Clark Howard vs Dave Ramsey - What a difference!

[mhconley]

I have to agree with you on this. DH and I plan to buy our DD15 the safest, most reliable car we can afford, with or without monthly payments. There is no way I want her out on the roads in a "beater" - as Dave calls them. "Beater", to me, implies more than old and ugly.

Dave also should not be giving investment advice - my DH cringes when he hears Dave giving that kind of advice. We think he should stick to strategies for getting and staying out of debt.

It all depends upon what you call a clunker. I sold my 2008 Mustang GT convertible and purchased a 1992 Ford Explorer with just 88,000 miles on the ticker. She looks and runs like new and she only cost me $1200 cash. That's $500 & change per month back in my pocket. I really doubt it'll ever cost me more than $600 per year to keep her on the road until I'm debt free, let alone the $6,000 she's saving me.

Martin

 

[jodifla]

I have to agree with you on this. DH and I plan to buy our DD15 the safest, most reliable car we can afford, with or without monthly payments. There is no way I want her out on the roads in a "beater" - as Dave calls them. "Beater", to me, implies more than old and ugly.

Dave also should not be giving investment advice - my DH cringes when he hears Dave giving that kind of advice. We think he should stick to strategies for getting and staying out of debt.

We create our own clunkers....Buy a car that's 2 to 5 years old for around 10 grand, then pay it off after a few years and keep it a good 8 years beyond the payoff date.

 

[bettymae1121]

I like DR's book TMM, I think it's the best plan to get out of debt I've seen, especially for those that are right on the edge and about to fall over. I don't care for his radio/tv show though. I've seen CH a few times, seems like a really nice guy.

I also like Suze Orman. With her it's not just what to do with your money/debt/investments but it's looking at the emotions behind your financial behavior. If a woman calls in about how her adult children are living at home for free and spending all her money, not only does she give advice about the financial aspect of it, but tries to get behind WHY that woman got into that situation to begin with and how to get her power back and her kids out of the house (or at least paying rent). Everyone knows that if you spend less you save more, but for many, many people they get into messes not because of the math, but because of their emotions and the relationships they have.

 

[MommaSnowwhite]

My DH and I have been a group leader for 2 FPU classes at our church. The church wants perple to pay for it ($100 for kit) because if you invest in it you are more likely to follow it and attend classes. I have seen the change FPU can make for families. I see nothing wrong with DR making money on his books and stuff.

 

[HHSTigerFan]

The church wants perple to pay for it ($100 for kit) because if you invest in it you are more likely to follow it and attend classes.

Bad financial advice aside, Dave sure can sell stuff....

 

[Purseval]

My DH and I have been a group leader for 2 FPU classes at our church. The church wants perple to pay for it ($100 for kit) because if you invest in it you are more likely to follow it and attend classes.

Isn't that the same rationale Health Clubs use to get people to sign long term contracts? We all know how well that works. Maybe the Budget board should start charging for every post you read so you'll be more likely to follow the advice

 

[Padstack]

Bad financial advice aside, Dave sure can sell stuff....

So, paying off debt is bad advice???

 

[punkin]

So, paying off debt is bad advice???

Sometimes, yes.

 

[palavra]

Happy I'm not the only one - now that we have our emergency fund stashed aside we're saving for our WDW vacation - then we start the debt snowball!

Martin

The problem I see with Dave is that the steps seem like you are always moving forward, like a check off list. In my reality, it hasn't quite worked that way. We've saved up an emergency fund twice now. Why? Because we had an emergency last year that wiped out our fund. So, in our case, we were literally back to step 1. It is pretty frustrating to be doing the right thing and get knocked off your feet again and again.

 

[sameyeyam]

I listen to both Clark & Dave. I started listening to Clark Howard many years ago. I think they both have some pros & cons.

However, that aside. One thing I notice is that Clark is about spending money wisely and Dave is about NOT spending money and paying off debt. I would love to see those two do a show together. I think they would drive each other crazy.

If I'm thinking of purchasing something I would definitely take Clark's advice over Dave's.

However, if I'm looking to pay off debt or set up a budget then I would take Dave's advice over Clark's.

I guess those of us that are smart listen to both of them and glean the best information that each has to offer for our individual situation.

 

[Padstack]

Sometimes, yes.

Okay, you keep thinking that way.

 

[HHSTigerFan]

Okay, you keep thinking that way.

My current mortgage is 4.5% and tax deductible... Dave likes to toss out 8% I believe as what you can expect as a return when investing in quality stocks..

So explain to me again why I should be in a rush to pay off my mortgage?

He also says to pay off your smallest accounts first, regardless of the APR.. so if I have two CC accounts, $12000 at 26% and $6000 at 8%, why again to I want to pay off the cheaper money first?

 

[maxiesmom]

He also says to pay off your smallest accounts first, regardless of the APR.. so if I have two CC accounts, $12000 at 26% and $6000 at 8%, why again to I want to pay off the cheaper money first?

To see results. Many people find it easier to keep going if they see results quickly. If you (in general) were that worried about paying high interest rates, you wouldn't have signed up for credit cards to begin with.

I do like Dave Ramsey. I finally know how to work a budget, which is not something I learned from my parents. Use whoever works for you. I guess I don't see what some people gain from knocking one or the other person.

 

[HHSTigerFan]

He also says "no CC's under any condition for anyone"... in whose world does this make sense??

I just left Target, spent about $225... used by 10% discount for having enough Target CC points and then got the standard 5% off, saved me about $32 off my bill... as I left the store, took out my debit card and paid the exact amount I just spent.. Yeah Dave, lets just throw away that $32 saved!!!

 

[HHSTigerFan]

To see results. Many people find it easier to keep going if they see results quickly. If you (in general) were that worried about paying high interest rates, you wouldn't have signed up for credit cards to begin with.

Then teach people to look at the big picture, that simple... thats solid financial advice!

 

[maxiesmom]

He also says "no CC's under any condition for anyone"... in whose world does this make sense??

I just left Target, spent about $225... used by 10% discount for having enough Target CC points and then got the standard 5% off, saved me about $32 off my bill... as I left the store, took out my debit card and paid the exact amount I just spent.. Yeah Dave, lets just throw away that $32 saved!!!

But not everyone has enough self control to pay of their cc bill at the exact moment they use it. Or at the end of the month. If you can, great for you, but I bet most people don't or can't. Or else they wouldn't have thousands of dollars or credit card debt.

Anyway, it is silly to think that because you don't agree with all one finanical guru or another says that they have nothing of value to offer.

 

[punkin]

Okay, you keep thinking that way.

I am thinking. I have not been brainwashed by Ramsey.

 

[HHSTigerFan]

But not everyone has enough self control to pay of their cc bill at the exact moment they use it. Or at the end of the month. If you can, great for you, but I bet most people don't or can't. Or else they wouldn't have thousands of dollars or credit card debt.

And there lies the biggest problem with his program... He says NO credit cards regardless of your financial responsibility, makes no sense..

 

[maxiesmom]

And there lies the biggest problem with his program... He says NO credit cards regardless of your financial responsibility, makes no sense..

So? That dosen't mean the rest of what he says makes no sense. I admit to being a bad Dave Ramsey follower. I do still have credit cards. I work retail, and we get more discounts where I work if we use the store credit card. And I just feel more secure having one as a back-up, even though I have my $1000 emergency fund in the bank. I am paying off the rest of my credit cards, and it feels good!

 

[mrodgers]

....and Dave is about NOT spending money and paying off debt.

I am following Dave's plan slightly. I have 2 young children and if I follow the plan completely as is as depicted at LLNOE forum, then I will have plenty of money to take my kids on fantastic vacations. Problem is, I'll be 80 and my kids will be over 50....

He also says to pay off your smallest accounts first, regardless of the APR.. so if I have two CC accounts, $12000 at 26% and $6000 at 8%, why again to I want to pay off the cheaper money first?

You can do all the figuring, it really doesn't amount to much. I have a 24% CC which is my largest balance. I have several other debts that are all smaller as well as much less interest. I have an excel sheet budget per paycheck (every Friday) that can tell me from now until eternity, depending on how much I copy/paste the years, how bills are being paid and what the minimum payments on debt is. It also tells me how much I have left over and I can see what happens to the debt as I apply that "snowball" to debt. By paying my 0% interest smallest first, then moving through the smallest to largest until I get to the highest interest, the difference in payoff is a mere 2 months.

The idea is to have victories along the way to motivate you further. I'll be much more motivated to have 2 of the smallest debts paid off in the summer and the 3rd in a year rather than having the largest interest debt only paid of in a year and a half to two years as the first payoff.