Elimination of Debt Experts

Dave Ramsey

Dave Ramsey is probably the most famous personal finance expert of the middle class. He is the author of the book that got me started on my journey to financial peace — The Total Money Makeover. The teachings in his book were an inspiration to me, because the stories were about everyday people overcoming the very same predicament that we were in.

Because I had a lot of consumer debt, Dave’s tough love persona resonated with me. Dave is against the use of all debt except the 15-year mortgage. So he fit my 2008 situation well. We did on-and-off “gazelle intensity” for 54 months. (Gazelle intensity is Dave’s term for busting ass to get out of debt.)

If you will live like no one else, later you can live like no one else. - Dave Ramsey Share on X

Ramit Sethi

As our financial situation improved, I started to read other personal finance experts. Ramit Sethi has been on as many news programs as Dave Ramsey. He made a lot of sense, but his book sounded hokey — I Will Teach You To Be Rich.

Although Ramit warns against consumer debt, he also talks about what he calls “money dials.” These are the things that get us jazzed about spending. His advice is to spend lavishly in our money dial areas, but to cut mercilessly everywhere else.

His investment advice is closer to what I was already doing. Where Dave encourages listeners to contact his “endorse local providers,” Ramit says to invest in index funds through a place like Vanguard, Fidelity, Schwab, etc. They are low cost and more reliable than professionals. We do Vanguard and Fidelity.

Until I started studying investments, I did not realize that about 80% of professional money managers fail to even match the market, much less beat it. And if they do beat it, it’s not pervasive and consistent. (There are exceptions like Peter Lynch and Warren Buffett.) I figured why pay up to 2% to a money manager when I can beat 80% of them any given year with a 0.03% expense ratio index fund. Over the decades, professional money managers fees can mean tens of thousands of dollars NOT growing your nestegg.

Brian Preston

This is probably my favorite guru right now. His business, Abound Wealth, is a fee-for-services investment advisor with a terrific YouTube channel called The Money Guy Show. His co-host (and business partner) is another great guy named Bo Hanson. He is also an investment advisor.

Brian’s Financial Order of Operations (FOO for short) is similar to Dave Ramsey’s Baby Steps. However, it modifies the Baby Steps the same way that my wife and I did. As a math teacher, order of operations caught my attention. I read up, and his modifications made sense to me.

For example, don’t leave free money on the table! That is, get your employer’s match for the 401(k) or 403(b). My wife’s employer matches 50% up to 6%. That means that when she invests 6%, her employer invests 3%. That’s an instant 50% return on investment. We didn’t have any credit cards that were anywheres near 50% and neither does anyone else!

J.L. Collins

Jim Collins wrote another one of my recent favorites — The Simple Path to Wealth. Jim’s story is that he wrote his book for his daughter, so that she would know what to do with her money. His advice is the tagline I use in my closing — Live on less than you earn, invest the surplus, and avoid debt.

Jim is part of the FIRE movement. FIRE is short for Financial Independence Retire Early. His promotes investing as much as 50% of your income in order to get there fast. This book also talks about F-U money, which is like Dave Ramsey’s pinnacle point. This is when our investments earn more for us than we earn from our job. The F-U is a tongue-in-cheek expression for quitting your job.

Finally, Jim Collins advises investing in low cost index funds. He loves (and mentions often) my favorite fund, VTSAX. That’s Vanguard’s total US stock market index fund. Owning this fund means that you own all 3900+ stocks that are publicly traded in the US.

Debt Lovers

I would like to write another post focusing on whales like Robert Kiyosaki and Garrett Gunderson. I have read both their books. They are a different look at finances than the four people above. Although, a lot of their views may not pertain to the “middle class,” it’s always good to learn all about finances. So we’ll see.

As Always…

Thanks for reading! I hope this information provides food for thought. Remember that I am not a certified financial planner, a certified public accountant, a licensed real estate agent, etc. My content is for educational purposes. I am a math educator who happens to have a finance degree. Like they say, never take financial advice from a math teacher! (Do they really say that?)

But you should spend less than you earn, invest the difference, and stay out of debt!

I would so appreciate your sharing my content with anyone you feel could benefit. And if you would like a free exploratory conversation or just want to shoot the breeze about personal finances, call me and leave a message or send a text to 570-731-0425.