Why You Should Focus On Paying Down The Mortgage Over Investing

[@TheRamseyShow]

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[@martingonsalez6635]

The Dave Ramsey Show mr Dave Ramsey I need you help I need to buy a newer car and I have a mortgage payment of $500 a month and bills up to 550 a month I make around 30,000 a year (in Arizona ) I want a 25,000 dollar car and I have save $11,000 cash you think I will still be good with a $500 car payment. Or it’s a bad decision can you please steer me in a right direction. I also have what I call an emergency fund of 5,000 dollars

[@cryptofreedom2226]

i need helppppppppppppp . baloon payment questions

[@freedomrings4134]

@@martingonsalez6635 here let me help you. Buy the cheapest most reliable car you can for cash.

[@martingonsalez6635]

J Faulk I did bought a super clean car for ten thousands dollars and we are really happy with it

[@subman23]

@Martin Gonsalez congratulations on your maturity and discipline. If only I could have convinced my sister do not take a car payment

[@nemishasharma5737]

A year and a half ago I came across Dave on KZbin. Yesterday I paid off my house, and all my other debts are long gone. 30 years old. Thankful for Dave.

[@TT-by7tv]

What's your yearly income?

[@nemishasharma5737]

@@TT-by7tv I have a pretty good income now.. I live in India so I doubt the numbers will make sense compared to US.

[@Airbender24B]

Wow

[@LittleCreationsETH]

Impressive!

[@albinusclark9561]

Am going to focus on paying my mortgage

[@hoosier-daddy-wv5gi]

I paid up all my mortgages in 2yrs while working with a Financial Adviser. I’m 50 and my husband 54 we are both retired with over $3 million in net worth and no debts. We got to realize that the secret to financial freedom is making better investments.

[@avamadison-r9p]

If anything, the situation will worsen. Affordable housing will soon become unaffordable. Therefore, I advise taking action now, as today's prices will seem low compared to the future. Until the Fed takes more stringent measures, I anticipate widespread hysteria due to rampant inflation. You can't remove the band-aid halfway.

[@richardhudson1243]

Home prices will come down eventually, but for now; get your money (as much as you can) out of the housing market and get into the financial markets or gold. The new mortgage rates are crazy, add to that the recession and the fact that mortgage guidelines are getting more difficult. Home prices will need to fall by a minimum of 40% (more like 50%) before the market normalizes. If you are in cross roads or need sincere advise on the best moves to take now its best you seek an independent advisor who knows about the financial markets.

[@StephenLogan-g2v]

I will be happy getting assistance and glad to get the help of one, but just how can one spot a reputable one?

[@AaronPatrick-x2j]

She appears to be well-educated and well-read. I ran a Google search for her name and came across her website; thank you for sharing.

[@simon3101]

Please report this whole comment chain. It is spam to promote a financial scam.

[@JRInTroy]

I’m paying off my mortgage this month. Single female 45. Yas.

[@danny92980]

God bless you 🙏🙏🙏

[@artistman75]

Nice, I paid off my first when I was 43, the second will be paid for at 54 or sooner and the third I shooting to have it paid off by 60.

[@JRInTroy]

StirCrazy congrats

[@rickbassh7851]

U still single ;)

[@iamnottheone3020]

@Leerik Yasuas🤣🤣🤣🤣🤣 Anyway Congratulations for paying off your mortgage, be careful there are a lot of men out here looking for a sugar mama. My mortgage is paid off too but I will never let anyone in my real life no that!

[@BrewersArcade]

We are two months away from paying off our mortgage. It’s worth the challenge guys. Age 39 and debt free with three kiddos.

[@SR-dp1tx]

How??!

[@jackofalltrades4844]

BrewersArcade sound like you did a 15 year note!

[@mammothorbust]

Congratulations! I'm 30 with two kids, hope my wife and I can do the same by that age.

[@TheDaman1111]

Shed some details. 33 here with three kids and would like to do the same

[@l.ls.8890]

Keep at it and then given yourself a debt free scream.

[@blr141]

So the message Dave is trying to send here is: yes you can mathematically earn more money by aggressively investing more while paying down your mortgage. However, history has shown us that human nature and unpredictability is more powerful than mathematical equations. You may lose your job, or go through some kind of financial crisis. You would rather have that house paid off rather than trying to cash out your investments during a financial downturn. Life is unpredictable, so paying off your debts give you a peace of mind.

[@jerrydixon3862]

I would rather lose my job with a 30 year mortgage and have a bunch of money in addition to my emergency fund sitting in non-retirement investments than lose a job and have a 15 year mortgage I’ve been aggressively paying on with no non-retirement investments

[@jerrydixon3862]

My plan therefore is to get on a 30 year mortgage, use the lower payment to invest more, and eventually I will reach a point where that investment account could pay off the house entirely. At that point I will decide if I want to, or if I’m happier with keeping the investment and let it grow

[@han1218]

@@jerrydixon3862 good idea, but there's also a possibility that your investments won't grow. Not everybody is good at investing. For some it's better to just pay off the house, and at least save money from interest, and then they can "learn investing" by failing multiple times, but whatever loss happens, they will still have a house to live in

[@erikrohr4396]

@@jerrydixon3862 I agree, keep the mortgage and continue to invest. Ironic that the show that says cash is king tells us to put all our cash into the mortgage rather than keep it!

[@Doors067]

I dont see why you can't just do a little of both

[@willywonka69xx]

I paid off my house when I was 39. I'm 52 now. It was the best investment I ever made...in terms of emotional health and financial stability. We have been debt free since...we live in California so not a cheap place and my Wife was a sahm...what did we give up to do it? New cars, eating out, fancy vacations and so on...now we have newer cars, eat out often, have great vacations, and a secure retirement. My peers, who thought we were nuts driving those beat up cars, are STILL paying on their houses and can't afford to do what we do...so, save early and avoid debt early for a nice long term life!

[@angelicab2260]

Love this! Truly inspirational! May God continue to bless u and your family🙏.

[@jimmay1988]

Thanks for sharing your success. Everyone in 30s and younger feel like they have to be 20 to enjoy the world, as if civilization will end.

[@markcrisp07]

Sacrafice comes early or late for sure

[@willywonka69xx]

@@markcrisp07 To be honest...The sacrifice was not major...My car drove, it had AC, it started most of the time...we bought 80 percent the house we could "afford"and it was a fixer. (Still there!) We went to the beach, lake, river, community pool, instead of Disneyland... Looking back I don't feel like we gave up that much...is eating at the bar and grill better then sitting at the table with your family? Is WAITING till the kids could actually ride the rides at Disneyland horrible? Is WAITING a few years to buy a three year old Honda Civic terrible? For me it was fine. I live my life and married my wife...I'm not out to impress anyone but her; if she is in the mood to be impressed! (BTW...when the kiddos got older my Wife went back to work...first part time and now full-time since the kiddos can drive. The money she earns is not for core bills or core savings. It is for "fun"...as her income increased so has our fun budget.)

[@raamsvcsl.l.c.7811]

Absolutely...great advice!

[@YakMotley]

I paid my home off immediately! The big key to this argument for me was PEACE OF MIND! I have never had more peace of mind than when I paid off my mortgage. The rate of return on a paid off home is A LOT! Way more than nickle and diming a few percent!

[@TartarianTopG]

You were the caller?

[@lHurtYourFeeIings]

I paid off my 30 yr mortgage in 4 years.

[@jillwilliams7554]

I will be mortgage-free in just less than 4 years. Thank God.🙏🏿

[@BenRangel]

Did you worry a lot about it before you paid it off? Personally I’ve never had trouble sleeping over a mortgage. (I amortise a lot but have quite a lot left and it's not like I walk around feeling weighed down by debt)

[@michaelh5055]

It's just a different feeling waking up in the morning knowing that the place is yours. It's also nice knowing that if you lose your job. No bank will ever be calling and threatening foreclosure. Worst case scenario. I can cut some lawns every month and pay utilities.

[@lynnebucher6537]

I had to make this decision also. I did a hybrid approach, maxed qualified retirement savings, cut unnecessary spending, and threw everything else at the 6.25% mortgage. I definitely noticed that during the Great Recession, those with paid off house who lost their good job could take any low paying position and still pay bills.

[@DeNovoAgency]

refinance!!

[@Nolaman70]

6.25 is very high, I refined mine years ago at 2.875. Paid off now, saved 50k in interest even with that low rate...

[@brodrickniemeier8529]

@@Nolaman70 Sounds like this might have been awhile ago, like finished paying it off before 2008, but I could be wrong.

[@MaximilianFischer497]

From paying for day care and college, to managing mortgage payments. I'm approaching retirement yet inflation is getting worse and recession is biting harder by the day. How can I generate more income to retire with at least $3m for long term care? I have about 750k in savings.

[@TicheDebb0]

Investors like you should be cautious of the bull run, its best you connect with a well-qualified adviser to meet your growth goals and avoid blunder.

[@EvelynBrooks0]

Accurate asset allocation is crucial, I used hedging strategies to allocate part of my portfolio to defensive assets for market downturns. Expert guidance is vital for achieving this. This approach has helped me stay financially secure for over five years, yielding nearly $1 million in returns on investments.

[@MarshalWagner457]

This is definitely considerable! think you could suggest any professional/advisors i can get on the phone with? i'm in dire need of proper portfolio allocation

[@EvelynBrooks0]

There are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with “Rebecca Noblett Roberts” for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look-her up.

[@AshleySommerset808]

I just checked her out on google and I have sent her an email. I hope she gets back to me soon.

[@j.r.f8381]

Just paid off my mortgage of $179K today and had some reservations about it. I earn quite a bit and one of my businesses just underwent acquisition so I came into a large chunk of cash. Everyone was telling me to invest in the S&P, instead of paying off my mortgage, etc.. Sigh.. thanks for reaffirming me. Now I am 100% debt free. 29 married male.

[@fredericksharon6908]

YOOHOOOO. Sounds goood.

[@shaunbat5097]

Pay it off save all that interest, you can invest now...good move!

[@LUISMARTINEZ-fy9wx]

Just curious what is a great idea? Does this put you in a different tax bracket paying off so much at one time. would it be better paying a couple thousand dollars a month to principal until it's paid off to stay in a lower tax bracket?

[@aaront936]

Yikes you just knee capped your financial ability for compound interest to pay down the cheapest mortgages in history.

[@babiesdontgoclang]

Good choice. That S&P just dropped but you own that house 👍

[@agr8fulson]

he's right. people generally don't become millionaires until AFTER they pay off the house. do NOT listen to all those idiots telling you 'why payoff the house when money is so cheap?' do NOT listen to that garbage! paying off the house will give you piece of mind and a tranquility/happiness that VERY few people will ever know!

[@darbyohara]

It’s not garbage, it’s simple math and good investing. Garbage would be missing out on investment growth and time value of money to pay off a 3.5% mortgage rate 😂

[@agr8fulson]

suit yourself, genius. just make sure that in 2030, you're not liquidating everything cause you lost your job and the markets are down 60% and i'm standing there buying your house for $75k.

[@danielaltherr1229]

This guy is killing it! Good for him! Dave, great advice! You have changed mine and my wife's life. We are 30 and 28 years old and just got our house paid off. No inheritance or anything. Just hard work. Keep up the good work Dave!

[@jessewilson-music]

Literally the exact 5 words I said when the video ended! "This guy is killing it!"

[@meetseth3]

Where do you live? If it’s not California, New York or any other big cities with expensive real estate, then it’s not that impressive. I bought a townhouse in SoCal and my dream is to pay it off. At 28 years old, the idea of paying it off right now is ludicrous

[@robertodiaz1597]

@@terrythompson1548 Right? Sounds like someone is salty because they cant do it because of where they choose to live. Good for them. I'll be about 40 before I pay mine off unfortunately, but no need to hate.

[@bobmarker6812]

Daniel Altherr, Congratulations. One less outgoing bill and the bank no longer owns your house. Mortgages are amortized meaning the interest payment rate is much higher than 3.75 (example) in the first part of the loan.

[@JonMoralesLA]

Alan Nguyen - I totally hear you. Dave Ramsey’s advice really only works for a subset of people. It’s not for everyone. If my mortgage was $150-$200K in bumf*** nowhere...sure let’s plan on paying it in 10 years. I also live in SoCal and that’s just completely nonsensical.

[@ranep548]

For newbies, be aware that this is a grossly oversimplified scenario. For one thing, you can't get a mortgage on an investment property without at least 25% down payment. Two, it's easy to see comps for house purchase prices, but it takes a lot of research to understand the comps on rent prices. The trick is to find a place where renting is more expensive than buying, but those places are less common because of this very type of scenario. Three, you have to remember that rent number he's using is supposed to be net income, not gross. So you have to think about costs for taxes, insurance, maintenance and vacancy when you're researching investments. All that said, real estate investing is a good tool for wealth accumulation. But it isn't foolproof.

[@CrystalCorporation3]

Very soon, affordable housing will no longer be affordable. So anything anyone want to do, I will advise they do it now because the prices today will look like dips tomorrow. Until the Fed clamps down even further, I think we're going to see hysteria due to rampant inflation. You can't halfway rip the band-aid off.

[@joshbarney114]

Home prices will come down eventually, but for now; get your money (as much as you can) out of the housing market and get into the financial markets or gold. The new mortgage rates are crazy, add to that the recession and the fact that mortgage guidelines are getting more difficult. Home prices will need to fall by a minimum of 40% (more like 50%) before the market normalizes.If you are in cross roads or need sincere advise on the best moves to take now its best you seek an independent advisor who knows about the financial markets.

[@rogerwheelers4322]

Personally, I can connect to that. When I began working with "Colleen Janie Towe’’ a fiduciary financial counsellor, my advantages were certain. In these circumstances, I would always advise getting professional help so they can steer you through choppy markets and just give you indicators and strategies for knowing when to enter and exit the market.

[@eloign7147]

@@rogerwheelers4322 I will be happy getting assistance and glad to get the help of one, but just how can one spot a reputable one?

[@rogerwheelers4322]

@@eloign7147 My advisor “Colleen Janie Towe” is a highly respected financial consultant in the industry. For further information or to connect with her, a simple online search with her name will suffice. I wish you every success in your endeavors

[@ralphbernhard1757]

We paid off our house asap. It was paid off by the time I was 35. Nothing is more valuable than "peace of mind". No obligations. No debt. That is real freedom.

[@daveshilling2673]

Property tax and escrow is a monthly obligation forever...and your house will be taken if you don't pay them...that's eternal indebtedness

[@ralphbernhard1757]

@@daveshilling2673 Luckily I live in Spain. It is an easily manageable 600 Euros per year, so like 50 a month.

[@miketheyunggod2534]

Stop paying the taxes and you will see who really owns your home. Taxes is debt idiot.

[@derick3482]

@@daveshilling2673 not quite that is a good debt to have but dave failed to teach you that it's always better to own than to rent

[@Red_1976]

Absolutely! Well done 👍🏼

[@spursnation5422]

I just paid off my mortgage in less than 15 years and I just turned 49 ,such a great feeling not having a mortgage anymore!!!!

[@Brand00d]

Django is great

[@otreborfashionscene5986]

I paid off my house 4 years ago, am 60 didn't had a good paying job until 8 years ago, I have saved 100k in IRA retirement in 6 years, I wish I started earlier, but all of my jobs were almost minimum wage, I got this job by the grace of God and looking forward to retire at 65....... And no children to take care of.

[@dreambadger]

You did it that's the main thing.

[@LisaBre]

Congratulations 😊😊

[@AlexanderOwenb9l]

Investments are the roots of financial security; the deeper they grow, the stronger your future will be."

[@AidenLiamf7q]

The deeper your investment roots, the stronger your financial security will be in the future.

[@IsabellaAriau2m]

Exactly! With my adviser, I’ve cultivated deep investment roots, strengthening my financial security for the future.

[@NatalieHannahq3g]

I would love an introduction to an adviser who can help me strengthen my financial roots.

[@IsabellaAriau2m]

Nicole Anastasia Plumlee can't divulge much. Most likely, the internet should have her basic info, you can research if you like.

[@NatalieHannahq3g]

Thank you for this amazing tip. I just looked the name up and wrote her.

[@sirheisenberg4459]

Mortgage rates are currently at an all time high since 2000(24 years) and based on statistics on inflation, we might see that number skyrocket further, a 30-year fixed rate was only 5% this time last year, so do I just keep waiting for a housing crash before buying or redirect my focus to the equity market

[@belobelonce35]

True, I mostly just buy and hold stocks, but my portfolio has been mostly in the red for quite awhile now. Unfortunately to be able to make good gains, you’ll need to be consistent and restructure your portfolio frequently.

[@PennyBernadette]

This is precisely why I like having a portfolio coach guide my day-to-day market decisions: with their extensive knowledge of going long and short at the same time, using risk for its asymmetrical upside and laying it off as a hedge against the inevitable downward turns, their skillset makes it nearly impossible for them to underperform. I've been utilizing a portfolio coach for more than two years, and I've made over $800,000.

[@NorthCarolinaForward]

my partner’s been considering going the same route, could you share more info please on the advisor that guides you.

[@PennyBernadette]

My licensed adviser of choice is Rebecca Nassar Dunne. Just look up the name. In order to schedule an appointment, you would find the required information. She is quite talented.

[@KatyaSantos-g4c]

I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.

[@5thdimensionliving727]

I paid my house off four years ago, no debt, decent regular income, careful personal expenditure, etc and I cannot begin to tell you the peace of mind I have now. Everything I earn is going towards my retirement, lifestyle and charity and life couldn’t be better. Without knowing about the Dave’s baby steps before, it’s almost as if I had followed them to reach the position I am in now. All the advice from this channel is 100% on point. I wish everyone all the best in their finances. Thank you Dave 🙏🙏

[@jimroscovius]

We paid off our house and are investing like crazy!! It's a great feeling not having that debt.

[@jimroscovius]

@Al Ex Nope - we have a great retirement set up. In fact, if I retired now, I would get more money than I do working. But, I keep working so I can keep investing. We invest the house payment we used to have to pay. Why give money to the banks?

[@jimroscovius]

@Al Ex I know what you're saying, but the peace is worth a lot. And we're doing fine.

[@insideoutsideupsidedown2218]

@@jimroscovius peace of mind is worth more that investing.

[@georgesealy4706]

I moved to my retirement area, built a house, and I paid off the mortgage 3 years before retirement. It makes being retired sooooooo much easier. Plus my property taxes are fairly low. I suggest this to anybody.

[@ELIRAXPRT]

George Sealy that’s great advice but this guy is 35. He will probably work another 25 to 30 years.

[@gusthomas2423]

We refinanced twice to reduce the time on the loan and got it down from 30 to 22 years. We currently have zero debt and the mortgage will be paid off next month! Dave, you have been an inspiration to both my wife and I and my son and his family.

[@victortheconqueror2518]

This man don’t miss, two years later and he was absolutely right about home value and what the extra money should go to.

[@recabitejehonadab2654]

Yes, “ The money is cheap, but the freedom is priceless”.

[@fivebooks8498]

How am I more free with a paid off house but no investments making income versus carrying a mortgage but also having investments that out perform the mortgage rate by 10 fold?

[@TartarianTopG]

Five Books ikr

[@strangerdanger8462]

@@fivebooks8498 I believe Mr. Ramsey answered your question in the video.

[@fivebooks8498]

Stranger Danger I didn’t hear it but If he did then it was a dumb answer. If investing my money out performs my mortgage payment then I am more free going that route. How can anyone dispute that? Numbers don’t lie.

[@leesauter2837]

@@fivebooks8498 exactly

[@famoustourist]

In my early 20s someone gave me a advice about saving which I took, built my house when I was 30 and finished paying it off now at my 32. I got only 3 credit cards with no debt. I did not go out much I only went to college and had a normal life. I got 2 kids now and im so glad I took that advice seriously.

[@deborahsimon1101]

That's wonderful, Victor! Congratulations. What a great example you're setting for your kids.

[@ventzp2133]

You paid off a house in 2 years!?! Oh my

[@jtcanfie11]

@@razojacqueline He saved from when he was 20 to 32. So instead of paying a mortgage on a house of say 1000 dollars a month he took that and saved it for 12 years. That's 144,000 without even investing it. So he could easily buy a 200,000 dollar house and pay it off in 2 years

[@cristianion2056]

Are you romanian? That way.

[@Handbagqueen23]

Why do you need credit cards if you own your house and are debt free isn’t that what savings are for?

[@hollybaker3917]

We're paying off the house in three more days!

[@xbjrrtc]

🎉

[@exerciseisantidote9337]

Happy for you

[@nathanielcarreon5634]

Paid off mine in ten years and retired 10 years earlier than usual.

[@MoonLiteNite]

had you not paid it off, you could have retired even sooner... the math doesn't lie. If you feel the emotional need to remove debt first, go for it. But maths are facts, better to invest.

[@ElectricBlueIX]

Chris Banana retire with a mortgage...good idea.

[@byreadholliday3812]

@@ElectricBlueIX right

[@jalenmalone7808]

Chris Banana if you pay off the mortgage you have an insane increase in cash flow. Investing an extra 1000 a month compared to having to keep paying the mortgage minimum every month

[@byreadholliday3812]

@@jalenmalone7808 agree

[@larhondah.2793]

We purchased our home 10 months ago and plan on paying it off in 10-15 years. God willing once I retire from the military. I'll be 45 and my husband 53!

[@akastenas]

Safe jobs ar the best. You will retire early, establish a business and will lead a great life. Military pays well.

[@algorhythm4593]

@@akastenas MILITARY DOES NOT PAY WELL!!!

[@joelpadilla5592]

@@algorhythm4593 it does pay if you take advantage of your time in and the benefits. Plus if you get a retirement plus disability it really pays

[@mpgisbtsarmybaefighting2838]

Oh good luck to you and thank you so much for your service. Please keep safe.

[@mocheen4837]

Great job and thank you for your service.

[@JeremiahParker-]

The problem we have is because Most people always taught that " you only need a good job to become rich. These billionaires are operating on a whole other playbook that many don't even know exists.

[@AdamNathan-]

Money invested is far better than money saved, when you invest it gives you the opportunity to increase your financial worth.

[@ZahidTaimoor95]

It is remarkable how much long term advantage people like us have gotten by trying to be consistently not stupid, instead of trying to be very intelligent.

[@MiaAva872]

The wisest thing that should be on everyone mind currently should be to invest in different streams of income that doesn't depend on government paycheck, especially with the current economic crisis around the world. This is still a time to invest in Stocks, Forex and Digital currencies.

[@AnastasiaIvan-hs3vg]

Many individuals report success in investing in stocks, forex, and cryptocurrency (Bitcoin), yet I continue to struggle. Can somebody help me out or advise me on what to do?

[@RogerTerry01]

Even with the appropriate method and assets, some investors will still outperform others. As an investor, you should already know that nothing surpasses experience, and that is final. Personally, I had to seek advice from a stock specialist, which allowed me to build my account by over $35k, extract my profit just before the correction, and now I'm purchasing again.

[@donaldyurko1284]

Just "bought" my home at 59! I am throwing all I can at the mortgage and have it figured out to be paid off in 12 yrs. May be late in life to do this but renting made no sense at all.

[@fgjf1079]

It's all about locking in your cost of living. When you rent, your housing cost tends to rise over time.

[@donaldyurko1284]

@@fgjf1079 at this point of my financial life it was a smart move, at least to me. I was renting to own. The house appraised at 172K and I was able to purchase it for 141! I didnt gain all my rent paid back, but the 30k in equity made it an easier decision.

[@suttsd]

@@fgjf1079 actually it's never completely locked in. The home payment is set if you have a fixed rate, however, taxes and home insurance can go up resulting in a higher payment

[@fgjf1079]

That's minimal compare to the grand scheme of things. I just went to an open house, and noticed that the previous owners were paying $700 in ANNUAL property taxes on a house that is worth 700k. I'm in California, so that's what I mean by locking in costs, as that person should really be paying 7-8k on that house, but Prop 13 helped them lock in that cost. Sure, certain expenses will go up, but you have a little more control, when you're the owner of the property. When you rent, the landlord can raise the rent for no reason.

[@misspriss2482]

Really? That makes me feel better. I'm in my mid-40s thinking about buying a house.

[@harrisonjamie794]

I admire the financial independence of people, But you can live better if you work a little more. After watching this I think there are people out there, on the extreme, who plan to die early just to be able to retire early. To each their own but to me, retirement isn't just about not having to work, it's about having the freedom to do whatever you might reasonably want, such as travel, buying things, enjoying life, etc. I don't think I could retire with less than $3m in income-generating investments, maybe $2m at the very minimum. I plan to work until I'm at least 45

[@MarcelPhilips]

Nobody knows anything, you need to create your own process, manage risk and stick to the plan, through thick or thin while also continuously learning from mistakes and improving

[@harrisonjamie794]

@@MarcelPhilips Having an investment adviser is the best way to go about the market right now, especially for near-retirees, I've been in touch with a coach for a while now mostly cause I lack the depth knowledge and mental fortitude to deal with these recurring market conditions, I netted over $220K during this dip, that made it clear there's more to the market that we avg joes don't know

[@MarcelPhilips]

@@harrisonjamie794 Who’s the person guiding you

[@harrisonjamie794]

@@MarcelPhilips credits to KRISTIN GAIL CUNNINGHAM, one of the best portfolio managers out there. she's well known, you should look her up

[@MarcelPhilips]

@@harrisonjamie794 Thank you, I just checked her out and I have sent her an email. I hope she gets back to me soon.

[@orochicc002]

The main takeaways: 1. "Rainy day fund", 401k, and college fund come first, those are not "extra income" 2. Mathematically (based on mortgage APR vs investment Annual Return) investing should have a better outcome, BUT 3. Statistically, "successful" people paid off their loans early 4. Once debt-free, people can afford to take more risks, and more options in life choices open up

[@denisl2760]

@@slmunney7760 Agreed. Its more like "they were successful first, and that allowed them to pay off their mortgage". Not "paying off their mortgage was a really good financial decision and therefore they became successful". Moral of the story: paying off your mortgage won't make you successful, in fact its a suboptimal use of your money.

[@Musicienne-DAB1995]

@@denisl2760 How is paying off your mortgage a suboptimal use of your money, if the bank makes the majority of the money from your keeping it?

[@steve99912]

@@Musicienne-DAB1995 there's way better use of capital than paying off a 2.5% mortgage

[@jessa9877]

My plan is to have 100k in investment, 100k in a down for a house, then pay the house as quickly as possible

[@HighCountryRambler]

Suspecting folks invested in hot markets while holding low interest mortgages, when investments compounded there was ample (and more) cash on hand to pay off the mortgage, which is the unmentioned piece is this equation.

[@marindedonpingue7840]

I paid my house in cash at the age of 35; after the military, full time law enforcement and full time college! Three degrees later (AAS, BAAS, MBA) debt free, disposable income, passive income and living a good life

[@josemv25]

This guy would be proud of you

[@blackpinkslave9969]

Awesome, thank you for your service.

[@tylerfoss3346]

Our circumstances are such that we paid off our mortgage the year my wife retired and two years before I did. We didn't follow Dave's baby steps (not knocking the Ramsey system at all) but were already deep into living (marriage, jobs, children etc) before we even heard Dave Ramsey on the radio. However, paying off that mortgage has had a tremendously powerful psychological effect on living. Dave talks to it: you now own the property. It's all yours. No one else has a claim on it. No one can kick you out as long as you pay the state and municipal taxes. It's freedom, folks! And it is wonderful.

[@Red_1976]

Desperately want to clear my mortgage. $198K to go. I’ve paid just over half already & at 46 I’m still plugging away. Will get there! 🤞🏼

[@BradZook]

I suppose there are some people who want the "peace of mind" & I understand that, but I prefer a calculator. My mortgage is costing me 2.7% & my stock portfolio is making 15-20%.

[@fadedflage]

Yeah with current affairs, debt is pretty cheap and inflation melts the ice cube of cash

[@pascal_f1300]

I work for a financial institution and I can tell you that they LOVE people like you.

[@marktheshark2569]

Dang what you investing in to get 15-20%

[@eljeffe991]

With a 2.7% mortgage and inflation what it is, you are being paid to borrow in terms of real return. That mortgage payment will never go up even though your home value will. The longer your can take to pay the house off with effectively free leverage, the better. This is how the rich get richer.

[@soonermagic24]

You’re smart. Everyone else commenting aren’t there yet.

[@kend9388]

On track to pay our house off in about 4 1/2 years. I'll just turn 36 and my wife will just turn 34. I want our 2 kids to one day inherit something. My wife and I started from scratch and didn't receive any inheritance. Paid off all of our debts including cars and student loans. All hard work and team work. I can't wait till the day when we're finally mortgage free and debt free!

[@mocheen4837]

I am in a similar situation except we will not be able to pay off our hone for another 15 years. In San Francisco the homes are very pricey. Our house has increased in value by $900,000 since we purchased it 17 years ago. We are thinking about selling it and moving 1.5 hours away and paying cash for a new house and banking $200,000. We would then be able to save $80,000 per year towards retirement.

[@kend9388]

@@mocheen4837 That sounds like a good idea. That kind of plan could set you free financially. That's the goal.

[@brianr1165]

I paid my house off when I was 33. Best decision I ever made. Most of the house was paid for with a income of under 40k

[@ineedhoez]

How much was your house? Dear god.

[@yasaipicles6295]

Following in similar footsteps.. at 29 and 1/3 house paid.. hoping to get it paid by 33ish as well. House bought at 290k

[@brianr1165]

ineedhoez 193k

[@brianr1165]

Yasai Picles You can do it!

[@EyeAmLouDaddy]

This is terrible advice. The opportunity cost is to great to pay off a mortgage charging 3.5% interest. Especially if the person he is using as example does not have the $$ to pay off the full mortgage. You know what home owner is more likely to get reposted. The one with the least $ left on their mortgage. Smh

[@kh884488]

Our house isn't big and many may consider it a starter home, but several years ago at the age of 41, I paid it off. Now, all I need to pay for is property tax and insurance. It's a great feeling and gives a lot of peace of mind

[@thomask8298]

Plus maintenance. That's why you should always rent. Roof goes out, you're fine.

[@767bob]

@@thomask8298 Folks who own a home dept free are usually net worth 10 X more than someone who stays in an apartment. If my roof goes out, home insurance will take care of that.

[@Srode1999]

​@@767bobthat is of your roof is damaged by a covered event. Eventually your roof will need replacing due to age, which is not covered by homeowners insurance. Also, you will at some point need new HVAC equipment, water heater etc. I don't know if renting is better than buying but every time I have to replace or repair something in my house, I wonder .

[@767bob]

@@Srode1999 Life is not fair and free, planning for the bad things to happen is all part of the responsibility of owning a home. It is no different than owning a car. In the long run, it is cheaper to own a home, not paying for rent. It is hard to see this when someone is in their 20's and 30's but after the mortgage is paid off, and time goes by, the clear winner is owning a home. Start young, plan, save and invest (owning a home is part of the plan) it gets easier as we all get older. Most of these videos paint a dooms day scenario which is sad. It takes a while but the light at the end of the tunnel will get brighter. One more thing, do not become house rich and cash poor. Too many people focus on what their net worth is because of their home's equity meaning buying a home bigger than what they can afford. A smaller home with a ton of money in savings and investments is the way to go. Take it from me, by thinking this way the cost of maintaining a home looks small.

[@767bob]

@@Srode1999 With a house, we have to plan by saving for things to happen. When this is done, then dealing with big repairs that are not covered by insurance will not become a big deal. The main thing to do is to make sure to plan, save and invest. The house is a major part of the plan which becomes less of a big deal as the savings and investments become much greater than the value of the home as the years go by. This is hard to see in the beginning but done correctly, it will all work out. I agree that owning a house is not cheap when repairs have to be made. But believe me, in the long run, it ends up being a lot cheaper than handing cash out that you will never see again for rent. Many years ago a few of my friends did not like the whole thing about owning a home, they sold their homes and as they got close to retirement they had little saved. A mortgage stays fixed while paying off while inflation continues to make the rent go up. I know, taxes and insurance rates go up too but that is also part of the planning when buying a home. Right now for me, with my taxes, insurance and heat/electricity that I pay is nowhere near what the rents are going for now.

[@irisflower9030]

2 kids, currently 39 and will pay off our 375,000 original mortgage loan in 4 years. Also maxing out my 401k ( putting the maximum allowed amount, $19,000 for 2019). There is so much controversy on paying off mtg early vs investing it’s making my head hurt. It’s nice to know Dave’s in the same lane of thinking, although I never employed his money strategy, simply lived within my means and stayed out of debt.

[@thefrozengoat]

Something I really respect about this video is how clearly Dave explains specifically why he believes in paying off a mortgage. While some might disagree he is advocating that you model behavior off of someone successful with proven success, rather than attempting to generate returns on that money that consistently out perform the interest rate on your mortgage.

[@bender3455]

@Cody Neas This is the way.

[@matsonnerby]

I learned the hard way. If you have loans you are not free. As soon as I had my car and house loans paid off, it was so easy to have the extra money to invest.

[@jjuniper274]

I paid over 80k in interest in the past 14 years. 😔Think of what I could have done with 80k!! I am still working on BS 6. Not having a house payment will be WONDERFUL!

[@krillansavillan]

After 14 years, you may have saved up enough to buy your house outright in cash, but you accelerated that timeline to buy it 14 years earlier by using the bank's services. If you had been renting you would have zero equity built up. How much equity do you have vs how much in interest you paid? Tell the whole story

[@erikrohr4396]

@@krillansavillan I agree. A mortgage is a useful financial tool. Go use it to your advantage if you can. There's nothing wrong with a car loan either if the interest rate is reasonable. You'll be driving a car either way, so might as well take money and use it to your advantage

[@denisl2760]

@@erikrohr4396 That's exactly right. If you're afraid of debt you will never get wealthy. Not unless you have a super high paying job. For the rest of us, if cheap loans are available you'd be wise to take advantage of it. No sense in paying off a 3% mortgage when that money could have been used to make 10% returns.

[@ceylontea5877]

How much you would have paid in rent if you rented?

[@ceylontea5877]

Property taxes and insurance still adds to 550/mo

[@TeamProsperity]

Totally debt free including home with $70,000 in the bank 😁 saving about $1,500 per month

[@Masta_E]

Invest that like crazy.

[@jcsfive5670]

Time to hit the mutual funds hard. How old are you?

[@michaelsokolikjr8116]

Congratulations

[@georgieannagomez]

That is awesome!

[@dbryant965]

You're saving in a month what some people bring home in a month.

[@kikinisyun]

I went the other way, instead of paying off my mortgage quickly, I borrowed more money and purchased multiple properties. Now if I sold all my rental properties, I will have enough money to pay off my house and with extra money in my pocket. Not to mention the cash flow I make every month.

[@magicbuskey]

That is a really good point about being able to be flexible with your job. That house can chain you to a desk and take years from your life!!!!

[@anniealexander9616]

Paid off my mortgage back in June. Love being debt free!

[@korswe]

Secured debt is good. Not all debt is bad. Rich get rich with interest arbitrage. Borrow cheaply and invest.

[@kjthomas4553]

@@korswe ain’t no good debt

[@OOICU812]

Could you use a 'companion'? 😉

[@anniealexander9616]

@@korswe I bought my 1st home at 19. During the housing crash, I bought two nice single family homes. I combined both into one mortgage...that I paid off. If we ever have deals that make sense; I'll borrow and invest.

[@exerciseisantidote9337]

Smart girl.

[@grandbuba]

That quote about the grass feeling different under your feet once the house is all paid off, that resonates..

[@peenweinerstien3977]

Paid off two houses and totally debt free, 50 years old and wow does it feel good! thanks Dave Ramsey!!

[@Red_1976]

This is huge, well done 👍🏼

[@peenweinerstien3977]

@@Red_1976 thanks Red76!

[@norsefalconer]

Once debt free, one is able to handle more investment risk without fear of losing everything. As they say, no risk, no reward. I do, however, don't agree with paying off an investment property mortgage. Tenants pay the interest, principal and maintenance (repairs taxes, insurance) at minimum. If real estate values drop, who cares, the tenants have offset that risk. It's great to contribute to your retirement, it's AWESOME when someone else does.

[@calebhartley7192]

This is where I disagree with Dave Ramsey’s philosophy. Put a portion of it on the house and a portion of it in investments. That way you are getting guaranteed return on the debt AND the upside of retirement investments. Diversification is the correct way to address risk not indulging in a house purchase. The millionaires he studied bought houses when rates were above 10%.

[@ericsloan858]

Your investment math only works if you take the 2008 crash and the global pandemics out of the equation. You're making a few extra percentage point on investments with the risk of a major crash/downturn. Pay off the house and then go hog wild!

[@TheEllaTB]

You have seen the study? Where can I take a look at it?

[@jerrydixon3862]

@@ericsloan858 even still, losing your job when you have a 30 year mortgage but lots of money invested in non-retirement accounts in addition to your emergency fund is a much more feasible scenario than losing your job with a 15-year mortgage and no additional investments. Your monthly payment is more and you have less saved. Therefore, more risk.

[@aaront936]

@@ericsloan858 you can't eat a house. You're locking your money away in a non liquid asset.

[@ericsloan858]

@@aaront936 I don't understand that argument. If you are struggling to put food on the table, you are not going to be able to afdord a mortgage payment at all. Freeing up $1500 a month is hedge against life going wrong

[@dvran]

I just want to pay off mortgage for that piece of mind and not relying so much on my employer.

[@HenryPaulThe3rd]

*peace

[@RagnarLothbrok2222]

Peace of mind? Try not paying your property taxes. The state owns us all unfortunately

[@knpstrr]

Property tax can't be avoided. Mortgages can. control the things you can. Better to worry about a property tax bill rather than a property tax bill AND a mortgage. Both will take your house.

[@aolvaar8792]

@@RagnarLothbrok2222 Homestead Act(can't lose a homestead to taxes), and I live in the Largest American city without a property tax. the State may own You. not Us I hear this stated a lot, look up Homestead Act, and file with your State

[@Peter-uo8zr]

A Olvaar Unfortunately, for Californians, it only protects $75k.

[@Bubbasizer]

It took me 7 years to pay my house off, I bought a very inexpensive house that needed a lot of work, but my dad and I did the work. House has been paid off since November of 2015, I I use the extra cash flow each month to invest in a brokerage account each month, I was already making out my IRA.

[@agathacolleen]

I will be forever grateful to you, you changed my entire life and I will continue to preach on your behalf for the whole world to hear you saved me from huge financial debt with just a small investment, thank you Charlotte Miller.

[@mirchimome]

I'm surprised that you just mentioned and recommended Charlotte Miller, I met her at a conference in 2018 and we have been working together ever since.

[@mary_.1peterson]

I just withdrew my profits a week ago, To be honest it was an amazing feeling when the profits hits my wallet I wish I could reinvest but, too much bills

[@stephaniebeddis8069]

I'm new at this, please how can I reach her?

[@agathacolleen]

she's mostly on Instagrams, using the user name

[@agathacolleen]

FXMILLER15 💯.. that's it

[@joelman1989]

What Ramsey is saying is mathematically it makes more sense to invest the before paying off a mortgage of 3.5%. So most CFAs would tell you to let the mortgage ride and invest the money. But most people underestimate the psychological aspects of economics. Paying off housing, though mathematically illogical, nevertheless changes you and is more likely to lead to financial stability in the long term.

[@dr.markevers8331]

If you own your house for the full 30 years and if you don’t have major pullbacks in the market it makes mathematical sense. Poor sequence of returns can ruin the advantage of investing in the market over paying off the house. The other problem with a 30-year mortgage is the amount of interest that is paid in the beginning. If someone sells their house 10 years in, then they essentially rented their house from the bank. Even at current rates (11/23/19) of 3.5%, a whopping 58% of the total P&I payments go towards interest during the first 10 years of that 30-year mortgage. Other factors to consider are down payment and the possibility of paying PMI/MIP early before 20% equity is built.

[@monicarenee7949]

The psychological part is key. Since I wanted to have a house in cash, I worked crazy hard to earn extra money. More than the 10% I could have gotten with investments. I also invested too, but not as much as I saved. I came out pretty well so far.

[@maryrenaud6732]

Totally agree with Dave on paying off the house/condo/townhouse to own where you live free and clear. You never have to worry about foreclosure and living costs are extremely low with no house or rent payment. Even with a modest income we can live a decent middle class life in retirement due to our paid off low overhead condo. I know lots of folks who struggle due to still having a mortgage in retirement. Good advice!!

[@rangerdoc1029]

Only part true. A significant portion of most mortgage payments are taxes & insurance. They never go away. Like health insurance, they've inflated the cost of those two by hiding the cost from the consumer.

[@billwhite5853]

@@rangerdoc1029 if you can't afford the property taxes, than you for sure can't afford the mortgage payment

[@767bob]

@@rangerdoc1029 paying property taxes is still cheaper than paying rent!

[@LetsssGooooooooo]

Don't choose one or the other. Do both at the same time. You can chew gum and walk at the same time. Best part about doing both is that you won't have regrets no matter what happens. "Aw, I wish I'd done ___ instead of ___". Nope, do both at the same time. You'll win.

[@user-qr7ee2cp4y]

If I thought I’d actually invest the money I’d wait to pay off my s with the 4% interest rate but i didn’t trust myself. I took the safe route and paid off my house.

[@jayleenrowe8337]

crypto or stocks

[@missmrpotato]

@@jayleenrowe8337 crypto

[@jayleenrowe8337]

@@onkelzzicke29 how do i earn from crypto trading

[@jayleenrowe8337]

@@onkelzzicke29 how do i reach your trader

[@LefevreSeve1978]

@@onkelzzicke29 I am convinced now to contact her , thank so much you all.

[@enjoythedreamlife5658]

Dave you are a smart guy. It is exactly what I have done over the years. Ive had 2 mortgages in my life on 2 different homes. Paid off one in 6 years the other in 4 years.

[@Red_1976]

This is amazing. I’m trying to pay off my first home & it’s tough being a single parent. Takes double the time but I’m still plugging away.

[@User-pu3lc]

If you took this advice 5 years ago your money saved you 3%-4% in interest rates per year and missed out on annualized 15%-20% growth in the market.

[@marlaknowles2504]

Ok so I just bought my first house and I don't understand this logic. The way I see it, I have two options: 1) Pay off my house now with the $150K I have in the bank. Invest the $670/month that I save by not having a mortgage payment. Assuming an 8% return in the the stock market, in 30 years I have $900K plus I own the house. 2) Invest the $150K now and pay off the house over 30 years. Assuming an 8% return in the stock market, in 30 years I have $1.5M plus I own the house. Why wouldn't I pick option 2?

[@danielwhiddon7054]

I've been on this path awhile and have to agree. Its a better return on the money to keep paying the 670 a month and invest the extra money. There is more risk, and isn't for everyone, but option 2 is the smarter financial path.

[@kvnsns82]

You could also do a mix of them. The market doesn't consistently go up, so it might be advisable to sit some money on the side that you could use to pay toward your mortgage OR invest and then decide which to do based on what the actual market conditions are.

[@marlaknowles2504]

Yeah that's a good idea--and definitely wise to diversify my assets as much as possible. But the idea of putting all my money into the house where it's not generating interest and also not liquid in case of emergency just seems a little illogical. Thanks for the advice, it's good to know I'm not crazy here ;)

[@diferentgames]

He raised this point at the end of the video: More stability, more peace of mind. To some (many? most?) people, that is worth more than money.

[@marlaknowles2504]

@@diferentgames Ok, good point; peace of mind. However, if I put the money into the house, then it's stuck there. If I have some sort of a massive emergency like a health crisis, I'm cash-poor and don't have any ability to handle the situation short of refinancing my house or taking out high-interest emergency loans. However if that money is in the stock market, it is far more liquid. I know it's not ideal to pull out of the stock market (and if it's down or in recession at the time, it's obviously a pretty bad option), but the money is available in an emergency in a way that home equity is not. Not to mention I have the peace of mind of knowing I *could* pay off my house if I needed to. If I lose my job, I can continue making house payments (as well as taxes and insurance) for decades without worrying about missing a payment. I'd say I have far more peace of mind knowing I have $150K+ in (semi) liquid assets at any given time.

[@sacstaterEVOLution]

This is the best thing I ever saw. Ramsey is a gift, brothers and sisters.

[@RealAmarSheth]

Cedric Steven Irving so true. He’s a blessing to us all 🙏🏼 So much wisdom in this advice. Grateful for it.

[@bardbacx]

Yep, good stuff

[@rubena7674]

Changing lives!

[@danidtv5823]

I totally agree. I was struggling with this decision and he just helped me seal the deal.

[@sacstaterEVOLution]

@@danidtv5823 Can't lie with the results. His research reflects the psychological difference 'everyday millionilaires' develop practicing his principles. I wish I could get a scholarship...

[@anniesshenanigans3815]

I will give a scenario. Then you decide. In 2 years my house will be paid off if everything goes as planned. At that point I can take SS and have a fully paid for home and not worry about foreclosure. Yes I can keep working IF I WANT TO. If I do not pay off my house, and invest instead, I MIGHT have a good amount of cash invested, but I MUST keep working because I still have that huge mortgage. See the difference?? Go to 3:36 for his answer.

[@lisatowe778]

Paid off a few houses one in my 30s one in my 40s. Unfortunately I didn’t hold onto either of those and that’s not the best plan Pay your house off and keep it I hated my job each time and let that sway me into selling my house. Bad planning in life

[@thomasbaldwin6627]

Dave, you always recommend paying off your mortgage over investing. Please give an example where you break down the numbers. I have run mortgage and compound interest calculators, and can't find the way this makes sense. Aside from taking your word, the numbers don't add up. Thank you

[@aaront936]

Because it doesn't make sense. Dave gives terrible investment advice.

[@loristrahan832]

Dave is clear, it is not about math. It is about peace of mind and emotional health!

[@consumerdebtchitchat]

Paid off my condo mortgage this week. Purchased half of what I could afford and picked up a second job to complete mortgage in 2.5 years. Don't care what I could have made investing the money. This was the way to do it. And now it's 30% a month into retirement and that's after HOA, taxes and insurance are calculated.

[@susannicky]

investment requires good experience and knowledge to carry out a good and successful trade, I have lost a lot trying to trade all by myselfMay I ask which investments are good? I've been looking at a few different ones but want others' opinions as well.

[@graywilliams_77.]

how do I get in touch with the adviser i really need a help..

[@ButcherBird-FW190D]

@walter_brown413 Jenny Canaya cost me every penny I was worth. Avoid her like the plague.

[@darbyohara]

No it doesn’t. Put the money in an index fund

[@galupproperties3098]

I’m paying off my first rental property at the age of 27 this may. Sure it wasn’t a huge mortgage at 53k but I’m writing the final check this summer for 26k. I know people say to invest but I feel I’ll sleep better at night knowing I won’t have to carry a mortgage during turnover.

[@FXCartel]

That's some nice going.

[@Red_1976]

Awesome. I like your way of thinking 🌈

[@rtjeff83]

We paid off our (duplex) home in August. What a great feeling pulling into the drive knowing we have no mortgage. Interestingly enough some "experts" advised us not to pay off mortgage and instead use money other ways. But in our gut we knew we needed to do this and we have no regrets.

[@ananditagangwar9988]

Yeah, the "experts" understand basic math. You dont.

[@QQQBall]

First of all, the yield on the principal reduction is greater than the IR on the mortgage. Years ago, I calc'ed mine and I got 9% on a 7% mortgage interest rate. Teh balance reduces but the base payment stays the same. After a while, it really starts to really eat away at the balance. Another point is, once you pay the casa off, you will be hesitant to take on another 30-year debt commitment. Once you house is paid off, life gets easier.

[@Omikoshi78]

Ramsey’s advice is based on psychology, less on math. Good advice if you’re horrible with money. Subpar advice if you’re trying to maximize wealth.

[@AndrewLitton]

Yeah, i don't understand. For example, if you can make a 10% return on stocks vs losing 3.5% on your mortgage, I'd rather invest and pay off the house less. Keep in mind this is an oversimplification that doesn't include PMI but i'd think that's minimal. Property taxes, and insurance shouldn't be factored in as they're charged regardless of if you're home is paid off or not.

[@pmbarro]

I was having this exact thought. For example, my mentality is to pay off real estate investments over my own private mortgage. Why? Well I bought and paid off a duplex that's generating income for me for the rest of my life and that investment is paying off my private mortgage eventually. Also, if I buy cash other investments/ real estate, they can also help with my living expenses. These are income generating investments, not liabilities like a private home.

[@Mathis218337]

Yeah most people are not good with money though. That’s why they watch this show or call in lol

[@1871kwame1]

👏🏾👏🏾 it’s interesting to see different mindsets .. a person seeking future wealth beyond after mortgage is not going to pay down his mortgage but rather TAKE the risk and invest .. flip side the person that just wants to be mortgage free pay down their mortgage but then what happens are that ? Still not much wealth you have built up .. option are low as you would have to save again .. mostly likely still be working .. Equity is stuck in the house (no liquid funds)

[@matthewlangley3524]

The variable that no one on this thread is considering is the individual person's price in perceived risk. Your stocks make an average 10% return. That's nice. What happens if they don't? That house gets paid off, it will always be paid off.

[@kaitlyncranwick]

Back in the day, when I purchased my first home to live-in; that was Miami in the early 1990s, first mortgages with rates of 8 to 9% and 9% to 10% were typical. People will have to accept the possibility that we won't ever return to 3%. If sellers must sell, home prices will have to decline, and lower evaluations will follow. Pretty sure I'm not alone in my chain of thoughts.

[@maryHenokNft]

If anything, it'll get worse. Very soon, affordable housing will no longer be affordable. So anything anyone want to do, I will advise they do it now because the prices today will look like dips tomorrow. Until the Fed clamps down even further, I think we're going to see hysteria due to rampant inflation. You can't halfway rip the band-aid off.

[@hunter-bourke21]

Home prices will come down eventually, but for now; get your money (as much as you can) out of the housing market and get into the financial markets or gold. The new mortgage rates are crazy, add to that the recession and the fact that mortgage guidelines are getting more difficult. Home prices will need to fall by a minimum of 40% (more like 50%) before the market normalizes.If you are in cross roads or need sincere advise on the best moves to take now its best you seek an independent advisor who knows about the financial markets.

[@maggysterling33254]

@@hunter-bourke21Kudos on the effective execution of innovative ideas and tactics that lead to significant advancement. As I seek guidance from a trustworthy advisor, would you be willing to share details about the individual assisting you?

[@maggysterling33254]

@@hunter-bourke21bravo! I appreciate the implementation of ideas and strategies that result to unmeasurable progress, thus the search for a reputable advisor, mind sharing info of this person guiding you please?

[@hunter-bourke21]

The decision on when to pick an Adviser is a very personal one. I take guidance from *Gertrude Margaret Quinto* to meet my growth goals and avoid mistakes, she's well-qualified and her page can be easily found on the net.

[@janiecel]

His final points are good. We want to pay ours off so we don’t have to stay in jobs we that stress us out when we’re 40.

[@raymondblake5765]

Ramsey uses bad math and bad logic when he cites his millionaire study. He essentially says: "85 percent of millionaires paid off their house quickly, therefore paying off your house quickly increases your chances of becoming a millionaire" First off, at the very least he should survey the population of people who paid off their house early, millionaire or not, to see what percentage of those people become millionaires. Then, say he finds that "85 percent of people who pay off their house early become millionaires", he could at least say that "paying off your house early means there is a good chance that you become a millionaire". But he can't even say that with the current study because he is not sampling all the people who pay their house off early. The second problem with the way he talks about the study is that even if he finds a correlation between paying off your house early and being a millionaire (which he doesn't because of the flawed design explained in the preceeding paragraph), correlation does not necessarily mean causation. Perhaps another factor, such as being financially prudent and having a good income leads to both millionaire status and paying off your mortgage early. And the real problem is he may be right, that given the risk-profile of carrying a mortgage and the psychological effects of paying it off mean that it is sage advice to attack your mortgage aggressively-- but his flawed reasoning perpetuates poor mathematical, logical and scientific thinking.

[@2014kaydee]

I get math and why some people prefer to invest rather than paying off the house earlier. I personally sleep better at night and have less anxiety paying off the house early. My house will be paid off in three years and I'll be 30. Plenty of time to invest aggressively over the next 20-30 years. On top of that I can be a stay at home mom at 30 since I don't have a mortgage

[@barvdw]

I understand your peace of mind argument, but I don't see my investments (other than tax-specific retirement funds or college funds) as something I can't touch. If sh*t hits the fan, I can sell some of that stock to pay off my mortgage in an emergency, most assets you can sell in a matter of days. Having that money in investments gives me the same peace of mind to be able to pay off my mortgage. Yes, stocks and funds fluctuate, but there has been a housing bubble before, and at least in some areas, I can't believe those prices are tenable long-term. But as long as you stay within your means, I don't think there's a really bad decision to make here.

[@scottarmstrong11]

Banks are selling mortgages. People always say it's a good option to buy at discount, but with the market turmoil and everything at stake in present economy, I'm thinking of buying stable coin to hedge against inflation, or is it all right saving over 350k ?

[@emiliabucks33]

There are options that spread across multiple banks. I use a non-beginner broker that protest up to 3 million dollars and provide 4.58% returns on cash, it's always a good idea to consider working with an advisor for financial planning

[@MarkGrimm8]

Agreed, financial advisors play a key role in portfolio allocation and i've been using one since late 2019 just before rona outbreak. So far, I'm barely 25% short of $1m ballpark goal after subsequent investments.

[@carolpaige2]

@@MarkGrimm8 please excuse my curiosity, would you mind sharing more info on your advisor? I’m in dire need of guidance

[@carolpaige2]

Benevolence, this reference seems valid.. Just inputted her full name on my browser and found her site without sweat, 20 years of experience is certainly striking! very much appreciate it

[@FXPhysics]

A paid for house won't just allow you to cut off your risk, it will also allow you to undertake riskier endeavors that you would not have taken up otherwise. That's the beauty of it.

[@crand20033]

But you still have a monthly payment for taxes and insurance. So what's the advantage? Plus you may want a better house later and go back into debt.

[@ScottJ_Moses]

@@crand20033 The advantage is way more margin and peace of mind.

[@767bob]

@@crand20033 the advantage is that most home owners that are dept free end up with a net worth 10x greater than someone who does not own a home.

[@josebohorquez2633]

This is the way I think. Some poeple dont need to hear it from the experts. I work in the mining industry in Australia. The guys buy brand new cars, boats or spend lots of money going out. Meanwhile me I just put everything in the Morgage. I have 4 more years to go. It is hard mentally but the feeling of stepping in a place that nobody can take from you, would be amazing. Later on I want to pursue business adventures but as he said. I need that peace of mind to know that everything is under control.

[@everythingzone]

To sum it up - purely economically it's not the best decision, but psychologically it can give you an advtange that translate to a economically good decision.

[@Srode1999]

That just means you are psychologically efficient. Ignoring mathematical truth for a false peaceful feeling is harmful. Though to be fair, the decision largely depends on the interest rate of the mortgage.

[@landondc4739]

Ignoring the fact that money isn’t real and no amount of math can save you from your own Zimbabwean event… buy dirt.

[@davidsjelin1739]

I disagree with paying off your mortgage early, probably most millionaire homes are paid off is because most millionaires have been working for more than 30 years so they probably just paid off their house at a normal mortgage rate and used their excess money to investments much higher compounding return than the money paying you save by paying off a low interest mortgage that is baredly higher than inflation. Inflation is 2-3%, if you have a mortgage close to that, it's basically free money.

[@adventureswithanneattimele4457]

i don’t know, if you’re putting extra payments on then you’re saving yourself interest and decreasing the term

[@jtowensbyiii6018]

@@adventureswithanneattimele4457 you can't save yourself rich

[@bradwilliams4921]

This caller has his act together.

[@Musicienne-DAB1995]

A real, solid guy. Must be a great father, saving up all that cash for his kids.

[@LesCunliffe]

I wish I was that smart with money! He's doing amazing!

[@patrickocallaghan612]

“Recasting” the loan is the answer here. Interest rate and length of loan stay the same. Throw the lump sum at it and the mortgage company will recalculate your monthly payment based on what is remaining. It’s free for most mortgage companies but few people know about recasting. Saved me a lot of money in interest & helped me pay it off quickly.

[@PaulRizzo504]

Easiest reason to listen to this advice. In a recession or job loss what is the first thing you have trouble paying. The biggest expense is rent unless you take out more credit cards then your rent. Paid off my house at 35 and I promise you I have never felt so rich.

[@Red_1976]

Well done. I’m trying to do the same. Security & peice of mind is paramount

[@pgbollwerk]

So I did some math regarding paying extra toward mortgage principle vs investing the money in a mutual fund that returns an average of 9% (e.g. like an S&P 500 index fund). Over 30 years, it's a HUGE difference. Much more money made with the mutual fund that if you pay off the mortgage early, then invest it. $1000/mo over 30 years = $1.7 million (1.3 mil pure profit) $3500/mo over 14 years = $1.1 million (550k pure profit) (numbers are based on my $2500/mo mortgage, incl insurance and property taxes)

[@SeniorNI]

He don’t like anything above 15 year mortgage to begin with. Should do the study over 15 years. Compounding assumes no withdrawal or spending I get the math works with 30 years is a long time to be disciplined even 15 years is

[@MyComedyStore]

30 year mortgage at 2.3% should never be paid off early. It all depends on your interest rate. 3% or less is like free money especially when you include the interest tax deduction.

[@RalphNorton-x9p]

KZbin search his videos on mortgage interest tax deduction, and really listen to them

[@GTRrocker84]

I just paid off my car, so I can only imagine the peace of mind of paying off a house and never having any debt ever again.

[@jacobmoreno6339]

Dave Ramsey would hang up on me. I buy a house, have a mortgage, then move and rent out the house and have a tenant pay the mortgage.. I've done this a few times over and have hundreds of thousands in equity. Of course there's some risk, but the cash flow more than covers any of my fears. Paying off one house won't let you retire early without a lot of aggressive investing for years after it's paid off.

[@WW-he9mz]

I agree. I have done the same. Mortgage is a great debt to have because of the low interest rate. It is foolish to pay it off so quickly when the excess cash can be invested elsewhere for higher returns, so long as you have sufficient emergency cash.

[@TheEllaTB]

He probably wouldn't hang up but he'd probably laugh. Remember he used to do that? That's how he ended up bankrupt. The truth is, such a method has left many by the way side, but the method he promotes now has not led anyone to bankruptcy. It's about which method will most likely provide you with a stable future

[@JMichael2x2]

Great advice from Dave. As long as you owe one dollar on your mortgage, the property is not yours. We appear headed into troubling economic times that might make 2008 look like a booming year. People these days don’t know what it looks and feels like to see income and wealth disappear - when scraping up $500 is nearly impossible.

[@eatanelkberger]

This is great advice for those with debt problems or who cannot afford much risk. However, we are all in different situations. If you don't have dependent children and are doing very well, then this may not be the best way to accumulate wealth and will not give you anywhere near the best returns. The more risk you take, the higher your potential payback. During a time of high inflation, with money printing maniacs controlling the money supply, it makes a lot of sense to have a 3% loan that is paid back with inflated dollars, while earning some serious returns with certain assets. So, depending on your exact situation, assuming more risk could be a good idea.

[@jeffkline9191]

I didn't know about baby steps but we first paid off house then started 529. It worked good for us because we put what our house payment was into 529 for 10 years.

[@monicarenee7949]

This is similar to what I’m doing now. Paid off house allowed me to pay more on a 529 when our child was born. She won’t have to worry about any college debt and will always have a house to live in.

[@austinbuck8108]

Nah, the interest rate on my house is less than the inflation rate. My mortgage is low enough that in an economic downturn, I can always pay my mortgage. The fun spending would go. Dave gives behavioral advice, not financial advice.

[@johnsmith-vz4rh]

so the people that paid off their home in 2006 were pumped to see the value decrease 50% and have zero liquidity. plus they lost the tax write off. Buffett says home mortgages are great. You lock in a rate. if rates go up you benefit from having a lower rate. if rates go down, you can refinance. Get a tax write off and invest the difference. Why put all your eggs in one basket (real estate). There are many ways to get rich. paying off your house first is not the only way. I don't believe his "study" either.

[@alexlewis8143]

john smith why would you want to be paying a payment to other people longer? If you lose your job god forbid you could lose your house because the bank doesn't care about you. If you loose your job you can make due at macdonalds if your house is paid for until you get something better. That's why to be debt free to be free.

[@krukov100]

Alex Lewis don't you even dare to bother explaining. Please, let people pay off 3% mortgages fast. Please do !

[@johnsmith-vz4rh]

@@alexlewis8143 I would not call working at McDonalds free.

[@johnsmith-vz4rh]

@@alexlewis8143 and if i lose my job I will have money in equities I can tap if needed.

[@michaeln2386]

Tax write off? Purposefully borrow money so you can pay less taxes? Looking at an amortization schedule on a 30 year mortgage is enough to make me reach for an air sick bag.

[@claytonlynch6288]

It’s funny because I follow Dave religiously so the answers to these questions are always fairly expected, what probably makes this entertaining moving forward is hearing what others are up to or up against and having an open place to dialogue about finances which is unfortunately a taboo topic in this country

[@jeanlaubenthal698]

It keeps me it present and on the ball.

[@jordanodonnell7807]

I had 2M and i chose to invest 8nstead of pay my house off. Now i have over 10M, my house is paid off, and i could live off of just dividends if i wanted to. Do some due dilligence. Invest in some great stocks. And youll be rich in a few years.

[@maxcarter3413]

Oh Dave, you are the best! I will give back the cheapest mortgage money I will ever see again in my lifetime so that I can tie up a large portion of networth in my home during retirement. That will insure my financial safety net because no one will ever take my home unless, of course, I can't pay my taxes due to medical bills or other unforseen circumstances. In that case, I will just sell my home to get the cash out and live in a tiny apartment since I would be physically disabled from taking care of the house and couldn't pay to get hired help since all my money would be tied up in the house anyway. I could even get a reverse mortgage. I heard they are fair deals. My children can't use my wealth anyway and why should they get it when I earned it? My wealth should go to a banker, it is only the right thing. Oh Dave. Thank you. Thank you. You are just the most important financial adviser. I love, love, love you so much!

[@ScopeMR1]

I’m planning on paying off my home in the next 3 years. I just paid out my 24,000 car loan in 1 year 4 months

[@billgateskilledmyuncle23]

Making what a year? Did you scrimp and save, or was it rather easy?

[@mellojohnson5844]

Wow what a coincidence am paying off my car next year and planning on paying off my house in 3 years wow am happy I came across your comment as it validates what I was planning

[@beakiller25]

How do you pay a 24k loan in less than 2 years, are you using a specific method or just earning a lot more money?

[@laprepper]

With all due respect is there any particular reason you needed a $24,000 car

[@aaront936]

@@laprepper go be poor somewhere else what difference is it to you what car he drives?

[@JimmyLevin-q1m]

With many howeowners having locked in and re-financed their homes at interest rates below 3% for 30 years a few years back, this 'baby step' of paying off the mortgage as early as possible, doesn't really make sense for this group any longer. Only the interest rate at a high yield savings account is already higher currently (~4.5%), plus you get mortgage interest reduction from IRS.

[@CheveraChino]

Why pay off my mortgage, lose my liquid cash, when: A: I have a tenant paying it for me and B: 2008 could happen again and you lose all your money and have none to deploy to buy distress assets?

[@jerel42]

I think your decision is reasonable, but so is Dave's recommendation. His recommendation is for paying off the mortgage in the home you live in, not an investment property. Now, you talk about risk if 2008 was to happen again and you were to lose out on an opportunity? But there is a lot more risk in renting, and it is more likely to happen, too. What happens if your tenant can't pay for some reason? What happens if you can't get another renter or need to lower your rent? What happens if they wreck the house and you have to pay $50k to fix it back up? Etc. When investing, you have to compare rate of return to risk. Let's say you have a 4% loan. When you pay it off, it is virtually 100% risk free -- that's a great return on a risk-free investment. Or, you can choose to invest that money for a higher return but a higher risk somewhere else, and that is your call. But that's Dave's point. 4% pure risk free is a great ROI. If you really want more liquid cash, you get that by saving up after paying off that mortgage. Or, if it's already payed off, you could refi it or get a line of credit, but Dave would slap you if you did that. :) Finally, as Dave points out, if paying 4% on one loan, but then investing money at a higher rate is so great, then you should be refinancing your property -- in other words using leverage -- to invest everything you can at that higher rate. But you aren't doing that, right? Why not? Too risky? Think about your logic then. Still in the final analysis, it's your money to do what you believe is right, and I don't think that your logic is that bad. I had to make the same decision, and have decided to pay off my home first. But it was a hard decision. :)

[@mathewhiscock7986]

David Suen David Suen David Suen I mean, paying off your house is never a bad thing but this isn’t advice that I would follow. There are certainly more efficient ways to leverage that money. Now that said, there is defiantly something to be said about paying off your house from an emotional stability standpoint like Dave mentioned at 6:05. Also, if you’re choosing between paying off your house or just wasting the money, paying off the house is defiantly better. But, that said, I think that at my young age l would ignore this advice and choose the option that allows me to leverage my money the most. I think Dave is incorrect in assuming that just because a lot of people do a certain thing that it is the best option mathematically because assuming a fixed 30 year morgagage, it’s usually mathematically better to leverage your money else where.

[@pederstrand8349]

However, the money you're not putting into a mortgage will now be freed up to do your investing.

[@CheveraChino]

@@pederstrand8349 LOL - This crash makes investing fun! Everything is on sale!

[@MeltingRubberZ28]

When you pay off your mortgage and lose your liquid cash....and your tenant is paying you ~$1000/mo that now is purely "profit/savings"

[@mikestevens2053]

I can't agree enough: When you don't have debt and live in a paid off house, it changes the way you carry yourself financially. It even changes how you make financial decisions. Hard to explain, but very powerful. The best I can put it is, that you stop making decisions based on expediency, and begin making decisions based on what you know is right. Example: you no longer "need" a particular job, so you gain confidence and expect better employment conditions, which you end up getting. You're able to walk away, therefore you don't end up having to. Powerful stuff!

[@DaveM-FFB]

You're still gonna need income for property taxes, home insurance, maintenance, upkeep, utilities, etc. All that extra savings sitting stagnant in home equity won't generate any cashflow, and won't multiply itself.

[@tomv7986]

I got really frustrated living in a very expensive city. Housing prices went up by 35% this year. Mortgage rate 7%+ I can do a 35% down payment on a home, but I am thinking about moving to a city an hour away. Its around 40% cheaper there. I want a place to live that is paid off asap.

[@motorcyclemichael2182]

This 35 year old is killing it...their large income helps Im 45 and no where near where he’s at...but also have household income of under $100k

[@lucasday7330]

I'm 29. House hold income of 160k. Cant figure out how he can afford a 550k house on his income without being house poor. Like not sure how he got a loan in the first place.