Until they got out of debt, I have no qualms about people spending money...if they have it and are in good financial shape.
Dave Ramsey Financial Advice
- Thread starter Bobber
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Until they got out of debt, I have no qualms about people spending money...if they have it and are in good financial shape.
yes I agree but disagree, one thing I have learned though is it takes money to make money.
ya I find this truly sad. But I refuse to accept the birth control/neutering by financial status, i have children and give them a good life. No one will tell me I can't, I was also willing to sacrifice other thing, though.
your two points here, on the 25%, you'll never own a home till in your mid 30s then and you'll want a bigger home then this threshold anyways, well maybe, I won't look in to absolutes.
unfortunately you have to make mistakes to learn and these tend to be the best lessons. I promise your gods won't hate you if you make mistakes and have to start over. It does happen people, ask Ramsey. Not that you shouldn't avoid them if you can but invariably that how we learn. We in the middle class have to be scrappy with money as its hard to free it up to make it earn more of its own. As I said earlier one thing that is painfully obvious to me is "money makes money" and not much else.
How do you figure this? $1000/month = 25% of $4000. A lot of people make 48k in their twenties and there are a lot of houses in Iowa for 1000/month. I really don't understand this at all.
I guess I really don't have my pulse on the world, I'm sure most of the guys in my company (which is surveying/engineering firm) don't make this, even some that are older than me.
Totally true, hell just look at what happened when the housing bubble burst and suddenly free money wasn't so readily available to anyone. If everyone was saving and conservative on their spending consumer spending and the economy would take a significant hit. Of course, long term debt problems are probably even more problematic... some happy medium between extreme saving and spending is probably best for economic growth.
I think 48k is lower than average starting for new Civil Engineering grads, however, we do live in iowa.
Sheesh I am in the wrong field. It's depressing knowing 23 year olds make more than me.
Wouldn't you rather have people who are financially secure than make sure trinkets from China are sold at a steady level? Consumer staples will always be manufactured and sold, it's the worthless junk I don't care about losing. Japanese save 18-20% of their net pay and they still have a great standard of living.
ok - 48k gross = 34k net after insurance/taxes/retirement. 34 x .25 = $708/month on mortgage. That's certainly doable in many parts of Iowa and in the cities if you don't want a nice house.
Great call. Parents of high school seniors should listen to this. Reinforces my belief that much of the higher education system is a scam.
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As a few posters have said a guy like Dave may not be the way, I kinda liken it to health/fitness. People who attend Weight Watchers may do so for a set plan/strategy, etc, but common knowledge knows healthy food/activity is the way to go.
Same could be said for a fitness class ...you could do most of that stuff without the class, but the psychology of it helps.
Same could be said for a fitness class ...you could do most of that stuff without the class, but the psychology of it helps.
People spend money things that they say the "need" but actually just "want".
I know someone close to me that moved into a house (with a roomate) that was way over what he could get financed for even back when people were handing out money if you could sign your name. Ended up with two mortgages on the house before he ever moved in.
Next thing was that he didnt have any furniture for the house so he went to the furniture store and bought a bunch of stuff on credit. Couch, table, TV stereo etc. all on credit.
His friend moved out, signed over the mortgage and left all of the furniture but all of the bills as well.
His car went to crap so he "had" to have a 2 yr old Jeep Grand Cherokee and he "needed" another TV for his bedroom.
Oh and the Jeep needed an automatic start so it was warm.
The moral of the story is that EVERYTHING has to go on credit because people like this dont have money saved to buy even what I consider to be small things like furniture or a TV.
The guy in the story has to borrow money from his parent to put tires on his jeep and he's 40 yrs old.
Everyone has a different opinion on money and how it should be spent.
I do know that I read Dave Ramesy TMM about a year ago and my wife and I were already doing much of what he said. I did learn a few things that I am applying to my life now.
Simple principal "Buy stuff for cash (other than mortgage)", if you dont have the cash then you probably cant afford it. Cars are horrible investments, dont go into debt for a car see above statement. Home furnishings, clothes, etc should not be purchase unless you have the cash. Period.
I do know that I read Dave Ramesy TMM about a year ago and my wife and I were already doing much of what he said. I did learn a few things that I am applying to my life now.
Simple principal "Buy stuff for cash (other than mortgage)", if you dont have the cash then you probably cant afford it. Cars are horrible investments, dont go into debt for a car see above statement. Home furnishings, clothes, etc should not be purchase unless you have the cash. Period.
I wouldn't consider a car an investment, but more of a necessity. It is really a matter of not going overboard when taking out a loan.
Well, it's about transportation. Do you need a shiny new car or does a 10-year old Buick get you there?
Agree. When you lease a car you can't afford to own to show off a wealth status you don't have, the necessity part is severely diminished.
Haven't had a car payment in 4 years and have saved enough cash to buy an almost new car. It's not fun to drive a crappy car for a few years but having enough money to buy a car without a loan is a pretty good feeling.
I've wasted a lot of money on cars since I was young. I still waste money on them but about 3 cars ago I decided that I would never borrow another cent to buy a car. Last year it felt very good to go in and pay cash for a new SUV for the wife.
