Recently, I was listening to the radio and happened to catch a segment on famed personal finance guru Dave Ramsey. He was trying to help a couple who were drastically overdrawn on their credit cards. The couple tearfully admitted that they had funded a lot of their “wants” and not their “needs” on credit and were near bankruptcy. Ramsey immediately launched into his “Total Money Makeover” speech about how they need to concentrate on a few things in order to climb out of debt. He mentioned the 7 steps that he has famously touted over the years as the way to financial freedom. I won’t go into them here but if you want more info, you can click here. I have talked before about how people like Suze Orman and others have done some dubious financial things but that still doesn’t stop them from having tons of followers. Does this mean that their advice is good?
I don’t personally listen much to any of the famous financial advisors. I find their information not very helpful and I have always had better luck making my own plan that works for me. That is not to say that these advisors are not helping other people. People like Suze Orman and Dave Ramsey have gathered legions of fans that have helped propel them the the forefront of the financial world. Many people find their advice helpful and I don’t want to begrudge that. I do wonder about some of their advice especially Dave Ramsey. For example, I don’t get the whole paying down the smallest balance on your credit card thing when it make more fiscal sense to pay down the balance with the highest interest. Thats just me. I understand that there is a psychological component there but still. I also personally think you should save more than $1,000 in an emergency account even if you have debt. Heck, a car repair can wipe all that out in an instant. I personally would not feel that comfortable having so little in the bank. I think there is something to be said about having peace of mind with your money but that could be just me.
I am a fan of his desire to help others but that cannot be done before you help yourself. Too many people get caught up in helping those who need help but then forget that they need a lifeline as well. That can be something sad to see but it happens all the time.
Like always, proper research is needed to determine what is best for your finances. Make sure to always do your homework.