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  1. #1

    Why I'm not a Ramseyite

    IOW, throw the baby out with the bathwater instead

  2. #2
    Dogma sells, and that's what Dave keeps regurgitating.

    Cutting up my credit card because I misuse it is like taking away my car because I might drive it recklessly and cause an accident. Or taking away my elmers glue because I might sniff it.

    Come on, man!

    Credit is GREAT if you use it as a tool. A hammer is a wonderful tool, but only if you use it as it is intended. If you use it to beat your wife or repair the TV, those are going to cause you some problems. But that doesn't mean the hammer is bad. It means you're an idiot.

  3. #3
    Ramsey beats the credit card thing into the ground because, whether they realize it or not, there are some people in this world who cannot control their spending - and certainly not when they're spending other people's borrowed money.

    As a practical matter, there isn't really an accommodation to be made with such people. When a guy winds up in AA because he starts drinking after work on Friday, then goes on a bender and spends the weekend in a blackout, AA isn't going to waste time preaching to him methods for "drinking responsibly." They're going to tell the guy, "Look - you can't drink alcohol. Ever. If you could control how you drank, you wouldn't be here. But you can't. You can't ever touch the stuff again."

    And so it is with credit cards. Some people can charge a balance to them, and pay their bill off at the end of the month, without fail (and never mind that they probably spent more money than they would have if they paid cash or used their debit card). But some people start digging a hole, and when they finally realize how deep they've gotten themselves, they respond by trying to get a bigger shovel.

    Ramsey is an absolutist about this because if he advises a half-measure to the credo-holics, they'll never pull themselves out of the hole they dug for themselves. And if he preaches one set of rules to one group that can't control themselves, and a different set to people who can, some people in the first group will imagine that they're actually in the second group, but often without even adopting the less stringent rules (again, helping them not at all).

    Every now and then, somebody calls Ramsey's show just to argue with him about their credit cards and why it makes more sense (for them) to keep the cards rather than cut them up, given that they are so responsible with using them. And it's always an interesting call to me - that someone who isn't in financial difficulty would take the time to call his show because he's telling people to cut their cards up. Me, I just ignore advice that I feel doesn't well apply to me. I don't wind myself up over the idea that some people might actually benefit from the advice. It suggests to me that they aren't quite as confident in the wisdom of their choice as they'd like the world to think they are.

  4. #4
    But -- to follow your analogy -- he's telling non-alcoholics who drink in moderation to stop drinking. That's stupid, and will succeed just as well as the Temperance movement did when it shifted from pushing temperance to pushing total abstinence.

    Quoting him: "of those with credit card debt". By definition, that means there are people without credit card debt.

  5. #5
    I will never understand the overall dislike for Dave Ramsey.
    His principles are: get rid of debt, don't use a credit card, invest 15% of your gross, and give. Are some things mathematically debatable? Yes. But overall, I think it is a great strategy. How in the world can you hate this guy?

    I'm not against using credit cards. However, I was enlightened when a fortune 25 company I use to work for pushed employees to get consumers to sign up for their store credit card at a meeting because consumers "spend 3 times more money" with the credit card than with cash. I heard that straight from the horse's mouth.

    Guys like Dave Ramsey, Suze Orman, and Grant Cardone are great communicators with the general population. If you are a teacher, which we all are to some extent, your knowledge is useless if you are unable to communicate it to the receiver. The aforementioned know their audience very well. I worked in the IT field about 6 years ago and it was an "art" to communicate to the end user.



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