"If you can't buy something with cash, don't buy it. Debt is debt." - Dave Ramsey

[Originalman]

For the common person credit is bad. It's giving themselves enough rope to hang themselves then watching them do it. Most people don't have the capacity to manage credit. It becomes a tool to live outside their means and acquire things that don't make them anything and go down in value.

And you are exactly right. Credit is bad for the avg poor to lower class america (who normally don't have high paying jobs and don't know how to manage their money).

I said it before on here that I know multiple used car dealers and even do business with them. Most their "wealth" has been built on poor and lower middle class folks buying shyt on credit.

I told on here how the hustle is to buy a 3k car from the auction put on someone who is poor and make them pay notes that you know they can't afford. Then when they get behind repo the car and sell it to another poor or lower middle class person and make them pay notes.

A lot and I mean a lot of times you can get 2 to 3 customers taking notes on that car. Eventually you will make 3 to 4 times the investment on the car.

For example this brotha I am tight with bought a used kia for 3500 from a auction. In about 1 year was able to turn the car over to 4 customers. Making around 15k on the car after you factor in high interest payments from customers, down payments from customers and the vehicle being repoed over and over.

This is a true example of the power of debt and interest.

 

[Originalman]

The average American has like $6000 in credit card debt. That isn't responsible. You saying all your people have good credit just means the people you associate with are in the minority.

Yeah most americans don't have good credit and most have very very little in savings.

You always see it when layoffs come then shyt hits the fan very quickly. Everyone needs to see that frontline report on credit cards either the late 90s or the early 2000s. It showed how many many americans were drowning in credit cards (not matter their economical background) and how the credit card companies loved this.

It also showed how the credit cards hate people like myself who pay the credit card off every week or month and were prone to figure out a way to cancel our cards. Cause of course they can't make profits (interest) on us.

 

[MoneyTron]

 

[Originalman]

In terms of investments, yea, risk is part of the equation and you can't let your money sit in a bank account if you want to make your money grow, but with that said, many people aren't financially solidified to worry about investing. It doesn't make sense to invest if you have thousands of dollars in debt on a high apr card... you need to pay that off first. A lot of these credit card companies get people hooked into buying stuff on this 0% interest if you pay it off on x date, but the interest rate is obscenely high, even to the tune of 30% apr if they miss a payment. All that needs to happen is a person losing their job and being dependent on that monthly income to make that payment for them to get spanked by one of these high interest loans.

Dave Ramsey, to me, doesn't seem to be catering his advice to the financially savvy. His advice seems to be catered to people who are perpetually having financial problems. Before they even need to think about investments, they need to get into the habit of learning to save their money and not put themselves in situations where their lives can be destroyed by interest. If you have no real debt, then by all means invest.

You don't need to have the full amount saved up for something like a car, but you should have several months worth of payments saved up in case you lose your job or some other emergency pops up.

Rich people can use debt creatively because they aren't living off of that debt and they are responsible with their money and will do due diligence on their investments. The last thing I'd tell someone who can barely stay afloat to do is go take a loan out to invest in something. They need basic financial habits first.

Thats exactly it Dave isn't talking to folks who can manage their money and aren't in over their head in 50k in credit card debt.

Normally he is talking to folks who are behind in their mortgage, rent, car payments. Maybe got 40 and 50k in credit card debt over material shyt or even 100k in student loans but make 35k a years.

He isn't meant for some person who makes 100k and got 50k in cash laying around and wants to invest cause all they bills paid off.

 

[newarkhiphop]

Dave ramsey saved my life can never slander him.

 

[winb83]

Yeah most americans don't have good credit and most have very very little in savings.

You always see it when layoffs come then shyt hits the fan very quickly. Everyone needs to see that frontline report on credit cards either the late 90s or the early 2000s. It showed how many many americans were drowning in credit cards (not matter their economical background) and how the credit card companies loved this.

It also showed how the credit cards hate people like myself who pay the credit card off every week or month and were prone to figure out a way to cancel our cards. Cause of course they can't make profits (interest) on us.

They get close to 2% of your purchases when you buy something. You're profitable to them just not their most profitable customer.

 

[CarltonJunior]

Hearing an old white man say "credit/debt is bad" is like hearing a black dude say "you know what, the KKK isn't bad."


White wealth IS credit. That's how they've surpassed everyone. Do not listen to this religious idiot brehs. Build your credit. Hell think about it this way: two people making the same money, with the same bills. One has a credit card, one doesn't. Which one will have more financial flexibility and be able to build wealth faster? The guy who is paying bills and trying to save money...or the guy who is paying bills with his credit card, building credit, and using that credit to extend his income. The guy who takes years to save up for a used car...or the guy who qualifies for an affordable loan a few months after getting a job? This ain't rocket science...

That final example wasn't that good. If they are making the same amount of money, the used car guy's money will bounce back faster than the guy who is paying for a car note, which is why a lot of people prefer used cars.

Housing might've been a better example. People should build good credit, but a breh making 50k with good credit vs. a breh making 50k with bad credit isn't that big of a gap. The bad credit breh will just have to be more patient to put bigger down payments on things. He'll just have less liquid. Once you approach the 6 figure mark and you get more expensive items credit building is a little more impactful.

 

[Colicat]

Thee definition of smart dumb

 

[beenz]

the one-size-fits all financial advice on this show is a major turn off.

 

[beenz]

He actually tells people that lol.

Of course his plan can work in Jacksonville florida where they have $100k single family homes

no he doesn't. he says u can ONLY buy a house that is 1/4th ur monthly income on ONLY a 15 year fixed rate mortgage. not sure where all these starter homes are located, but he ALWAYS says this.

 

[Silver Surfer]

Didn't read or listen

 

[dondatta24]

the one-size-fits all financial advice on this show is a major turn off.

Yeah, personal finance is just that; PERSONAL. One-size-fits-all approaches don't work. Your focus should be on identifying revenue streams that make sense for you specifically and living a sustainable lifestyle based on where you are in life (and continually assessing and adjusting based on circumstance changes and macro factors). Videos like this are a much better guide for courses of action:

 

[International Playa]

Yeah, personal finance is just that; PERSONAL. One-size-fits-all approaches don't work. Your focus should be on identifying revenue streams that make sense for you specifically and living a sustainable lifestyle based on where you are in life (and continually assessing and adjusting based on circumstance changes and macro factors). Videos like this are a much better guide for courses of action:

Dope video, most points are similar to Dave Ramsey's.

Get out of debt & stay out of debt, be disciplined to live within your means, budget & save, invest.

Dave is unrealistic about only 25% of your income going to your rent/mortgage in this economy. It should be no more than 40% of your income in this economy. He's advice for paying off your 15 year mortgage is unrealistic too.

 

[winb83]

Dope video, most points are similar to Dave Ramsey's.

Get out of debt & stay out of debt, be disciplined to live within your means, budget & save, invest.

Dave is unrealistic about only 25% of your income going to your rent/mortgage in this economy. It should be no more than 40% of your income in this economy. He's advice for paying off your 15 year mortgage is unrealistic too.

40% of your income going to rent / mortgage is unsustainable. He's absolutely right. I don't want more than 30% tops of my take home pay going to rent / mortgage.

Right now about 15% of my after tax pay goes to rent. If I got a mortgage it would probably go to 25%. I couldn't imagine how tight I'd have to live letting that number go to 40%.