reason that people want to invest as early as possible is explained clearly by Tony Robbins and others like Brian Ursu in books, that if you start investing during your 20s and then stop vs somebody that starts at 30 all the way through 65, the individual that invested during their 20s, and stopped for good, will ultimately have more net work by the time of retirement (assuming both individuals invest the same amount annually). That's why people want to start earlier, due to effects of compounding.

But again, for the majority of people, paying off debt is the smarter move.

[vanguardvaluist]

Doubling every 7 years assumes a 10.28% rate of return. High in my opinion for projecting but to each their own. I am amazed how many people do not understand how compounding and historic rates of return work- especially when they have 400k invested. It's called a compound interest calculator (free online). Suggestion is to actually use one. It's painfully EASY.

[Big-Government-Is-The-Problem]

time is the most important variable in investing and compound interest, and dave is telling them to wait 4-8 years to start investing more which would likely get them a 7+% average growth which is way more than their 2.2% mortgage. this math is simply wrong.
i support the debt free lifestyle, but sometimes paying off the mortgage quicker just doesn't make sense.

[EMo-rxpm]

We were in about exact same situation at that age. We paid off house and never regretted it. For us, the peace of mind of having house paid for was very valuable.

[pey]

Lol paying off a 2.25% mortgage before investing in your early 30s.. what a mistake. They'll be substantially richer if they max out all investments and just pay the 2.25% house off in 8 years

[kylesizemore]

Oh my god a 2.25% interest and he is telling them to pay down the mortgage instead of investing in a tax advantaged account. Paying the house down instead of maxing everything out will cost them literally hundreds of thousands of dollars in the long run. Sticking to 15% when you have the means to save much more than that is absolutely incorrect. THEN to say they should fire their advisor for getting them an incredible refinance and telling them the mathematically correct thing to do in their situation is insane and toxic.

[koreanplayboy]

400K in savings at 31... majority of Americans don't even have 10k in savings

[jamessamy]

Yes paying of the mortgage as soon as possible is the game plan. Interest will dig into the wallet.
I am going to clear in 3years and invest

[SRArndt]

These are financially responsible people are in their early 30’s with a 2.25% mortgage. Given the exceptional advantages of a Roth IRA and a 2.25% opportunity cost, in particular with such a long time horizon, this advise seems short sighted. Love you Dave, but the one size fits all advise isn’t valid in all scenarios.

[lmelior]

Yes. ALWAYS use up all of your tax-advantaged space before paying off your mortgage. Even leaving aside the likelihood that you'll end up well ahead financially (~10% average returns vs ~3% [i.e. mortgage interest rate] guaranteed return, both ignoring inflation), once those contribution windows close, they're gone for good. You can't go back and make them up.

Not following the DR financial dogmatism doesn't make advisors bad, especially when their advice is statistically superior.

[lennoxmutterick]

Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got to talking about investment and money. I started investing with $150k and in the first 2 months, my portfolio was reading $274, 800. Crazy right!, I decided to reinvest my profit and get more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family.

[jamanwithaplan]

As long as you got 3-6months of emergency fund. Pour all the rest in investing and make that thing grow like a eucalyptus tree 🎄

[Coolwater]

I love when dave decides that the call is over and hits that little button to hang up the call in the middle of the conversation 😂

[livefreewithcalebd]

As long as you have 3 months of savings why not