Is Dave Ramsey’s Financial Peace University Worth It?

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dave ramsey financial peaceRecently, I’ve been reading a lot of Dave Ramsey posts by bloggers.  Some bloggers love him because his course transformed their lives.  Others aren’t nearly as excited about some of axioms that Dave espouses.  

 

I thought I would share my personal experience facilitating the Dave Ramsey Financial Peace University course and give you some of the funny, and not so funny, feedback that I’ve received over the years.  

 

As most of you know, the course includes nine lesson plans.  As you’ll see, I think there is a bunch of fluff in the mix.  

 

Super Saving

Dave Ramsey Financial PeaceThe first lesson plan is really just the introduction to the course.  Dave highlights his seven “baby steps”.  In this lesson, he pumps up the crowd as he tries to get everybody to commit.  Outside of the seven baby steps that he outlines, I personally think he could eliminate this lesson.  There just isn’t much to it other than introductions, which could be condensed greatly.

 

Mrs. Mustard Seed Money comment – Since I’m the editor, I figured I’d throw in my two cents on this.  Personal finance is not my passion, like it is for Rob.  So I can appreciate Dave Ramsey trying to energize the crowd to motivate them to crush debt and take charge of finances.  I understand the psychology behind it, so it doesn’t seem like as much of a waste to me as it does for Rob.

 

Relating with Money

dave ramsey financial peaceThe second lesson plan is all about making sure you and your spouse are on the same page.  If you’re single, this is probably a bit of a waste.  In some ways, if you don’t know how your spouse spends money, you may have bigger issues in your marriage.  

 

Mrs. MSM – I thought this lesson was invaluable.  At first, I had no idea that Rob was a free spender.  He always seems so measured in his spending, but then I noticed he impulsively purchases items when he believes there is an “emergency”.  We still have an unopened leather conditioner for our sofas that he’s never used.  That’s $10 down the drain.

 

Cash Flow Planning

dave ramsey financial peaceCash Flow Planning is really a fancy term for learning how to budget.  This third lesson is the first valuable lesson in my opinion.  For many people, this may be the first time they’ve done a budget.  It’s a great place to start in order to take control of finances.

 

Mrs. MSM –  When I took the course, I had never done a budget.  I grew up in a household where I never heard the word “budget”, so this was my first interaction.  Plus on top of that, Rob had handled all the finances, so I realized I could no longer be blissfully ignorant in that area.

 

Dumping Debt

dave ramsey financial peaceThe fourth lesson is Dumping Debt.  This is when Dave espouses the evil of credit cards, although a lot of bloggers hate his cash-only stance.  Honestly, I’m lukewarm in this area.  Some people really do need to go all cash, so they can feel their hard-earned money leave their wallet.  But with that said, if you responsibly pay off your credit cards, utilize cash back!!!

 

Mrs. MSM – I had never really considered the psychology behind paying in cash vs. paying with credit card.  It makes complete sense, although we still predominantly use credit cards in our home for tracking and cash back purposes.

 

Buyer Beware

dave ramsey financial peaceThe fifth lesson is Buyer Beware.  Dave demonstrates how marketing influences you and how companies suck you in.  I’m not saying this is bad to recognize, but I’m not sure it’s worth spending an hour on.

 

Mrs. MSM – My favorite part of this lesson plan was humming along to some of the slogans that Dave sang.  Entertaining, but not terribly useful in my opinion.

 

The Role of Insurance

dave ramsey financial peaceThe sixth lesson is The Role of Insurance.  I can honestly say this is the only reason that I signed up for FPU in the first place.  I wanted to learn more because at the time, I had no idea how much and which insurances I needed.  With that said, there are some insurances that I disagree with Dave about and think are a huge waste of money, namely identity insurance.  I haven’t done enough research, but at first glance, it seems like overkill.

 

Mrs. MSM – This is the part of the course where I started to glaze over.  Insurance is super boring to me, but Rob was on the edge of his seat as he didn’t want to miss a beat.  So I checked out a little bit since I knew that he was paying attention and would discuss it on the drive home.  I love you, honey!!!

 

Retirement and College Planning

dave ramsey financial peaceThe seventh lesson is Retirement and College Planning.  Disclaimer before I start– this lesson makes my blood boil.  He pushes hard to ignore fees and to buy active mutual funds.  He touts 12% rates of return and really sets false expectations for people.  I don’t know how he can get away with this false advertising.

 

He also pushes Endorsed Local Providers (ELPs), which are essentially Dave-approved financial advisors.  How do you become approved?  From what a financial advisor friend told me, you pay Dave a certain amount and then he includes you in that network.  They’re not necessarily Christians or have any specific background, so I’m really not sure of the vetting process.  My friend also said that Dave’s team pushes the American Fund, which has a front load of 5%.  Most of us know this is probably not how we should be investing.

 

Mrs. MSM – This is Rob’s wheelhouse.  After this video lesson ended, he told everyone in the room to forget what they had heard.  Then he walked them through what they should do instead. It was fun seeing him in his element.  And all of our peers were listening intently to his advice.

 

Real Estate and Mortgages

dave ramsey financial peaceThe eighth lesson is Real Estate and Mortgages.  This is probably the lesson plan that I hear the most push back on in class.  Dave pushes hard to get into a 15-year fixed-rate mortgage.  However, living in the DC area, a lot of people balk at this and believe it to be unrealistic.  Waiting to afford a 15-year fixed-rate mortgage for some might result in them never being able to afford a house.  As someone who obtained a 15-year fixed-rate mortgage and paid off my mortgage early, I know it’s doable, but I definitely understand the consternation.  

 

Mrs. MSM – Growing up, my family was searching for the perfect home for years.  We had outgrown our current one at the time, so every weekend we’d visit open houses in search of our future home.  So real estate has always been something interesting to me.  I enjoyed listening to most of this lesson, although anytime I hear about real estate from someone who is not based in our area, I do take their information with a grain of salt.  

 

The Great Misunderstanding

dave ramsey financial peaceThe ninth and final lesson is The Great Misunderstanding.  This is basically a rah-rah speech at the end when Dave tells you to go out and execute on the previous lessons and take the appropriate baby steps.  

 

Mrs. MSM – I liked this lesson because it talked about purpose.  I saw how it all tied together and the impact that I could have on my community by being debt-free and financially secure.  It was inspiring.

 

My Bottom Line

So honestly, I believe that all 9 lessons could easily be condensed into 3-4 lessons.  In my opinion, more than a month of classes is a bit much.  I think that’s part of the reason why so many people drop out during the course.

 

Mrs. MSM – I agree to an extent that the course feels drawn out.  The one benefit of it though is that it allows people to digest a small amount of information at a time to allow the habits to take effect.  With that said, I won’t interject anymore since the following is his experience in the class.  Mrs. MSM… signing off.

 

My Experiences Facilitating the Course

Normally a course starts out with around 40 people.  By the end, we’re lucky to have about 20 people left.  Over the years, we’ve tried to figure it out whether it’s because people don’t want to do the work because it’s too overwhelming or whether it’s because people don’t agree with the principles.

 

dave ramsey financial peaceA couple once came up to me and acknowledged that they were in a lot of debt.  But since they disagreed with Dave’s philosophy, they decided to follow their own path.  The husband was convinced he was the smartest guy in the room.  He touted buying cars and furniture at 0% down, believing he was really gaming the system.  I remember thinking he was definitely savvy in the short-term, but he didn’t have any savings for retirement.

 

Why Would I Teach It?

So I know it sounds like I have a lot of issues with Dave Ramsey’s curriculum.  That is correct.  My wife has even asked me if I disagree with the lessons plans so much why would I help facilitate the course.  It’s because I have the ability to directly influence people’s finances after Dave is finished talking.  

 

dave ramsey financial peaceThe set up is typically an hour of Dave talking and then 30 minutes to discuss the lesson afterwards.  Most of the people I know have a hard time focusing for an hour straight with Dave, but they are much more attentive in a shorter group setting.  At that time, I have the ability to “correct” some things that I hear or discuss financial concerns of those in the group.

 

I especially love addressing the Retirement section.  His investment advice, as I described above, is absolutely terrible.  So, I try to re-educate the class about passive index funds and how fees actually matter.

 

Great Conversations

dave ramsey financial peaceOn top of that, I have had so many awesome and funny conversations through these group discussions.  

 

I was once was talking to a woman about cutting back on eating out so that she could tackle more of her debt.  She adamantly replied, “No way, that’s my entertainment budget.  I’d rather sell my car and ride the bus to work everyday than give up eating out with friends.”

 

I laughed.  I personally love the freedom that owning a car grants me.  But it just goes to show how different people value different expenditures.

 

Updates & Feedback

dave ramsey financial peaceAt church, people pull me aside after they’ve taken the class to share how they’re doing and their current financial journey.  It’s always exciting to hear their updates and receive feedback.  A lot of times, these individuals will also ask me for advice in their current situation, and I try my best to guide them in the right direction.

 

Impacting My Community

In conclusion, the main reason I teach the course is because I feel like this is my way to give back and make the biggest impact in my local community.  Of course, I would love to condense the course and teach certain things differently.  Now I just need some time to create my own, modified course 😉

So readers, what is your experience with Dave Ramsey?  Do you lean more towards me or Mrs. MSM with your experience?  Share your thoughts below.  

Mustard Seed Money

Welcome to the website. A mustard seed is a very small seed but astonishingly grows very large over time. My hope is that through your financial journey that your small investment in time, money and faith will grow beyond anything that you could ever imagine.

76 Comments

  1. I love the his-and-hers perspective…and I agree a lot with the Mrs. Dave’s huge value is in getting people *excited* enough to actually try things, when most of them are wrapped in the financial principles of the world. And that requires stretching it out some–though maybe not through all of those lessons, I agree. He’s not just giving people basic wisdom, he’s fighting an entire culture that’s geared *so strongly* against basic financial wisdom.

    I agree with you about the portions of the course that need change, especially retirement/college piece (I remember thinking how ambitious 12% was!). But I *really* like how intense Dave is about debt: you’re among the 2% of Americans who don’t do debt and live frugally by habit/design. Most people, though, seem to have an immensely difficult time breaking free of debt without switching to cash–at least until they really change their habits. And he’s dead on about the psychology of it: even I found myself spending slightly more when I used credit rather than cash (at least until we went *very* frugal, as we are now!). So, like you, I use credit cards again now, but only after switching habits (and I never was a big credit spender or paid any fees) and knowing that I’m frugal by habit.

    It’s fantastic that you’re teaching it and following up with your own wisdom; that’s ideal. (For background: I took the course, learned a lot, and was trained to teach it, but then moved, so I haven’t yet taught Dave’s class, but I’ve taught and worked through such things in another form.) I’m hoping to start up teaching again next year after clearing some current obligations for the same reason as you: to influence peoples’ finances. Another thought: it would be fun if you could teach an FPU 2.0 or such for those who want to *really* do well. I’d love to do something like that one day. (You can’t label it an “FI” course, probably, but that’s basically what it would be…)
    Finances with Purpose recently posted…Our first financial update: starting at the beginningMy Profile

    • I would love to be able to teach an FPU 2.0. I’d love to condense the course and talk a little bit more about FIRE 🙂 Now if only I had more time during the day so I could sit down and really think this through 🙂

      • I listen to the Dave Ramsey show often and has always wondered what it’s like to attend FPU. You provide such a great perspective on the course. I’ve never taken it before.
        I also live in the DC area and totally agree with you that it’s a bit unrealistic to be so obsessed with the 15 year mortgage. But I think the majority of places in the US are much cheaper than DC, so maybe it’s not all that bad that he’s pushing such a plan. Ultimately, it’s for people’s own good to avoid paying a high interest rate every month.
        Ms. Frugal Asian Finance recently posted…Why I Don’t Plan to Be A Stay-At-Home MomMy Profile

        • I think if you can follow Dave’s advice and get a 15 year mortgage that it’s a no brainer. If you can’t though, I hope it doesn’t hold people back from buying a house if it makes financial sense for them. I like to think Dave’s advice as a guideline not commandments 🙂

  2. I guess I’m not cynical enough to have spotted the BS in his financial adviser network. When I read the book and came to that part, I just chalked our differences up to him being ‘not so smart’. Hey, just cuz I’m not cynical, doesn’t mean I don’t get cocky :). But you’re right to have your blood boil- the situation does raise questions.

    Good review overall. And hi, Mrs MSM!
    Daniel Palmer recently posted…What Kind of Debt Are You Marrying?My Profile

  3. Honestly pf bloggers comments on Dave are really my only exposure. That being said if you ignore the investing advice and identity theft insurance, based on your post, I don’t think Daves far off what I would give for super generic advice to a large room of probably non financial focused people. Your wife is his target audience, not you, and her editor notes here show it’s effective to some degree to that audience. Honestly I feel pf is so personal that the discussion session almost like a bible study, are infinitely more valuable. Inevitably someone will have a personal question that needs answering to help them bridge that gap.
    FullTimeFinance recently posted…The Personal Finance Word GameMy Profile

    • Thanks for sharing Full Time Finance!!! I can’t tell you the number of times that people have come up to me for affirmation on their situation. Most of them know what they need to do and they understand what Dave is teaching. But they like having that touch point with a person to really hammer it home. That’s the area that I really enjoy 🙂

  4. I’ve never read or seen any the stuff by Dave – this is probably the most detail I have ever seen! Great to hear both sides, but sounds a little bit of a rara from Dave maybe to pump up his business who knows – but even if only 1 couple take 1 piece of advice away it has to help with the spreading the good word of sensible financial management I guess!
    Cheers,
    FiL
    FIREin’ London recently posted…March ’17 PerformanceMy Profile

    • Wow I thought everyone had read or heard from Dave at this point 🙂 I’m just kidding!!! He definitely is a high energy guy selling his perspective. I think he draws in a lot of the people that are not nearly as excited about finances into buying in.

  5. Great post I’m with finances on purpose. I like the narrative of you and your wife. Very cool that you taught the course. I would like to do it, it’s always nice helping and teaching people about finances. Unfortunately the banks are slanted in their favour and people just believe what they say and get taken advantage of.
    Dave definally changed our lives, I got sick of working so much and really not having much saved up. I drank the juice and listened to his podcasts all the time. Still do, his millionaire theme hour are my favorites. I just finished reading Chris HoGans retire inspired, as much as I enjoyed it it’s the same rederict as Dave’s. Mutual funds etc. I think his debt snowball is fantastic but like you said mutual funds and 15 yr mortgages are unrealistic especially here. In the last year houses in the greater toronto area went up about 30%. You keep saving and your screwed. He has a great job and is definally helping alot of people. Props for that!
    Passivecanadianincome recently posted…April 2017 – Stock PicksMy Profile

    • As a Californian I can second that 15 year mortgages are largely unrealistic in certain geographic areas. I am putting a pretty aggressive amount of money towards the principle to have it paid off early, but 15 years would have been beyond the pale.

      We started with a 40, but through fiscal aggression it will be paid off after 25 years. On the upside, at least we have an awesome geo arbitrage option if we need it. Just cash out of California and I can get the same house for 1/2 the price.
      Jack Catchem recently posted…United Airlines Cop: Do You Prefer $800 or your “everything” injured?My Profile

      • That is so true. Housing in California from what I’ve read is insane!!! You can definitely geo arbitrage somewhere else to fund your retirement and live in a huge house 🙂

    • I would love to have Dave’s job in the future although I have a feeling that he is positioning Rachel for the job at this point. I’d love to have the impact that Dave does with updated information 🙂 So watch out Dave I’m coming to challenge you!!!

  6. I read Total Money Makeover, even though when I read it I was in an OK financial place. I think the only thing I’d do differently than Dave is debt avalanche vs debt snowball. I hate the idea of high interest! I think if you are in a lot of financial trouble, it “pays” to do your due diligence and research whatever learning method feels comfortable with you, but there will always be people who never just want to do the hard work. They want someone to rescue them. There is no course for that!
    Tonya@Budget and the Beach recently posted…Finding Your Why in Financial IndependenceMy Profile

    • Thanks for sharing Tonya!!! I read Total Money Makeover as well. Like you I thought it was good with a couple of small differences that are easy to overcome with a little bit of research 🙂

    • With as much as you read Erik I’m shocked that you haven’t read too much of Dave’s work 🙂

      I definitely agree that Dave likes to keep it a little higher than I cared for but I’m sure it was perfect for others 🙂

  7. This may be my favorite post on this site. I love that Mrs. MSM’s chimed in.
    I’ve read Total Money Makeover, and I thought there was a lot of useful stuff in it. But when I read it, we had already paid off all but our mortgage debt and had our investment philosophy in place. I did send a copy to my brother, who struggles tremendously with controlling his money.
    I haven’t done Financial Peace, though my Dad just went through it and he thought it was very useful. I’ll mention the thing about the advisors to him…he’s had a lot of bad advisors, and Jon and I have been trying for years to get him into Vanguard without much luck. On the other hand, at this point, he’s pretty cynical about financial advisors.
    Emily Jividen recently posted…Taming The Want ListMy Profile

  8. Interesting! I know my in-laws took the Dave Ramsey course and they swear by it. I don’t have much of a problem with the course if it helps people and they find it useful.

    I don’t agree with everything the man says at all, but I’ve used things like his debt payoff method and the envelope system. I think it’s perfectly fine to use parts of Dave’s plan to come up with something that works for you. You have to be willing to put your ego aside and try new things.
    Mrs. Picky Pincher recently posted…What’s your biggest money challenge?My Profile

    • I definitely agree with you Mrs. Picky Pincher!!! Pick up the best tips from others that works for you 🙂 Even Dave says that what he’s teaching has been around forever. He’s not teaching anything new as much as he’s packaging it in a pretty package 🙂

  9. I found this FPU summary fascinating. Total Money Makeover was probably one of the first personal finance books I read and it didn’t really resonate with me as much as it seems to with others. I feel like he has an “us versus them” mentality where he doesn’t acknowledge that there are many good ways to do things (like credit cards are fine for some and not for others). I love that you told everyone to ignore his advice on the retirement funds, lol.
    Making Your Money Matter recently posted…Part II: Ways To Use Loan Amortization Schedules in Your Financial PlanMy Profile

    • I had to build up some trust with the head facilitator before I was allowed to jump in like that. But now he ends the video and says ok, now it’s time to turn it over to Rob so he can refute a couple of points 🙂

  10. One thing I can speak to is Identity Theft. In the last decade since becoming a cop there has been an EXPLOSION of identity theft. Credit cards, checks, bank, and retirement accounts. You aren’t nearly as likely to be robbed, but your account is very likely to be raided depending on where you shop and how free you are with your personal information. I’ve been both victim and investigator on these cases.

    The good news is banks are doing a lot to keep the negative aspects from hitting their customers. If you promptly report it, they refund the money to your account and accept the loss themselves.

    As long as you have a decent bank, you don’t need the insurance, but if you value your credit it’s worth it to get some basic monitoring so you will know if someone opens an account in your name. Especially if you’ve ever worked for the federal government. Thanks OPM.
    Jack Catchem recently posted…United Airlines Cop: Do You Prefer $800 or your “everything” injured?My Profile

    • Hahaha…the OPM breach definitely was not good 🙁 My bank has done a really good job letting me know if someone is trying to do identity theft and I monitor my credit report every year. So far so good 🙂

  11. I also disagree with his mortgage advice. The “all debt is bad” rule is too simplistic.

    I love debt and think it is a powerful tool for building wealth through rental properties. I don’t think storing your money as equity in your home is particularly efficient or wise. For people in Money 101, sure, but if you are capable of saving money on your own and trying to figure out the best things to do with it, I wouldn’t recommend someone like Dave Ramsey.

    • I think debt is a tool like anything else. If used correctly you can make massive gains. If used incorrectly you can get burned very badly. Unfortunately I have seen too many people that use it incorrectly compared to yourself that are really doing big things!!!

  12. I became exposed to Dave Ramsey last year after paying off my student loan debt and really getting serious about our financial future. Before then, honestly, I’d never heard of the guy. I find him to be spot on in a lot of areas, and listening to his podcasts really got me motivated to make changes in my own financial life. But, I agree with you in that there are many pieces to what he teaches that don’t make sense or aren’t very practical. I have thought about taking Financial Peace University myself just to see what it was all about. I have read the Total Money Makeover which I assume is close to what the class is teaching. I’d love the opportunity to lead a group, but I’m thinking perhaps just starting an informal local Meetup group in my area may be a better alternative.

    I do agree with Ramsey on many of the behavioral aspects he pushes. Everyone is different, and perhaps an all cash system is perfect for someone that admittedly has little will power, or an addiction to shopping or spending, or just wanting to not have the temptation at all. With that said, like you mentioned, if you pay your card off every month, the cash back, or travel rewards is like free $$$. My Venture card has given me quite a bit back over the last few years!

    Where I have issue is the message of the consistent 12% return as you mentioned, and this notion of “if you want to start a business or make passive income via owning real estate, save up and pay for it in cash.” I don’t know about you, but if I decide I want to buy a rental property or a business and pay cash, it would take me quite some time to do that.

    In all I think most of his messages are good and he has some great points on crushing and eliminating debt. But beyond that my viewpoint differs on some things.
    Chad @ Finding Your Financial Balance recently posted…My Road to Financial FreedomMy Profile

    • I definitely agree he keeps it pretty high level. If you can get the 1% rule for a rental property that yields over 12% a year for a paltry cost of 4% in debt. Seems like a no brainer to me to take out the mortgage. Where as Dave would hate that type of thinking.

  13. As Dave always says, you have to think and understand, before you start putting your money into something. And this is one of the biggest problem for a lot of people. They blindly follow Dave’s advice about retirement, or ELPs without thinking and researching.

    But anyway, he has helped more people to get out of debt, and he’s changed a lot of lives and families. No matter what he or somebody else says, we need to think and question first, and only after that we can take an action.

    • Thanks for stopping by Friendly Russian!!! I definitely agree that we need to get educated so that we can ask the good questions. I think blindly following will get you in too much trouble. Even if it’s Dave who theoretically you should trust.

  14. I love the point, counter point by the Mrs. Dave was one of the first resources I found when looking to clean up our debt. He’s baby steps were amazing for me as a starting point. He lays out a great easy to use and understand system for someone just beginning to take control of their money.
    Over time as you improve you knowledge on the topic you will stray from his teachings. It’s all about find the balance that works best for your personal situation. Why do you think they call it PERSONAL finance. The one thing I don’t think you can overall is the real examples he used, the Debt Free Screams. They are super motivating to hear. To know others are in the same or similar situation as you and they were able to overcome it give you hope. I was proud to be on his show and with my family do our debt free scream.
    Brian recently posted…Interview Series: Less Debt More WineMy Profile

  15. I think Dave’s Plan is a great place to start and think that class 10 should be discussing JL Collins’s Simple Path to Wealth or Bogleheads.
    I’ve read most of Dave’s books but haven’t attended FPU, and while it isn’t very sophisticated, that’s intentional. It’s meant to be accessible to everyone and it does a good job of getting people out of debt. My hope is that people don’t stop there.
    ChooseBetterLife recently posted…ChooseBetterLife One Year Blogiversary EditionMy Profile

  16. Love what you did with the Mr. and Mrs. point of view! Have never really followed Dave’s plan. I agree with some of the other points above, I think with some of the finance blogs that are out there today, you can probably find the same, if not more information out there on the same topics that are covered in his class. The benefit of looking around some of the finance blogs that are out there is that you may find certain posts and situations that you can directly relate to where as it sounds like Dave’s plan is done at a higher level.

    Really like how its a way for you to give back to your community though. Would you consider teaching a similar course using content or information from your blog?
    Courtney @ Your Average Dough recently posted…Guest Post: How to Beat Passive Dividend InvestingMy Profile

    • I would probably create some new content along with some information from my blog. I feel like I have weaved enough info from the beginning that I probably have a nice outline of what to share. I’d probably need to beef up the content to really make it worth someone’s time 🙂

  17. For me, I have never attended any of Dave Ramsey’s courses or read any of his books. Based on your feedback, I would definitely object to the notion of ignoring mutual fund fees or just strictly using cash for purchases.

    In my opinion, to optimize our finance, we should investigate all methods and find the ones that can provide us with the most potential to build our wealth.

    Thumbs up to you for taking charge to interject your own philosophy. Can’t be a great teacher if you don’t provide your own two cents on the topic.
    Leo T. Ly @ isaved5k.com recently posted…How I Saved An Extra $200,000 By Increasing My DebtMy Profile

    • Thanks for stopping by Leo!!! I definitely like the freedom that the instructor has given me to interject some of my own beliefs in the course. They obviously coincide with the main facilitators otherwise I’d never be able to teach the course 🙂

  18. Very cool to get the Mrs. Involved. I loved that.
    We went through the course with our friends at church and it was great to bring up a difficult topic into the open. I think the course is great for that.
    Also, if someone has basically no financial knowledge it’s a great gateway drug to personal finance.
    It was also awesome that you shot down Dave’s investing advice. I still don’t know why he sells that bill of goods.

    Tom @ HIP

    • Thanks for stopping by Tom!!! I definitely think the best part is the conversations after the course. It’s nice to hear that other people are in the same boat and hearing how other people made the jump to where they are today!!!

  19. This is fascinating. I have been listening to Dave’s podcast for the past few months – before that I had never heard of him! I’m not in debt but love to hear him speak to those who are. I wondered how the actual FPU courses were broke down and the number of people who graduate. Thanks for giving us a peek inside!
    Miss Mazuma recently posted…2017 1st Qtr Net Worth & Savings Rates…Homerun!!My Profile

  20. Hey Mr. & Mrs. MSM,

    Great article! I was not aware of Ramsey’s nine steps. I read a book of his a few years ago that laid out six steps. The first three included building an emergency fund, snowballing all debt, and then building six to twelve months of expenses. After that, his recommendation for creating wealth was mutual funds, insurance, and paying off house.

    I coach people on the first three steps. However, I disagree with the last three. Over a long period of time, one can create a nice nest egg by saving heavily and investing. The problem is that you are not truly creating a cash-generating asset that can produce generational wealth. Ramsey doesn’t follow his own last three steps. He has major cash assets in the form of books, seminars, radio, businesses, etc. These assets produce enough cash flow that total financial independence is all but guaranteed to multiple generations of his heirs.

    I think people starting out should get out of debt, develop a budget, and building a safety net. Wealth is created through ownership. Time is created through duplication of assets.

    Holden
    Holden Alexander recently posted…An Introduction to ‘The Capital Clone’My Profile

    • Thanks for stopping by Holden!!! I definitely agree that content creation is a huge way to multiple your wealth. That’s one of the reasons I started a blog 🙂 Hopefully one day it will pay off!!!

  21. I think Dave’s heart is in the right place but his advice is far from perfect. I have a feeling that since he became hugely popular, he was “encouraged” to advise people in certain directions. I’ll scratch your back if you scratch mine type of thing. But fundamentally a lot of what he teaches is helpful to the people who have no clue. I also enjoyed your wife’s addition to the post!
    Mr Defined Sight recently posted…Easter Weekend and the Candy IndustryMy Profile

    • I definitely am not a huge fan of all his advice. I definitely don’t like that he’s getting a kick back from the ELPs. Seems like he should push passive index funds and get a promotion deal with Vanguard 🙂

  22. I started following Dave in December. The only debt I have is my mortgage and listening to the podcasts motivate me to stick to my budget (I’m trying to pay it down faster). I agree with you regarding the RoR he uses (a bit high) and the idea of paying additional fees in investing–I’m a total Vanguard girl myself. Interestingly, his approach–pick a couple funds that cover different chunks of the market–is one that I learned in a personal financial management class a few years back, and it serves me well. His approach also gives me some ideas for how to reach people in my work as a volunteer financial counselor.

    I’m not 100% cash-based but I’ve cut back massively on my credit card use since I started my quest to cut down, and I have to say that it’s helped me to be more aware. At the same time, we don’t have the same programs/ benefits here for credit card use that are available in the States.

    One slight quibble…you mentioned that it isn’t clear that all of the ELP’s are Christian. One can be a financial adviser, and even a good and honest one, even if one is, say, Jewish, Muslim, Sikh, Hindu, atheist, etc. 🙂

    • Thanks for stopping by Gila!!! I appreciate you pointing out the quibble 🙂

      When Dave teaches the Financial Peace University class he is weaves in bible verses and tithing.

      I think a lot of people that take the Financial Peace University course are under the impression that the ELPs are also fellow Christians and are surprised when they don’t have the same religious beliefs since that is something that Dave implies throughout the course.

      But I agree there are many great money managers of various religious and non-religious backgrounds 🙂

  23. I love listening to Dave’s podcasts and think they’ve provided a ton of inspiration for me (debt-free screams are great). We don’t follow his plan to the letter as we do still have some student debt, choosing to save and invest more since interest is so low on the loans. We use credit cards and pay them off every month in full, and don’t really spend more than if we were all cash. Overall I think he genuinely wants to help people get financial peace, but it’s tough to be fully on board with his advice. I wish I’d taken the course or at least read the book after college to get on better footing and pay off debt faster! I like to switch and listen to Clark Howard as I love his perspective on all things financial. Thanks for your honest opinion and that of the Mrs. too!
    Mrs. COD recently posted…FOMO And Our One-Year BlogiversaryMy Profile

    • Thanks for sharing Mrs. COD!!! I definitely wish people in high school listened to Dave before they chose their college. I think it would save a bunch of heartache when they got out of school with huge student loan debts. I think the earlier we can get to people, the better off they will be in the future 🙂

  24. This is fantastic. I have tried to get my wife to take the course, but she is lukewarm. Have you ever talked to other facilitators about these lessons and what other things do they add? Do they agree about condensing the lessons? To bad you can’t be a facilitator at all of the sessions, although Dave might disagree. I do admit, however, the debt free screams can be inspiring.
    Jason recently posted…How To Protect Your Portfolio From a Big Stock Market DeclineMy Profile

    • I have talked to the facilitators before and they have all said they’d love for me to condense it and create a course. The hard part is Dave’s name draws everyone in so he’s got a captivated audience. Maybe one day when I get a little bit more time 🙂

  25. I have a love hate relationship with Dave Ramsey. I love his concepts, but when he gets into the details he loses me. Telling people they can expect 12% returns and withdraw 8% is simply wrong. Pushing people to expensive advisers is also something i don’t agree with. I’m assuming the latter is mostly for financial benefits to him somehow. It’s not really hard to sign up for a vanguard or fidelity account and choose 3-4 Index funds. But generally speaking, if everyone followed his baby steps they would be better off. If you don’t know what to do, just do those steps. He convinced me to pay off my mortgage which i’m working on doing aggressively. I just wish he would clean up some of his details.
    ReachingTheCrest recently posted…How Much Do You Need to Save? Part 2My Profile

    • I definitely agree that Dave does really well on the overall picture but the details are a little off. I’d love for him to clean up the details when he does the next iteration of the course 🙂

  26. I actually haven’t attended his class but I have a few former classmates that have & one actually did the debt-free scream on his show.
    I have read his books & listened to his radio show occassionally when they used to air it on our local radio station.

    Life dieting, it is effective if you strictly follow it & don’t necessarily try to implement other strategies as well. I personally recommend him because he does have a proven long-term record. It’s not a one size fits all approach, but, it gets the job done.
    Josh @MoneyBuffalo recently posted…Rising Your Finances From the DeadMy Profile

    • I definitely agree that Dave’s stuff works if you do it. Although there are certain things that I think he’s off on, 90% of what he says is good stuff 🙂

  27. No direct experience with Dave myself just heard the stories. I believe I would lean more towards your thoughts than Mrs. MSM, but I gotta say I loved her editorial comments. Do you guys do that often? I think it added a nice touch!

  28. Living in europe, chances are slim I’ll ever get to see Dave Ramsey live at work. But I do listen to his podcast and to me they are a real source of motivation. I love hearing those debt free screams!
    And although I am not in agreement with a 100% of his message, I do however believe that if you follow his method, your finances will improve dramatically.

    • I definitely agree with you that the overall concept works great. Especially around debt!!! I just wish some of the investment advice was a little bit stronger at times 🙂

  29. I love Dave Ramsey! With all online influencers, i think its mainly about whose voice speaks to you and that’s how you’ll kniw whonyou should follow. For me, Dave Ramsey’s voice speaks to me. Great article. Love your blog title as well!

    • Thanks for stopping by Ryan!!! I definitely agree that certain people speak to some people better than others 🙂 Dave definitely does a nice job of pulling people in with his simple to follow advice and personable story telling 🙂

  30. Dave is for debt. Use Dave’s approach to clean up your act and get out of debt. Then, after your debt free scream, thank him for his services and immediately move on to better investing advice.

  31. I actually LOL’d when I read the part where rob told everyone in the class to forget the investing lesson and went on a rampage promoting no fee index funds. Haha. If I was in the room, I definitely would have known who the personal finance blogger was! Haha. I also struggle with the 12% mutual fund avertisement. I was at a bonfire last weekend, and I randomly started talking to a young couple who had just finished fpu and wanted to learn more. I went on my own rampage about vanguard and vtsax and said it’s about 7% return on average. They countered and said but that’s not what Dave said to do. He said try to get a 12% return. I felt like I had to re educate them on what real world investing looks like. I’ve never had consumer debt so Dave Ramsey has never been my personal voice of enlightenment, but I do think he is that voice for millions, and those millions he reache’s then become our (bloggers) audiences so I’m grateful that his lessons are making the world a better place.
    Bill @ Wealth Well Done recently posted…God and Success: 6 Tips to Help You Find The Life You SeekMy Profile

    • Thanks for stopping by Bill!!! Sounds like we are re-educating people one couple at a time 🙂

      I too didn’t know much about Dave Ramsey since I didn’t have consumer debt so it wasn’t until my church was teaching FPU did I start to learn about Dave Ramsey.

      As others have said Dave is great for debt not so hot on the other topics.

  32. I don’t get the insistence on a 15 year mortgage. Why not tell people to get the 30 year and then bump up the principle to have it paid off in 15 years? The other benefit is if you hit a rough patch in your life, you can pay the minimum 30 year note until you’re back on your feet, and have less to sweat about when the short term pain cranks up. Am I off my rocker or is it the audience difference between readers of FI sites and Dave followers?

    • Thanks for stopping by Brad!!!

      I think the reason Dave and some in the PF community push 15 year loans is a lot of people will say they will get a 30 year loan and pay it off on the 15 year schedule, but don’t actually follow through.

      I definitely think the audiences are probably different with Dave vs. FI sites. I think Dave does a great job with debt but around most of the other stuff his advice isn’t as well received.

  33. I enjoy listening to Dave mostly to hear about the messes people get into, and think through what I’d do in their shoes. Many people need to hear exactly what he’s saying. The hard part is there are more sophisticated savers and investors who have used credit successfully and he doesn’t really acknowledge the wise use of credit.

    Oh yeah, I agree the expectation of 12% returns are silly, but to be honest a lot of people nowadays think the stock market will never go down, whether it’s 12% or 8% it’s the same assumption that US economic growth is guaranteed over time and market valuations don’t matter. US GDP hasn’t grown by 4% since 2000 so eventually markets will revert to math.
    Rich @ pennyandrich.com recently posted…Penny’s Financial Origin Story: Debt Does Not Equal RegretMy Profile

    • Thanks for stopping by Rich!!! I definitely agree that Dave does a great job when it comes to tough love. It’d just be nice like you said if he acknowledged that other ways work as well 🙂

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