dolly77:

2ndGenGranola:

I don't have my book handy but doesn't he say to put aside each month towards a $1000 min emergency fund?  I don't recall him saying to do it in one swoop.

Yes, the ultimate goal is at least $1000 in an emergency savings fund.  Here is the passage I was referring to in the book, where he assumes most people can save this in month.

"Twist and wring out the budget, work extra hours, sell something, or have a garage sale, but quickly get your $1000.  Most of you should hit this step IN A LESS THAN A MONTH."  pg. 105

I

 Dave has a beans and rice philosophy. If it means get rid of everything you have but a table and enough chairs for everyone in the family, along with beds for sleeping, then the proceeds will get you started on the path to debt-freedom.

thyme2save:

If it means get rid of everything you have but a table and enough chairs for everyone in the family, along with beds for sleeping, then the proceeds will get you started on the path to debt-freedom.

That is assuming people in debt got that way purchasing furniture and other non necessities that have resale value.

What happens for those whose debt was made for necessities not things they can sell? How about those who have lived frugally for years to make it on a small income and live by the wear it out and use it up concepts but now find themselves facing unemployment or even less hours?

I know that for the people who are in these hard spots, the common advice is "get a job" or a "second/third job". That's not always so easily done, especially when there are areas where people are fortunate to have any job, no matter if it covers the bills or not.

The assumptions that everyone in debt must have foolishly spent so just stop spending or work more really do annoy me. It insults and does not help so many in very different situations out there.

 

 

 

 

Dear ALl, I couldn't agree more with Brandy.  As someone who had to commmit bankruptcy due to overwhelming medical bills, I understand that a person can be trying, trying, trying to work to cover bills but get left behind due to circumstances.  If you have overwhelming medicl bills, you geneerally also are disabled as I became.  Medicaid & Medicare eventually paid many ongoing bills once I was eligible for Medicare (some years have to go by after being on Social Security Disbility before being eligible for Medicare), & there is no prohibition on saving for Medicare, but on Medicaid, you can't have more than $2K total in assets, & therefore have every incentive to "spend down" whatever you have.  (People can always set aside some "under themattress," of course.)  Yours in Him, Deb

Brandy:

thyme2save:

If it means get rid of everything you have but a table and enough chairs for everyone in the family, along with beds for sleeping, then the proceeds will get you started on the path to debt-freedom.

That is assuming people in debt got that way purchasing furniture and other non necessities that have resale value.

What happens for those whose debt was made for necessities not things they can sell? How about those who have lived frugally for years to make it on a small income and live by the wear it out and use it up concepts but now find themselves facing unemployment or even less hours?

I know that for the people who are in these hard spots, the common advice is "get a job" or a "second/third job". That's not always so easily done, especially when there are areas where people are fortunate to have any job, no matter if it covers the bills or not.

The assumptions that everyone in debt must have foolishly spent so just stop spending or work more really do annoy me. It insults and does not help so many in very different situations out there.

 

Indeed.  A friend of mine and her husband racked up a high level of debt because her husband's ex-wife managed to get a ruling for child support that exceeded his income. It took them several years of court battles (at a high cost - adding more to their debt) to prove that he could not afford the child support he'd been ordered to pay; in the end, he had to relinquish his parental rights (which is what his ex wanted in the first place) and pay the back-due amount, which took several more years - and during that entire time he had no contact with his kids from his first marriage (part of the court ruling was, unless he paid the amount due, he could have no contact with his kids), who have now been convinced by their mother that their father didn't want to see them... so now they don't want to see him either.  And five years later, they are still paying off the debt they racked up trying to keep up with and then modify the payments.  There's nothing there to return, and I doubt they'd change anything if they could - except to find a way for the husband to maintain contact with his kids, which has no price, but infinite value.

Brandy:

The assumptions that everyone in debt must have foolishly spent so just stop spending or work more really do annoy me. It insults and does not help so many in very different situations out there.

It doesn't take much to be buried in debt anymore. Medical bills and child support can be the undoing in any family. The other thing is that he doesn't seem to address the emotional issues of money, just the hard numbers of a budget. I recall a couple of months ago Gary started a thread about what else we could include to help people budget. One of the things was addressing the emotional aspect of money and why we spend the way we do, And how we feel when the money just isn't there for necessities let alone savings.

Going out on a limb here... I don't think it matters why you are in debt. Dave Ramsey's basic rule is to get you out of debt, and he is saying that you should do whatever is necessary to do that. If you owe $10,000 because of foolishness or because of medical bills, you still owe $10,000 and the way you pay it off (or don't pay it off) is the important message.

If you want to get out of debt, you have to buckle down and do it. Sell what you have, work an extra job, quit spending on anything except the basics. Do whatever it takes legally to get the debt paid off.

Pat:

Going out on a limb here... I don't think it matters why you are in debt. Dave Ramsey's basic rule is to get you out of debt, and he is saying that you should do whatever is necessary to do that. If you owe $10,000 because of foolishness or because of medical bills, you still owe $10,000 and the way you pay it off (or don't pay it off) is the important message.

If you want to get out of debt, you have to buckle down and do it. Sell what you have, work an extra job, quit spending on anything except the basics. Do whatever it takes legally to get the debt paid off.

 Because this was first addressed to me, I think, I want to add that I agree with you, Pat. True, we didn't always cause our debt but may be victims of it; nevertheless, when we are overcome with a mountain of debt, we must get through it if it takes years and years.  

Pat:

Dave Ramsey's basic rule is to get you out of debt, and he is saying that you should do whatever is necessary to do that

I like his steps in finances. Dave is a get out of debt and move on to wealth expert. He leans heavily on shaking his audience into stopping their spending to break their bad cycles. He is great at that and his methods work for those whose desires charged them into debt.

He is not a frugal living expert. He fails to help those whose income levels are not meeting expenses or who have dealt with major and expensive disaster like illness or disability. For people in these situations, cutting up the card is good yes but won't be the end of it. Not eating out or not buying new clothes aren't the tips they need. Clean with baking soda to save another dollar may be what they need to hear but that gets told in places like this, not his book.

 

 

Brandy:

Pat:

Dave Ramsey's basic rule is to get you out of debt, and he is saying that you should do whatever is necessary to do that

I like his steps in finances. Dave is a get out of debt and move on to wealth expert. He leans heavily on shaking his audience into stopping their spending to break their bad cycles. He is great at that and his methods work for those whose desires charged them into debt.

He is not a frugal living expert. He fails to help those whose income levels are not meeting expenses or who have dealt with major and expensive disaster like illness or disability. For people in these situations, cutting up the card is good yes but won't be the end of it. Not eating out or not buying new clothes aren't the tips they need. Clean with baking soda to save another dollar may be what they need to hear but that gets told in places like this, not his book.

 

This is what I was trying to get at as well - I know plenty of people who got into debt through poor financial habits, and Dave Ramsay's program would be good for them if they would do it, but I also know other people (considerably fewer) who had unexpected financial crises such as medical expenses, or my friend's problem with her husband's ex and child support, who need to save money to pay off those crises, who were frugal and making ends meet, but weren't able to save until the crisis hit, or who used up their savings trying to pay off the crisis, and are now struggling to get out from under the debt caused by the crisis - and they have little, if anything, left to cut; they need cost-cutting ideas, not debt management of the type most people need.

karenteacher:

- I know plenty of people who got into debt through poor financial habits, and Dave Ramsay's program would be good for them if they would do it

I have recommended Dave's books to several people. I offered to send my brother my copy of one of them. He definitely needed to hear the habit changing speeches and be told to put the card down.