I have recently read several posts, opinion articles, and forum comments, all with the same common thread; Dave Ramsey is out of touch. I’m a Dave Ramsey fan. He was one of the first resources I found when I began my personal finance journey back in 2010. I don’t regularly listen to his daily radio show because I’m at work but do download his podcast and listen at night and weekends. I’m still inspired every time I hear someone perform a debt-free scream on his show.
Dave Ramsey offers practical, common-sense advice for those just starting to organizing their money and get out of debt. His baby steps outline seven easy steps to get you started in turning your money management skills around.
When my family and I needed information, the Dave Ramsey steps were very helpful in getting us on the right track. His book The Total Money Makeover is a great read and helped motivate us to take the plunge to get my finances in order.
Over time I have found plenty of other great resources too, which have also helped shape my financial plan over the last few years. So as I move forward, I’m a combination of all of this great information I have collected included bits of the Dave Ramsey steps. I don’t believe in taking everything he says and run with it, I listen and see what fits or doesn’t for my personal finance situation. So why just straight-up bash the guy when his advice helps others?
Dave Ramsey Steps – The Complaints
I’ll summarize, because I don’t want to call attention to the information I’m referencing, but a quick Google search will find several articles on the topic. You may have even read some of them on your favorite personal finance blogs. Here are some of the chief complaints:
- Debt Snowball Doesn’t Make Sense – Your rack up interest charges
- Paper Currency is a thing of the past – Millennials don’t use cash
- Dave’s investing advice is weak – 12% returns are impossible
- Mimicking Rich people’s habits doesn’t work for everyone – poverty-stricken people don’t have these opportunities
- He mistreats callers, especially women.
Let’s review each of these and understand the beef with the Dave Ramsey steps.
Dave Ramsey – The Reality
Let’s review each of the above points.
Debt Snow Ball Doesn’t Make Sense – Your rack up interest charges.
My family and I used the debt snowball technique for over four years, and we paid off over $109K worth of credit card debt. I was able to negotiate with my creditors and lower my interest rates to as low as 1.5%. The snowball has worked for me. The debt snowball has worked for many others too.
Yes, depending on your situation, the debt avalanche where you attack the highest interest debt first, might be better for you. Either one will work. We found that by following the Dave Ramsey Steps, using the snowball, we built momentum, and reduce money stress in our life.
The fact that I read and learned the Dave Ramsey steps allowed me to learn about the debt avalanche too.
Paper Currency is a thing of the past – Millennials don’t use cash
I’m a Gen X kid, and my choice of payment is a debit card, sometimes I use cash. So just because Dave states to use cash, you take shots at him, and not think for yourself?
I don’t care what age you are, use what method of purchase that works best for you, but the point of it is, pay yourself first, and spend less than you make.
Dave’s investing advice is weak – 12% returns are impossible
I agree Dave’s investment advice or project returns percentage isn’t the strongest, but if you know nothing about investing, dropping your retirement money in mutual funds and let them bake for 20-30 years isn’t an evil plan. Yes, you will not see consistent 12% returns, but I’m sure your net worth will grow.
I think that’s Dave’s point he’s trying to give general tips to a broad audience. If, at the very least, this should give you a retirement planning start and sparked the interest to seek more information.
Mimicking Rich people’s habits doesn’t work for everyone – poverty-stricken people don’t have these opportunities
I read books, listen to podcasts, and watch videos about successful people all the time, my goal? To learn from others who have become successful and try to duplicate it.
Isn’t this is the basic principle of the book widely popular book The Millionaire Next Door? The author interview millionaire and reveals their secrets on building wealth. This type of information can all be found at your public library if you are willing to find it.
He mistreats callers, especially women.
I agree Dave can be rude and abrupt with some of his callers. When you call his show and ask a question that bends or breaks the rules of his steps, I expect you get a virtual slap in the back of the head.
I’ve heard him scream at men, women, young adults, and elderly callers. He’s consistent and doesn’t discriminate. If you ask a stupid question, expect a firey answer.
They do call it a rant for a reason. A rant is defined as to speak or shout at length in a wild, impassioned way. Hell, his best rants can be found on YouTube, labeled as “rants.” Dave is also hosting a radio show; yelling and screaming does add some entertainment value.
I’m a dad of three children, two sons, and a daughter. I want the best for all three equally. I don’t sugar coat lessons for my daughter because she’s female. All three get treating equally good and bad, depending on the situation.
Final Thoughts on Dave Ramsey
I still believe many of the things Dave talks about and teaches are relevant today, no matter when you were born or your gender. My approach with this information is I find what best for my situation, whether I’m trying to pay off debt, saving money, or reach financial independence. I do this with all of the books, blogs, podcasts, etc. that I consume. I never just blindly follow someone’s advice.
They call it personal finance for a reason.
I’m sure people like to take shots at Dave Ramsey for the sheer fact that he’s been so successful for so long. Many of us want to try to knock the guy off on top because it usually draws attention. Keep up the great work, Dave. I’ll continue to listen with a grain of salt, and make the best of the information you provide for my situation.
What do you think of Dave? Do the Dave Ramsey steps still offer value in the personal finance world?
Brian is a Dad, husband, and an IT professional by trade. A Personal Finance Blogger since 2013. Who, with his family, has successfully paid off over $100K worth of consumer debt. Now that Brian is debt free, his mission is to help his three children prepare for their financial lives and educate others to achieved financial success. Brian is involved in his local community. As a Financial Committee Chair with the Board of Education of his local school district, he has helped successfully launch a K-12 financial literacy program in a six thousand student district.