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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Dave Ramsey
Are any of you ladies doing his debt free plan? I am looking in to it, and was wondering what you guys thought. Is it realistic for you? Also, how long have you been at it/how much progress have you made?
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Re: Dave Ramsey
I may get flamed for this as I know there are a LOT of DR fans on here, but I am not. I work in the collections industry and previously in credit cards and banking. While I will not EVER claim to know it all, I have learned that it is not wise to be debt free - it hurts your credit, that is meaning you do not have any debt and not ties to any sort of credit at all.
Again, this is my opinion and I respect those that like DR.
It is a personal decision you have to make as to how you want to go about a budget plan, etc.
My 2 cents worth if it's even that, ha ha
I really enjoy his perspective, and although DH and I thankfully have no consumer debts, I think that what he sells to people can be very helpful for those that need his type of structure. One of my coworkers is following his plan and in just this past year alone, has paid off 20K of debt.
If you wanna chat about it further, feel free to email me...
edit: or you can FB message me or something... I think my email may be on my profile there? I am not sure...
Yeah, I totally didn't mean that to imply that you have serious debts...but more, I think that his program can really benefit people who are up to their eyeballs in debts and are really at their breaking point.
I know in our situation, we haven't necessarily been able to apply his debt reduction principles simply because our debts consist of a student loan and our house, but for people with lots of little small debts (up to and including their larger debts), his snowball makes a lot of sense and help keep people motivated because you see the results of your actions much quicker than you would if you were just flying by the seat of your pants. If that makes sense?
I can say that we have applied his thoughts on emergency funds, investing and holding off on "instant gratification" to our own financial lives. For me, I feel much better simply saving to make a big purchase, or vacation, or whatever...I just like knowing it is all paid in full. And I like having several months of E-fund money hanging around....especially in these times, although, I know Dave isn't the only financial guide who teaches from this perspective.
I think he is very practical, and motivating...and I think those are good things when it comes to money! But I do think you have to set your limits on how far you are willing to work his program, and make it work for your financial situation.
I will say that is wise for your credit score to still have a credit card, use it occasionally and then pay it off right away. With the economy the way it is, this only helps your credit score and if you don't have one or use it this way (I'm even talking just get gas on it once a week or month and then pay it off right away) then its also hurting your credit score. I have heard this from the industry experts and the credit scoring companies too.
Again, to each his own and I do think that what DR has to say is for those in serious debt.
i use mine for my plethora of dmb tickets....
but yeah, i pay it off immediately...
This, exactly. We had some consumer debt built up after the wedding and used the snowball method he suggests to pay them down. By this summer, all we will have left is a mortgage and one car!
Also, his books gave us a reality check on living within our means. We've always lived that way, but felt like "the poor kids" on the block because we hadn't financed new furniture, new appliances, a huge house, vacations, clothes, etc etc etc, and only bought what we could pay cash for. But after reading his book, I realized that we were actually being wise- and not prudes.
I *heart* DR!! My hubby and I went through his Financial Peace University....and it was wonderful! We both learned so much about saving...investing...and spending. We have been working really hard core since the first of the year to stick to his plan (it was our resolution together). We have our e~fund.....we have cut hundreds of dollars out of our monthly budget....and paid off several of our consumer debts..just since the first of the year!! We are still working like mad people on our budget every month....and really keeping ourselves in check about things that we purchase!
If you have any more specific questions I would be happy to answer them....or tell you in more detail about our experience with his program....feel free to email me! PinkLadyRN (at) gmail (dot) com!
I ditto this and agree with Katie and Jane. I love to pay for anything up front, but also realize that realistically a lot of big purchases are based on your credit score (even renting an apartment warrants a credit check). So by continuing to use a credit card and paying it off monthly is being responsible, making your credit score/history very attractive, and allows you to get better interest rates on big purchases like a car or home loan. That's how you work the system. We've been using the DR snowball for our credit card debt and it truly does make sense and saves you money in interest. Once we pay off everything, I will continue to use one credit card for minimal purchases and pay it off monthly to keep a good history. I wouldn't do this if so many things didn't revolve around a credit score, but they do. Your credit score is simply a measure of your desire to pay your loans/cc balances/bills, based on your current and past behavior. If you have no history of paying anything, that makes lenders as apprehensive to give you a loan as those who don't pay their bills on time or at all. It's not fair, but it's how it works. I had a friend who after college moved home with her parents, paid off all her cc debt, closed her cc accounts, saved money, and went to buy a new car but couldn't get a car loan b/c she didn't have a credit history for the length of time it was since she'd closed her accounts. After all of that, her dad had to cosign the loan on her first new car. Not everyone has a few hundred thousand dollars in the bank to pay for a new house in cash or buy a car with cash. It's possible, but not for a lot of people. Unfortunately, we'll still have to be subject to the system in some way.
Wow, that was LONG! LOL
I super heart y'all!!! I totally thought I was going to get flamed!!! ha ha
yes, wise to live w/in your means but in this economy it is not bad to have some debt as long as it's not forcing you to live outside those means. Hope I made sense.
I just don't agree that you should be 100% debt free as a whole. Some debt helps your credit get better and better.
LOVE Y'ALL!!!
I pretty much agree with everything everybody says. I really like DR and his principles and I'm currently in the middle of his book.
I think the snowball debt is a great idea. Unfortunately, DH and I are one of those people in serious debt and it was like that ever since before we were married. So I have been studying his plan for a few months now and I truly believe that it will help us get out of debt in a few years when we're ready to have a baby, purchase new vehicles, ect.
I'm a financial dummy and I didn't realize this about keeping one credit card open until I read Katie's and Alesha's responses. When I bought my my car 10 years ago I didn't have any credit at all so my dad had to cosign for me. Now that I have moved out of the house and married I don't want to burden my parents on any more of my financial decisions. As a matter of fact, DH took all of our credit cards but one to his work and shredded them all. So this makes alot of sense because I don't want us to run into any trouble with big purchases in the future.