Is Dave Ramsey Wrong?

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00:00 Intro
00:32 Where Dave is Right
01:46 Credit Cards
03:45 Student Loan Repayment
06:21 Leveraged Real Estate
09:00 Final Thoughts

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**Disclaimer: neither this video, nor any content produced by Caleb Hammer should ever be considered investing advice or official financial advice. All content is made for entertainment and educational purposes**
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Let me start off by saying that I personally have nothing against Dave Ramsey.

I don’t judge people based on their financial viewpoint or personal politics. I judge people based on their everyday actions.

And let’s be honest, Dave Ramey has helped millions of people get ahold of their personal finances and get to a point where they can retire comfortably… which is not the average American story we hear about today.

I’ve had the same conversation with my friends who are into personal finance multiple times, and the concussion we always have is “Dave Ramsey is perfect for the average American, but not the rare few who are able to be disciplined with money and spend time daily care about finances.

But again, to be clear, what Dave Ramey is teaching is the perfect message and lesson for the average American.

Why is that?

Well, the average American has:
An average new car payment of $575 a month or an average used car payment of $397… both with a 70-month loan repayment… kill me now
An average credit debt of $6,194
An average monthly mortgage of $1,487
An average net worth of $121,760

All while 56% of Americans cannot afford a $1,000 emergency if one were to pop up right now.

All those terrifying statistics aside, Dave Ramsey and his team have led thousands of people to become millionaires by the time of retirement.

Simply put, even if you don’t agree with his politics or stances on everything, he has turned the lives of millions of people around… and that’s always something to celebrate.

But you saw the title of the video, you want me to get into the good stuff. What do I disagree with from a personal financial standpoint with Dave Ramsey?

1) Credit Cards
2) Paying off Student Loans Early
3) Leverage on Rental Properties.

So, I said it before and I’ll say it again… his financial advice works for the vast majority of Americans who are living pay check to pay check and can never seem to get out of consumer debt…

And I am not against his education or philosophy on that…

But if you are watching this video, you are likely in a place where you are in financial education or at least trying to become so, and maybe his one size fits all approach does not work for you, which is not a diss on Dave Ramsey in the slightest.

Give this video a like and drop any comments below so that YouTube recommends this video to other people. Subscribe and stick around for more. Thanks.

[CalebHammer]

Personally, I like Dave! He is perfect for the average American. For those of us who are aggressively financially disciplined, does his one-size-fits-all approach work for us? 1 of my first 10, 000 subscribers will win $1, 000, and 5 will each win $100. You will be randomly selected and announced within the first week of hitting 10, 000 subscribers!

[savvybudgetgirl]

Awesome video! Dave is definitely not for everybody and I appreciate you taking the time to break this down.

[RandallHallKaizenReiki]

I really think the "No credit cards" thing has become his brand. He has to keep that message going. Since most people think they are the exception, not the rule; teaching a no exception system will help the most people.

And like you said, even financially responsible people will succeed on his system.

[chrystina]

Thanks for sharing your stance on this. Dave changed my life, and now your channel is keeping me motivated!

[lindab]

Hi Caleb, love your channel. I’ve been watching them nonstop!!
Question : for school loans with internet rates like 6.8 percent, how do you recommend tackling those?
Curious to know your thoughts .

Also- will you consider doing a call in Q and A portion for your show? Would be cool for folks who don’t wanna be seen but may have financial questions .

Thanks for the good content

[freddybie]

Dave was one of the first finance people I found on YouTube, and his videos pushed me to be better with money. After I started to turn things around I realized that not all of the guidelines were right for me. I believe that as long as you are not going into debt, have a reasonable emergency fund for your situation, and are saving for now, and the future, you are better that 90%+ of Americans today.

[RJmech]

All that said, I'll avoid the risk of playing kissy face with the bank. 😁
Thanks for presenting your thoughts. I'm happy to have followed Dave's plan carefully, and the structured focus helped me to achieve some remarkable goals with more yet to come. Although we might see some of these details through a different lens, I'm happy to subscribe and hear different ideas, and to watch your audit videos. Well done!

[christopherschultz]

Love the video! I am just starting my education, and the frustration of not being taught my entire life about this stuff has finally hit it's limit.

[OPDNETWORK]

You are so right I followed Dave Ramsey I listen to a lot of things that he said however Dave is a little out of touch with the times I said not to listen to anybody 100% I tend to take a little bit out of everybody’s information and make him home I love what you doing bro keep on the good work

[daelkolwitz]

Caleb, I appreciate you and your content. When you talk about real estate snowballing, this is what my father would do. It's great when people pay, but when there are hiccups in the economy (2008-2010), (2020-2022), it becomes a house of cards.

Today he is 71 and still working because he lost everything.

A man with an opinion will never change the mind of a man with an experience.

[LB]

Good video. When I took Dave's course I don't remember him saying not to take on a mortgage and instead pay in cash (it was years ago). But I do remember him talking about paying for a car in cash. Also, regarding credit cards if there is fraudulent activity credit cards are more protected, you just contact the card and dispute it vs. contacting the bank (if you used your bank card) and disputing and waiting for the money to get back into your account.

[taylorscott-frhs]

Thank you for this video. I think people often forget that not every method was made for you. Thant's what I think when I see people criticize different debt payment methods. it's not dated it may just not be made for you. that is why it is important to meet with a financial advisor and see what works best for you. Dave Ramsey methods work but anyone who has surpassed the baby steps should defiantly start looking into better methods to make and maintain money when they are financially stable. again, wonderful video! keep it up.

[TheHootnany]

I agree that holding low interest student debt longer just making minimum payments and investing the extra money is more gains in the long run, but I'd rather pay off sooner cause I have had more than enough of my fair share of sudden layoffs without notice in this country.

[Chicagocubbiegirl]

I consider myself financially responsible and I use a credit card for the rewards, pay it off every month, which earns me about 1k a year. But they do scare me. It is very easy to build up a balance.

[MsSarahJam]

This is a great compare and contrast video. Thanks Caleb.

[micheldwson]

Great videos, I would say it’s a little ambitious to assume that returns on S&P 500 are always going to be positive. There are a lot of economic issues besides inflation that might make such expectations fall flat. People say well history says returns are always 10% but there is less than a century that says that’s true. You’re probably right but just don’t assume.

[sameerazer]

I grew up with rubbing alcohol being the standard method to treating cuts and scrapes. 30 years later, I learned that alcohol kills the bad bacteria but also the good bacteria. Some of this good bacteria helps with wound healing. So I learned to use Neosporin instead of rubbing alcohol.

I feel like Dave is like ol' trusty rubbing alcohol. If it's all you got, it works. But there are more optimal solutions out there, which minimize the undesired side effects.

[utunum]

I didn't know about the 90 day loans, thanks!
I agree, being financially literate makes Dave Ramsey does really help me.

[utzwsoo]

Dave Ramsey makes it simple, so for people overwhelmed by financial trouble, gives you some ideas to keep straight in your head. Nuance is for when things are more under control and you need to start making choices about where to invest.

[nobeliefisok]

Ive been saying for years that Dave's advice is a starting point for people that are ignorant of how money works, or undisciplined. Once you solve your underlying behavioral issues, then Dave's advice is just bad. Debt is a useful tool. Credit is a useful tool. Obsessively avoiding spending any money is a waste of 40 years of life.

For me, I get so much value from rewards card per year. I never carry a balance on credit cards, and haven't for three decades. But I do put every possible form of spending onto credits cards, including my electric bill, garbage pickup, cell phone, water bill, gas bill, daily spending (groceries, gas, etc), and everything else. I do not buy anything just because I have credit available. I always have tons of available credit because when you do pay off your credit card every month, pay your auto loan if you have one, pay your house loan if you have one... the credit card companies throw money your way.