New Book on Dave Ramsey and Suze Orman Reveals Secrets They Don’t Want You to Know

[@oldmanmoto1572]

The biggest thing you can do to ensure an successful retirement is to retire with no debt. All the other stuff these guys teach can be subjective to everyone's specific situation, but if you retire with no debt (including mortgage) you'll be fine.

[@jeffreyRfike]

The biggest thing to remember is that these financial gurus (perhaps even the video creator) are all financially stable, wealthy and independent. People in those positions don't treat, or look at money in the same way as the rest of us, and are frequently, if not usually, overly idealistic and conservative in their specifics. Most have some good "tips", even "rules" but I would not use their overall approach(es) as a plan or even an outline as to how to move forward. I like the idea of looking beyond these pop financial gurus.

[@davidmcknight8201]

But if you're not looking at the hard data, what are you looking at?

[@meljordan220]

We need to find somebody who's been through what we're going through. Someone who can speak to our current situation. Starting there really helped me. I started out with Dave Ramsey listening to his advice and I'm out of debt except my house. Cash flow is better and now I can focus on the next step.

[@jimadams8667]

Good video. I'm also a KZbinr. I have met both Clark and Dave. What's really interesting is that they give opposing advice at times. I tried one of Dave's investor pros and was disappointed. Also, do not agree with his retirement advice. Clark does a great job as a consumer advocate. His financial advice is limited. He does suggest that people consult with an advisor. I've also had poor results related to financial planners. I've found I do better managing my funds myself. I will buy your new book. I read your other one and enjoyed it.

[@DavidMcKnight]

I appreciate your comment!

[@thedirector6274]

What's wrong with Ramit's advice to pay a financial advisor by the hour instead of giving up 1% of your earnings over your lifetime?

[@davidmcknight8201]

The 1% is generally worth it given the studies that show that those who go it alone typically lose 3 to 4% due to irrational behavior during up and down markets.

[@chetanjilhewar1669]

I don’t think there is not wrong with paying the fee based financial advisor but I think they were getting at the more complicated financial plan the more money they need to take control.

[@brucefredrickson9677]

Did I miss comments about Suze Orman as the title suggests?

[@CaliAAA72]

He mentioned her once in a short sentence. Click bait title

[@Bmatorff]

15 years ago I took advice from Dave and cashed in an inherited annuity and retired some higher interest school loan debt. Was a 100k mistake. Take his budgeting system and systematic investing advice but find a professional for the rest. Speaker is correct. He’s good for bad investors.

[@DavidMcKnight]

Thanks for your comment!

[@motoryzen]

Unless I misunderstood you, it's never a mistake to pay off a student loan consider the fact that student loans are not bankruptable. Literally federal agents could come after you if you're late long enough on a student loan and other disciplinary processes have already come to past before that

[@Bmatorff]

I was paying it off early. I should have just kept making the normal payments and let the annuity grow. I saved very little interest and missed out on the market run up for the last 15 years.

[@kentloar2175]

@@Bmatorff Just curious... What was the interest rate on the student loan? And what kind of return were you getting on the Annuity (minus fees and such)? Also curious how this ended up being a $100K mistake? This interests me because my father recently passed away and had a number annuities (6 to be precise). I cashed in all 6 and (mostly) invested the rest. I'm getting a significantly better rate of return now.

[@snellerfinancialservicesll5303]

David, thank you for having the courage to do this! It will be helpful to advisor and consumer for YEARS to come!

[@DavidMcKnight]

I hope so!

[@BreakingTheCycleAuthor]

So, is your main strategy to turn my cash over to an advisor will recommend an annuity or take about 2% a year to manage my money?

[@DavidMcKnight]

That’s not really a strategy. The strategy is to use whatever combination of tools that, according to academic research, gives you the highest likelihood of not outliving your money.

[@brianadams6204]

@@DavidMcKnight How do you justify charging 1% to clients that seems like alot.

[@TheBajamin]

Dave got rich selling courses and books. He didn’t get rich following his method. But I’m also not a fan of the stupid high fees money managers charge. Advising an annuity?!?! That’s just gifting money to shitty insurance companies.

[@DavidMcKnight]

Most PhD’s that have nothing to gain are advising that annuities should be part of the picture. There’s four decades of research that back this up.

[@motoryzen]

It doesn't make a crap how he got rich in terms of the product or service that he sells because the bottom line is he built his current Empire debt-free little by little. So yes he did follow his own advice and his own books. Facts don't care about your feelings on this. Just because you use a different method than what you would have wanted him to use to achieve his financial strength doesn't make his advice null and void Beginning middle and any other time of the day any day of the week any week of the month in a month of the year in a year of a decade any decade of a century or any Century of a millennium, 1 - 1 will always equal zero. Facts do not care about your feelings on this

[@TheBajamin]

@ and yet there’s just as much documentation that the fees and commissions, surrender charges, loss of growth compared to personal investment, make it one of the worst things you can buy. Insurance products are always suspect at best. Of course money managers hawk them, you get stupid commission. Why would I let an insurance company invest my money only to give me back a percent on the actual growth? They guarantee pay is shit even in a down market. Statistically they always come out ahead with my money. Typically I die and the benefactor gets none of the growth. Or I take a stupid expensive variable. But over 100 years the market never stays down.

[@TheBajamin]

@ you’re not smart if you say it doesn’t matter how he got rich. He is saying YOU can get rich following his plan, he was already rich. Easy to take no debt when you have $30 million to start.…. He didn’t get rich following his plan. If I inherit a billion $ and tell you buying penny stocks is the way to financial freedom you’d be an idiot to listen to that advice. Dave is for boomers and people that spend more than they make.

[@terryholden8159]

I’ve listened to Dave Ramsey, many years and agree with most everything. I guess I do Davish as he calls it. I’ve never heard him say don’t use an outside financial planner. Maybe I’ve missed that. I use an endorsed local provider at his advising, and have 10 times the 600k I began with. I continue to listen mostly for the entertainment, but continue to pick up good information along the way.

[@raulalvarado73]

Listen to several advisers and research on your own. My individual desire is what makes me reach Financial Goals. These influencers are just guides, all have pro and con ideas. Your Discipline and Risk tolerance will get you wealthy or broke. Good luck to all seeking Financial Independence

[@davidmcknight8201]

Thanks for your comment.

[@natep1325]

Dave is coming from what hurt him and caused him to file bankruptcy years ago, so that's why he hates credit cards and borrowing so much. So using biblical principles and COMMON sense, his game plan makes sense. Using his blueprint has helped us be debt free, so it's hard to argue against him. We have a financial advisor and she has helped us tremendously with our investing and retirement.

[@DavidMcKnight]

I like biblical principles, but an 8% withdrawal rate isn’t one of them.

[@natep1325]

@DavidMcKnight lol.... I hear ya on that one.

[@BirdDogey1]

I am not interred in a financial product wrapped in a veneer of Jesus. It is swarmy.

[@keithrichardson9127]

I love Dave’s Ramsey teaching I’m not up in debt to my eyeballs that I can’t breathe. I can give more to church and the less fortunate.

[@davidmcknight8201]

Yes, that is his superpower for sure.

[@SmartMoneyBro]

The guru (our title for them, not theirs) is speaking to tens of thousands of people, so 1 size fits all and 30 second sound bits are the name of the game. The financial advisor provides a much more customizable solution. This is the big difference we have to remember.

[@davidmcknight8201]

Great point.

[@DanGarard]

Bought the audio and listened to it in one day! Great stuff! Thanks for your thoughts. I’m in the industry and deal with the same thing.

[@DavidMcKnight]

Awesome!!

[@God.Almighty]

ramsey's main advice is pretty sound, which is stay off debt and spend less than you earn. that's common sense stuff everyone already knows, nothing earth shattering. everything else is to sell some course or service. think most people listen to his show for the callers and how he responds to them. some callers have interesting stories.

[@davidmcknight8201]

Thanks for your comment.

[@robertiola88]

HOPE??? Hope is not a retirement strategy, nor is it a political, military, sports, or anything else strategy. Thanks for using math Dave, much more reliable than hope.

[@DavidMcKnight]

100% agree!

[@amireallythatgrumpy6508]

However, in the absence of hope, you are not going to apply ANY strategy because you believe anything you do will be futile. For that reason, every successful strategy is successful in combination with hope. Hope alone is a terrible strategy. But it is a part of every strategy that is actually implemented. Hope is just the belief that success is possible.

[@kmng3207]

Ramsey is Great .. He assits people to be accountable for poor spending behavior

[@davidmcknight8201]

Yes, he's very good at that.

[@SalmaCorrales-yi4qx]

I love dave Ramsey and susy orman regardles of what anybody say.

[@DavidMcKnight]

There’s plenty to love about them.

[@mickaelsimonet675]

Got the book today! Can't wait to read it

[@DavidMcKnight]

Thank you!

[@trackguy4038]

Clark Howard was the keynote speaker at the Bogleheads conference last year. Wade Pfau is also a regular speaker at the Bogleheads.

[@DavidMcKnight]

They don’t agree on a lot of things.

[@godblessyou7376]

@@DavidMcKnightWhat are some key topics they don’t agree on?

[@zbuglady]

You seem to approve of the time when people asked their friends and relatives for financial advice. I’m a boomer, my father got some staggeringly bad advice that way had to work part-time through most of his “retirement” (until he couldn’t physically). My peer group has included “sovereign citizen” enthusiasts, people who did day-trading on the margin, a guy who didn’t trust banks and basically put all of his 401k money in his mattress. As much as I’m not a fan of Ramsey, many of those folks would have been better off following his advice. The guy who came up with the 4% rule doesn’t really defend it anymore. There are other folks out there doing math who get better results for other approaches now (mostly refinements, not completely radical).

[@DavidMcKnight]

I don’t approve of it. That just happens to be how they did things back then. There are those who embrace a 5% and a 3% withdrawal rate but nobody outside of Ramsey embraces an 8% withdrawal rate.

[@zbuglady]

@ different paragraph, different point. Your wording seemed to imply listening to the “gurus” was not as good as listening to family and friends. That was one point. The other point was not that Ramsey was right about 8%. It was that the classic 4% is a pretty blunt instrument. People have been working on refining it for some time now.

[@chansen9478]

I received my copy today! “THE GURU GAP”

[@davidmcknight8201]

Excellent!

[@mysticaltyger2009]

Correction: Dave Ramsey is very likely NOT a billionaire. According to Celebrity Net Worth, his net worth is about $200 million. Who knows if that's accurate, but I tend to think it's more accurate than the $1 billion number.

[@DavidMcKnight]

He’s told listeners that his real estate alone is worth $1 billion. So who knows.

[@motoryzen]

Yeah that is a very very old assessment of Dave Ramsey's net worth. Currently he is about 500,000 net worth. But regardless that's a hell of a lot more than the vast majority of people in the United States period so what's your point or probably more accurately what's your complaint?

[@Timetoplay20]

Technically Dave Ramsey has no net worth personally he moved all his assets out of his name. Lol. He said that in a show to take the target off him and to spread his assets into LLC’s.

[@BangNguyen-ux4ie]

Dave Ramsey's basis for suggesting 8% annual withdrawal rate was based on his 100% investment in growth stock index funds, which average 15% annually in the last 10 years. On the other hand, Bill Bengen's "4% rule" was based on a 30-year study on a 60/40 portfolio of which 60% is in sp500 large cap index fund. Two different animals. Question is whether Dave Ramsey's growth stock index performance will sustain that 15% rate forever. The stock market has been (very) favorable to growth stocks in the last 10-15 years, but will it last forever? The equity market forecast from the big investment firms such as Vanguard says in the next 10 years, only expect return rate of 4-5%

[@brianm1603]

Sequence of return risk

[@livingworkingoutsidebox]

Love the Al Gore reference 😊

[@DavidMcKnight]

😀

[@jayholiday256]

I think annuities are a great part of many retirement plans. Ramsey seems to hate them and has never presented his argument against them.

[@DavidMcKnight]

Thanks for your comment.

[@brianadams6204]

This whole debate over a safe withdrawal is pointless. It makes more sense to adjust the rate you pull out on a yearly basis depending on what the market did that year just keep a years worth of expenses in an emergency fund incase of a negative year. Some years you could pull out 8% 10% 5% 3% it just depends on the market the years you pull out more if you don't spend it all save it for the next year it really is that simple.

[@DavidMcKnight]

Sorry, the “see how it goes” approach to withdrawal rates has been discredited by dozens of studies. It just doesn’t work. If you take 8% the first two year because you think things are going well and then you have a huge market loss, things go very badly.

[@brianadams6204]

@@DavidMcKnight You would be what is known as wrong. If you take your money out at the end of each year then you know what the market has already done for example if the market is up 20% for the year and you take out 15% then you would still be up 5% if the markets are down at the end of the year thats what your emergency fund would be for.

[@comment2250]

If I were Dave Ramsey, I wouldn't respond to this guy because the overall positive results of Dave's work and financial advice speak for itself. And, of course, his advice and counsel is not for everyone. At the end of the day every person has to decide for themself if any financial advice is for them, or not. This guy is trying to get attention for himself and his book, what better way to do that than to have someone of Dave Ramsey's stature and popularity to have a back and forth banter with.

[@davidmcknight8201]

Thanks for your comment. I think it's a bit of a cop-out to say that anyone who challenges a given opinion is simply looking for attention. Why not evaluate the substance of my critique? Why not speak to the reality that the mainstream financial community (to include every CFP I've ever spoken with) condemns Dave Ramsey's general retirement approach? Or you can go with the "just wants attention" bit...

[@brucefredrickson9677]

David, having a payed off home is more than just math...it's peace of mind. I will tell you that it's a feeling well beyond looking at a spreadsheet. BTW, I ordered your book yesterday.

[@DavidMcKnight]

Thank you, Bruce

[@markpaperhanger2481]

Please tell all

[@DavidMcKnight]

I tell much but perhaps not all. 😉

[@kennethroyer9949]

It is unfortunate that Dave Ramsey continues with his 12% return and 8% withdraw rate. What is maddening it is completely unnecessary! Also due to the period of time when interest rates were sub atomically low Ramsey still advocated paying off the mortgage early. There has been some callers with a 2% mortgage my Lord a short term bond fund is paying 4 to 4.5 percent. What I do agree with Ramsey is that he is talking to the masses who quite frankly have a hard enough time managing their checking accounts and many have made a disaster when it comes to credit cards. Dave's approached is akin to the Alcoholics Anonymous with a very direct and harsh approach to money management. On balance (despite his flaws) it works when considering the masses alternative of self destruction!

[@davidmcknight8201]

Yes, lots to be frustrated at with Dave, but he has done a lot of good.

[@CaliAAA72]

Man Dave Ramsey is totally living rent free in this guys head. Tell you what when you have half as many success stories as Dave then I’ll listen to what you have to say. Other than that stop talking about others and continue to help others with your system.

[@DavidMcKnight]

Yay! Dave can get people out of debt. Therefore his 8% withdrawal rates won’t REALLY bankrupt retirees 63% of the time. This video is the promotion for a book through a mainstream publisher about the failure of financial gurus. And all the lousy advice Dave his given retirees will be on full display.

[@grega2362]

If the market grows at 8%/year. Over the last 20 years, compounded Nasdaq 10.6%, SP500 9.7 and Dow 6.7%. So properly invested, you could take 8% on avg per year and not be broke. If the caller was 72 YO and had a mil in the bank and made zero interest, would be able to draw 80000 for 12.5 years making him 84.5y/o which is 2 years past the avg male lifespan in the US making zero interest. So yes, he can take a 8% withdraw rate for a year or two if he wants to. 4% is just a rule of thumb, NOT a gold standard. You build a multi million dollar nest egg by investing steady over a long period of time, at least I did at a slightly above avg wage. I'll pass on your book thanks.

[@davidmcknight8201]

Do a quick google search on "sequence of returns risk."

[@PJBHolden]

You have glean bits and pieces from each “guru” and come to your own conclusions.

[@DavidMcKnight]

Just calling it like I see it.

[@Timetoplay20]

I think you are wasting your time with Dave. The guy that did the 4% rule he was on Rob Bergers show and that guy invests in really crazy investments. The more I listened to him I wouldn’t follow that guy. Jack Bogle was the only reasonable person I found to make sense. Based on the way Dave says he splits his stock allocation. He says he puts 25 percent in International stocks there’s zero way I believe he pulls in a 10 to 12 percent annually return? What say you?

[@davidmcknight8201]

I say Jack Bogle is great. I think 9% is a much more realistic return, given a long enough horizon.

[@spatty2589]

This guy is not the hero. He is claiming to be. He keeps saying guru, but both Dave and Suzie have financial backgrounds, experience, and helpful information. If the only reason he wrote a book is too down them he’s setting himself up for failure. He also said if people follow their advice. Give me some real information. Give me real Examples of people who have gone broke following Suzie or Dave. This is just click bait.

[@mysticaltyger2009]

The fact that people aren't going broke following Suze (correct spelling) or Dave is a very low bar to clear. If you consistently spend less than you make (which they both advocate), you won't go broke, by definition. Just to give one example, Dave's 8% withdrawal rate in retirement is quite dangerous for most people. Pretty much everyone who's studied the issue agrees it's way too much. I've seen the younger people on his staff start to (tentatively) push back on that.

[@DavidMcKnight]

Very reputable studies show that if you follow Ramsey’s 8% withdrawal rate you’ll go bankrupt in advance of life expectancy 63% of the time. This is nothing short of financial malpractice.

[@brucefredrickson9677]

I think the helpful take-away is to glean the good/bad from any "guru" yet know enough about finances so you are informed.

[@davidmcknight8201]

@@brucefredrickson9677 I agree.

[@davidmcknight8201]

@@brucefredrickson9677 Exactly.

[@cerbico12]

The other problem with Ramsey is he does not take inflation into account. He finally said on the radio the other day his idea of a millionaire is one who has a used camry, owns thier own hous and has 500K in retirement funds. Does not sound very asiprational to me although it is better than having 0. I think most would like to have 10 million at retirement for saftey and comfort and 25 mil to have f u money or even a billionaire like Ramsey much of which he has made off his radio empire. He is a great salesman. My first boss Ross Peroet was a great salesman as well as are many successful people.

[@DavidMcKnight]

Thanks for your comment.

[@brucefredrickson9677]

I think Dave is most helpful to people that keep borrowing money instead of paying cash...home excluded.

[@motoryzen]

You want inspirational meaning someone who will lie to you and bull crap you thinking you're going to be as rich as the people on the Real Estate Network in the 80s back when things were far cheaper versus the cost of living versus income? Or do you want a real world no BS assessment? I don't know about you but anyone with half a brain will tell me that I want the facts in reality because reality is what we have to deal with regardless of what our feelings dictate

[@jabow1878]

Wait! In two years people have run out of money using Dave plan? I followed Dave through the steps until six. Then I looked at what he expected to make year over year and what I saw as reality. I also used one of his “smart investor pros” and found them to be risky for me. Different than Suzie, I think Dave just over his skis once people know how to save money. I think Suzie was lucky and marketed her luck.

[@futurefantastic]

Dave Ramsey is not worth a billion come on now Where is this information he is worth a billion I searched and cannot find anything like that. Send me the link he is worth a billion

[@DavidMcKnight]

He’s told listeners on his show that his real estate alone is worth to $500 million. So what’s the rest of his empire worth?

[@amireallythatgrumpy6508]

His net worth is in the range of $700-$800 million. He's close but not there yet.

[@BirdDogey1]

Ramsey’s advice is horrible. Nobody who makes real money would ever follow it.

[@georgesontag2192]

Dave Ramsey doesnt recommend pre nups. I got married and divorced and lost everything. I should have got a pre nup.

[@alanberry4919]

The Ramsey situation about drawing more money is taken out of the context that the man was already a few years away from the average life span and had millions already. He couldn't spend it all.

[@DavidMcKnight]

The 4% rule doesn’t fluctuate once you get older. It’s designed to only adjust for inflation once you retire.