350 posts to establish a nice circular logic. Amazing discoveries on the internets.

Not really circular...

If they need his advice, then they can't just use math and common sense.

By modus ponens:

They need his advice, therefore, they can't just use math and common sense.

Also, by modus tollens:

if they can just use math and common sense, then they don't need his advice.

Not circular...

Yes, it's dumb. But that's also not a fair comparison (no one gives 0% loans). The target of Ramsey's advice would have $10k at 20% and $15k at 25%. To Ramsey, the psychological benefit of paying one off the lower amount offsets the interest savings.

So what kind of debt did you pay off? If it were credit cards, then you can just live off the credit cards for a while. But it seems like it wasn't credit cards.

The people who call into his show with $100k CC debt are not capable of using "math and common sense". If they used math and common sense, they wouldn't have gotten into $100k CC debt in the first place.

That is who his advice is geared to. Not people like you.

awesome how it is some guy on the radio's fault that you are broke and jobless...


accountability and personal responsibility are a lost art form, I guess

Couldn't you start charging again? Emergency funds are so less important now with a huge amount of credit available.

That wasn't circular logic.

This is completely untrue.

There are plenty of places where, if you buy something, they will finance it at 0% over X years.

At 0% it seems better than just paying for the item.

Some are truly 0% for a while then switch to a normal rate, others have a balloon payment if you don't pay up in time (can still be good, but you must have the cash, and it's not really worth it).

I paid off a couple of 0% debts with the cash, another with a potential balloon payment if I didn't pay it and and bunch of little things with high rates. I also paid off several medical bills that, again, were mostly 0% so long as I was sending them fixed payments every month.

These are not loans in the conventional sense, but they _are_ debts that needed to be paid, and following the ramsey plan, I paid off a bunch of essentially 0% debt in addition to some high interest stuff. If I want to reborrow that money, I'll be paying about 11% for an unsecured line of credit/ loan.

(I have negative equity in my home, so no HELOC for me, and it's hard to get any loan at all with no current employment.)

Note: not complaining at all, just pointing out some problems with a plan that sounds nice in theory.

This wasn't CC debt (for the most part) - it's was medical bills on 0% payment plans and a few items that were again on fixed payment, 0% plans. I don't really have an extra available revolving credit. Can I get some? Probably, but it will cost me 11% for an unsecured loan, and that's if I commit fraud and lie about my employment status.

I never, ever said it was anyone's fault but my own.

It's my own fault, entirely.

I made the decisions and I face the consequences. "Dave" didn't make me do anything - I read the information and made the choices myself. The only person to blame is me, and I am the only one who is going to get myself unbroke and unjobless.

All I am doing here is showing that the "Ramsey Plan", despite being marketed as a great solution to money problems for damn near everyone, isn't so hot in certain specific circumstances.

Sure, it sounds good psychologically to pay off the smallest debts first, but perhaps this isn't such a great idea, especially with 0% debt. (He is emphatic about this point - he always wants you to pay off the smallest, even if the differential in rates is large.)

It's also a bad idea to get rid of a cash emergency fund if you already have one to "jump start" the plan. If you already have 3-6 months of expenses cash saved, keep it. The added risk is not worth the added benefit.

Third: his investing advice is pretty lousy. It seems to mostly consist of 4 different mutual funds where he insists you can average > 12%. He repeatedly makes statements like "There has never been a 10 year period where investing in the stock market has not made money" that are provably false. Much of the time, he just wants to send you to one of his ELP partners.

The general approach that Dave takes to getting out of debt, namely, don't try to play stupid games, just work your ass off and pay it off and never get into debt again, is gold. I totally agree with it. I disagree with some of the implementation and the "one size fits all" mentality (this mentality is really important if you are trying to market a system and get TV shows and book sales from it.)

This is exactly why the Ramsey plan is faulty. And it's exactly what my point has been since the beginning.

I like Ramsey's message to get free of debt as there are enough people that can't handle debt. But the fact that he advises to pay off the smallest rather than the most expensive debt is the dumbest thing I've heard.

It's like this thread is going around in circles faster and faster every page.

The question is how do people who are that retarded get that much credit? There is something wrong with the system as I can't imagine how they could have an income that could justify extending excessive credit yet they get it. I know a girl who managed to get herself into $70-80k of consumer debt despite being a receptionist that made $28k/year with no future prospects of making higher income. If someone already has a consumer credit equal to what they make in a year then they shouldn't qualify for more credit.

I figured there is something I didn't understand about credit because I never got why Ramsey stress the starter emergency fund. Just pay the debt and if an emergency happens use the credit.

Well in Ramsey's world, you burn the cards so you have 1k to live on. I probably would last a matter of days. Maybe 10.

ETA: The credit argument is complex and interesting. With parties to blame on both sides and ridiculous legislation abounding.