Dave Ramsey on dvc

[bumbershoot]

He said he doesn’t recommend any timeshare but he said Disney timeshare is a whole another class of timeshare

How interesting.

Apparently he's some god to some people that got wealthy teaching others how to get wealthy by teaching them common sense and charging them big bucks for it.

?

He helps a lot of normal people get out of debt and get into a better life.

He’s also a jerk that I wouldn’t want to be friends with. But he helped me and my then husband get our heads above water (just after taking on a loan to buy DVC).

We don’t do car loans because of his show. Even when the dealership tries to force you into a car loan to get a “discount.” Fools game

I know plenty of people who negotiate for a loan to a point lower than they would have taken for cash, get the car, and the next week pay off the loan. They’ve spent less than they wpuld I’d they didn’t get the loan.

My sibling gets 0% car loans and uses the cash to invest and earn more than that

Haven’t and never will allow our children to take out any student loans.

So when they are adults you won’t *allow* it? Aren’t you concerned with disfunction in grown children?

I love how he points out that the majority of CEOs went to state schools

I would need to see some stats on that.

I also love how he says young adults should move out of their parents’ homes. Totally agree on that. Leads to dysfunction.

You know that’s that’s a cultural norm in many countries, yes?

I loved the year I spent with my mom and her husband after grad school. It let me get to know her on a really amazing level that I wouldn’t have gotten otherwise. She died less than 5 years later, just after I turned 30, so I’m so glad I got to spend that time with her.

When you do not use debt you lead a very different life and you end up wealthy in the end.

Hmm. Just *not using debt* doesn’t lead to wealth. And using debt, but not getting out of control, doesn’t lead to utter ruin.

the debt snowball method is generally effective. The small victories give debtors motivation.

Yep. It works on an emotional level to keep it rolling.

Of course the avalanche saves money. But it’s not as rewarding as quickly, so people often run out of steam and don’t finish it. Plus, if we were at math, we wouldn’t have gotten out of control to begin with. Let’s not start pretending that we know financial math now lol.

As I say elsewhere, pick one (snowball or avalanche) and DO IT. If you find that you hate what you chose, change, and DO IT.

He's better than nothing and if someone is completely lost he might be a good start.

Absolutely.

My mom had no time to teach me anything about money. She was too busy keeping food on the table. It wasn’t until the stepdad, which was after I was in college, that she had breathing room. My sibling was still on HS and got to learn from the stepdad. He’s much much better with money than I am. He also made mix better career choices (and his wife made an even better one).

But for someone like me, or for my then husband whose dad was a financial disaster that came from a long line of financial disasters, Ramsey helped a lot.

That is commonly referred to as the "debt avalanche."

Yep.

 

[IdahoDisneyFan]

We did Dave Ramsey's Financial Peace University online over a decade ago. Cost us $99. Best money we ever spent. HUGE benefit to our finances and our marriage. We have virtually zero fights/disagreements over money. We were both college educated, in my case that included grad school. Despite that, we both grew up in homes where common-sense financial wisdom was not passed on. We were/are both reasonably intelligent people but had no common sense about money. For example, like the majority of Americans we thought having a car loan was "normal." Thankfully we haven't hard a car loan in over 10 years, and are certainly thankful right now that we're not paying interest on the cars sitting in the garage most of the day.

Ultimately, what I appreciated about his program was the motivation and hope that came from having a concrete plan to implement. I think the vast majority of his advice is timeless. He's not generally reinventing the wheel, but has a fully fleshed out program that's understandable and easy to follow.

From my perspective Dave Ramsey offers advice that works well for a large percentage of people, so for the most part that advice has to be broad and consistent, and not targeted to each individual's circumstances. Thus he has hard and fast rules that he preaches. Are there aspects of it that one may disagree with or doesn't apply to them? Probably, but personally I've never met anyone that I agree with on all topics 100% of the time.

We eventually quit using the cash-only envelope system after we were pretty solid with our budget. Mostly I got tired of the relative inconvenience of it. That said, I will freely admit I think we spend more using our credit card. It's a lot harder to hand over cold hard cash. A cash-only Disney trip would be real kick in the gut. Ha ha. We never run a balance and we like earning rewards points for flights, etc, but I agree with the philosophy that swiping a card is a lot more mindless and a far easier way to blow $$$.

My attitude about DVC is, thus far in its history, it has far fewer downsides than a traditional timeshare. That said, I'm not surprised Dave Ramsey might not be a fan. A lot of his advice is about helping you sleep better at night (seriously), and every additional financial obligation has the potential to impact one's sense of financial wellbeing (car payments, credit card debt, maintenance fees, etc, etc). I'm not down on DVC owners by any means. If you've financially stable, can afford it, and it makes you happy, have at it. I think where I always get hung up when I consider buying into DVC is that I would never take on debt to buy in, so I would only consider it if I had enough cash on hand for a very substantial contract at the better resorts. But if I had that kind of a cash laying around, I'd rather avoid the hassle of having to reserve WAY in advance and be able to book when and where I want (albeit at typically higher rates). Plus, if/when life circumstances change overnight (ala Covid19) I don't have to worry about eating points and/or having to sell a contract in short order. But again, I don't have an issue with people who think it's worth it.

There are of course other great financial experts out there, Dave Ramsey is just one of the more well-known. I would not hesitate to recommend picking up a book or checking out a Financial Peace program for anyone who's worried about finances, in debt, or needs some motivation to make smarter money choices. Take what you like, leave the rest.

 

[heynowirv]

I don't know him either. But we do carry a car loan 0% on a loan on my DW's VW that is just about ending, and now I need a new car and going to buy a Mazda also at 0% interest. We do use our CC's instead of cash and those rewards without carrying any debt from them. We are not rich but common sense is just that common sense.

 

[Sandisw]

I worked hard, enjoyed life, sometimes used credit, have always financed or leased cars, saved money, and spent money for yearly vacations for our families, mostly for WDW,

We paid for catholic school tuition for all 3 kids and helped with college as much as possible, but all took out loans and incurred debt. We continue to help them with those loans.

All and all, I am sure I’d fail his course, based on how much spent on DVC and other things,

But, I raised Wonderful and responsible children, will have comfortable life in retirement and am just happy.

Everyone makes different choices. Timeshares are not for everyone that is for sure!

 

[Grumpy by Birth]

... and helped sith college as much as possible,

 

[Eric Smith]

View attachment 491520

There’s no way Palpatine didn’t use debt to finance those Death Stars.

 

[Memorymakerfor4]

We used Dave's advice to get out of debt when we graduated and got married. It worked beautifully. We had no grounding from family in this area and needed somewhere to start. The most amazing thing is that we do not fight about money. I'll admit we have relaxed a little from his rules in that we started using credit cards a few years ago, but that was after a decade of living the cash life, and you better believe those monthly balances get paid. We also bought a new car (another no no). We feel like we paid our dues being careful for so many years, and are now starting to enjoy some nicer things without the burden.

Most timeshares are money traps, which is why he advises against them. We have friends who bought one in Vegas, but can never get a room during their reservation week. They've paid for it for 8 years and haven't stayed once. I think if you could talk to Dave about DVC and how it's different, he'd still be against it. He has made a plan with broad appeal and does not want you to be chained to anyone. Despite the fact that we paid cash, have budgeted for dues, checked all the other "responsible" boxes, he's not wrong that we are chained to DVC until our contract expires or we sell. He will never advocate for that.

 

[J and R's mom]

Dave says don’t buy a stupid timeshare. Bad people selling a bad product. He said he doesn’t recommend any timeshare but he said Disney timeshare is a whole another class of timeshare. He doesn’t have it or any timeshare but talks good of Disney.

I regularly hear a commercial on a local morning radio program and it is to help people get out of their timeshare. However, the reasons the commercial touts for getting out of timeshares (no time limit so stuck with it indefinitely, no cap on annual dues increases, stuck with same vacation spot for years, etc.,) does not apply to DVC contracts. So I can see why Dave (and any of his ilk) would put DVC in a category of its own. It seems even he can see the value of owning DVC if the purchaser plans on Disney vacations for decades to come (which most of us do or we would not own DVC contracts). And he probably sees that historically DVC timeshare values actually appreciate over time in the re-sale market...which I hear is also unheard of for most timeshares.

Glad that Dave could see that too.

 

[CanadaDisney05]

We eventually quit using the cash-only envelope system after we were pretty solid with our budget. Mostly I got tired of the relative inconvenience of it. That said, I will freely admit I think we spend more using our credit card. It's a lot harder to hand over cold hard cash. A cash-only Disney trip would be real kick in the gut. Ha ha. We never run a balance and we like earning rewards points for flights, etc, but I agree with the philosophy that swiping a card is a lot more mindless and a far easier way to blow $$$.

Tip of the day.... I use an online software called YNAB. It is essentially the "envelope" method of budgeting, but digitized, and essentially zero hassle. I'm a firm believer in the method, but would never have the patience to actually implement it if I was literally taking cash and putting it in physical envelopes. I'd also be nervous as hell that I'd get robbed blind.

 

[cruisehopeful]

Tip of the day.... I use an online software called YNAB. It is essentially the "envelope" method of budgeting, but digitized, and essentially zero hassle. I'm a firm believer in the method, but would never have the patience to actually implement it if I was literally taking cash and putting it in physical envelopes. I'd also be nervous as hell that I'd get robbed blind.

That's exactly what I did. Dave Ramsey teaches the envelope system, which is great for people without any self control - such as my husband. I started using YNAB almost immediately after taking Financial Peace, mostly because I wanted to use credit cards and pay them off every month so that I could reap the benefits of all the cash back bonuses, etc.

Dave Ramsey said in the course, Financial Peace, that 95% of people who buy anything on special financing such as 0% for 6 months, never pay off their purchase in the 6 months. I was blown away by that and my husband said to me that I'm the only person he know who pays off stuff during the intro period of the free interest. I just couldn't wrap my head around it that so many people would buy something on those terms, planning to pay it off and then not doing it. The way people see/use/abuse money is all so different. For me, YNAB works perfectly. My husband can't do YNAB to save his life, so I put a category in there for that and I actually budget money for him to spend and not remember what he spent it on.

 

[Grumpy by Birth]

My husband can't do YNAB to save his life, so I put a category in there for that and I actually budget money for him to spend and not remember what he spent it on.

Does he have to get a gold star on a chore chart to earn his allowance?

 

[AKVHutch]

For us Dave's debt management was pretty much what we were doing so it was positive reinforcement. Mostly agree with him, but find him humorous when he goes on a rant. I listen to his show occasionally just to hear how screwed up personal finances can get.

Good to hear he doesn't think DVC stinks. I have also heard other investment and time share haters say that Disney is the only time share with a decent contract. I believe it is because there is an "end date". Personally we did a lot of research into time shares and found that Disney was the only one we would consider because of ease of use and a known end to the contract.

 

[SteveH]

I've always wondered what he'd think of DVC. Between this and the past one I still don't know if he fully understands DVC.

Dave Ramsey isn't a bad guy, anyone that helps people to understand their choices and finances is win in my book. Back a few years ago Clark Howard was the cheapskate finance guy, the and Dave differed in the Clark said pay of your high interest first and Dave said pay off your smallest first. Who cares just focus on paying off your debt.

I did pay to have two staff team members go through FPU, both of them thanked me and changed their spending habits. I saw a dramatic change in both of them, and as a business it also meant I was less likely to run into possible problems down the road if they didn't change their ways.

The difference is that Dave hates banks, cars, well just about anything. The radio sales guys hate Dave Ramsey, try selling air time to a business that Dave turn around and trash it.

 

[AvidDisReader]

I read Dave's backstory. He blames banks for forcing him to file Bankruptcy back in the 80's.

 

[Grumpy by Birth]

There’s no way Palpatine didn’t use debt to finance those Death Stars.

Don't even get me started on how much credit card debt he must have racked up building that Final Order fleet on Exegol!

 

[Grumpy by Birth]

Back a few years ago Clark Howard was the cheapskate finance guy, the and Dave differed in the Clark said pay of your high interest first and Dave said pay off your smallest first. Who cares just focus on paying off your debt.

I do remember hearing Clark Howard on the radio years ago as well. As I alluded earlier, my highest interest rates were also my smallest balances in many cases so, in the end, I kind of used both methods simultaneously. But I was more consciously focused on getting rid of the higher interest first because the interest on those debts was the main thing holding me back from making headway.

 

[mustinjourney]

As others have pointed out, we also do not follow his investment advice. It’s ok but just doesn’t resonate with us. I also do not think it is great advice to pause on the 401k. For us retirement savings should be non negotiable from day one, first day you start working. “Kids” need that beaten into their heads. If you start day one, you can retire in your 50s if you live conservatively. That’s real power. But I think part of why he says to pause on the 401k is because he is trying to get people who are out of control to focus on one thing: paying down debt. For some people, debt is making their lives impossible. So I get his reasoning if the pause is only for a couple of years tops.

I read one of his books about ten years ago, and while I don't follow his advice, I believe his advice is appropriate for the vast majority of people. His target audience consists of those that are financially illiterate...which is sadly probably at least 65% of the country.

Credit is way too easy to get and people just can't help themselves.

The 401k vs high credit card interest is any interesting discussion.

 

[mustinjourney]

Don't even get me started on how much credit card he must have racked up building that Final Order fleet on Exegol!

perhaps he believes in modern monetary theory and just straight printed the cash.

 

[CanadaDisney05]

I read one of his books about ten years ago, and while I don't follow his advice, I believe his advice is appropriate for the vast majority of people. His target audience consists of those that are financially illiterate...which is sadly probably at least 65% of the country.

Credit is way too easy to get and people just can't help themselves.

The 401k vs high credit card interest is any interesting discussion.

IMO, I don't think it's really close (unless there is an employer match). Yes, everyone needs retirement savings. But your not going to have much of a retirement if you have ridiculously high levels of debt. At 19.99%+ interest rates on credit cards, you will probably never be able to buy yourself out of debt in retirement.

When your starting to talk about "low interest" debt (<10%), then the discussion becomes more interesting.

IMO, it goes:

1) Emergency Savings
2) Employer sponsored 401K if there is an employer match
3) High Interest Debt
4) 401K/Roth IRA (I think that's what they are called in the US. One is based on pre-tax dollars but provides a tax deduction, and is taxed as income on withdrawal. Other is based on after-tax dollars, no deduction, but income is non-taxable)

 

[mustinjourney]

We eventually quit using the cash-only envelope system after we were pretty solid with our budget. Mostly I got tired of the relative inconvenience of it. That said, I will freely admit I think we spend more using our credit card. It's a lot harder to hand over cold hard cash. A cash-only Disney trip would be real kick in the gut. Ha ha. We never run a balance and we like earning rewards points for flights, etc, but I agree with the philosophy that swiping a card is a lot more mindless and a far easier way to blow $$$.

This is definitely true --- if having to use cash, people spend a LOT less than using credit card. The 1-2.5% in credit card rewards I get definitely do not offset the increased amount of my spend. But I also like that a credit card allows me to review my spending. I know if I use cash, I'm always wondering where the hell it all went.

Plus I have a tendency to lose cash -- I can't tell you how many times cash has fallen out of my pocket b/c I put the change in my pocket instead of my wallet and then it fell out at some point later.