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I started listening to Dave Ramsey a couple of years ago. What he says makes so much sense, perhaps because he's been in the position of being in lots of debt and made his way out of it. Does anyone else listen to him and follow the principals that he teaches?
We've listened to Dave Ramsey for a couple or three years and he's so knowledgeable about debt and getting out of debt. We're trying to follow what he teaches, but sometimes it's hard to.
This will get me burned at the stake....
I too have listened to him. He offers good advice (imho), has a lot of good things to say and blah blah blah...
That said, he once said something that to me was 100% idiotic and frankly, blew a lot of my positive thoughts for him.
Cutting to the chase, someone was concerned about their stock portfolio and what might they do since it was down (I think this was during the decline of late 2007 and early/mid 2008)
They were down something like 40%
His comment to them was (paraphrased)
"Don't sell anything now, because you have lost nothing until you sell it"
I could not disagree with him more violently.
Mind you, I am NOT addressing his thoughts on should they keep what they have & hold on or perhaps restructure into a different portfolio mix.... I'm ok with someone keeping what they have during that downturn, IF IT MAKES SENSE.
No, my real problem with his comment was the comment itself.
"You haven't lost anything until you sell"
BS!!!
If you have $100K sitting in the account and the market takes it down to $50K you have in fact, lost $50K, period. Now, we might put the technical term in there of "unrealized" or "realized" loss....fine....we're splitting hairs. The money is gone. The bank certainly won't lend you $100K using this account as collateral since it's only worth $50K...why so? it's not "lost anything"???
I think he BS'ed that comment so thick I had to turn the channel.
Now, parallel that to someone who perhaps accidently, SOLD their portfolio at a certain time and sold it when it was worth $100K. Now, these two people call Mr. Ramsey and one has 100K in cash....this other person has $50K in their account. Both want to pull money out. The idiotic gall of him to tell the person with $50K that "you've not lost anything because you haven't sold yet" is idiotic.
I still can't get that stupidity out of my memory.
I do not listen to him personally, but I have read lots of get out of debt books that all say the same thing and quite frankly they don't work for everyone. I have pared down all my debt and living expenses to the bare essentials. I do not have cable, I don't go out to eat or for entertainment, etc and still I don't have enough extra to make a discernible dent in my debt. So I think he's got good things to say they just won't work for everyone.
I'm very surprised that Dave Ramsey would give stupid advice like he did about selling those stocks. If I had stocks that the value had been cut in half, I'd sell in a heartbeat (probably long before they lost half their value). I know where he's coming from, though. The stocks could go back up and technically, no cash was lost. It was all on paper. Still, that was very poor advice coming from him.
You have to remember that it is all "advice". Listen to it, but you have to use your own judgement and make your own decisions. What works for some may not work for others.
For sure. I like Dave Ramsey and respect him a lot for how he built himself back up from a mound of debt. He has a lot of good advice that people should follow.
I have to be honest and say that I have never listened to Dave. I thought about it often and I'm sure it worked for him (what he teaches). I know a lot of people that do listen to him and read his books too. I'm not in debt right now (not bad debt) but I still thought about listening to him.