Dave Ramsey has been passionately preaching financial advice to Americans for decades, but younger generations are now listening to advice that the white-bearded radio host doesn't fully explain the current cost of living crisis. He is accused of providing the information.
One frothy example is Ramsay's vocal abandonment of his daily coffee joe. In a 2021 blog post, he claimed that his coffee habit could be costing him $766 a year, money that should be used to pay off student loans, invest, or even buy airline tickets. suggests.
Do not miss it
But young Americans say they'd rather hold on to the small luxuries that maintain their mental health and bring them joy than save a few extra bucks.
“Self-care is so important, and if that means buying a $6 cup of coffee every day, do it,” Jarrod Benson, a 32-year-old comedian from Orlando, Florida, told Business Insider.
“I'd rather have some caffeine than be depressed over $6.”
Social media users despise Ramsey's advice
The hashtag #daveramseywouldntapprove has been viewed about 67 million times on TikTok, with many users posting videos criticizing financial figures who are out of touch with reality and shamed for their money habits.
Benson, for example, isn't shy about jumping on the bandwagon with his own content, drinking cold Pumpkin Cream beers and grabbing $4 crumble cookies before doing a Ramsey impersonation to menace him from afar. I showed him how to do it.
Ramsey's advice, which often includes living frugally or taking on more jobs to increase your income, clearly doesn't resonate with younger listeners.
In a recent TikTok, Kate Hyndman, 31, an administrative assistant from Pasadena, California, emphasized that her mental health and quality of life are far more important to her.
“I don't feel like doing it. anything It’s about getting out of debt,” she says. “I don't want to eat rice and beans every day, and I don't want to work three jobs and spend time with my kids. I don't want to forget my favorite salad on Friday.”
Hyndman explains that the bills are so high that saving a little extra cash here and there won't significantly reduce your debt.
“The cost of living and low wages are the cause of most Americans' economic hardship,” she says. “It's ridiculous to be told that by just giving up your quality of life for five or 10 years, you can gradually make big changes.”
read more: Wealthy young Americans are losing faith in the stock market and betting on these three assets instead.Take advantage of strong long-term tailwinds now
Ramsey's financial advice isn't always correct
Hindman decided to turn $30,000 in credit card debt into a debt consolidation loan with an 8% interest rate. Ramsey famously dislikes this strategy, which he claims is actually ineffective.
Of course, as with any debt resolution hack, it depends. Keeping track of multiple credit cards at the same time can be more difficult than paying one bill each month. Additionally, if you can secure a lower interest rate on your loan than what you were struggling with on your credit card, it could be a great opportunity to save you hundreds or thousands of dollars in debt over the long term.
On the other hand, new loans may come with additional costs, such as prepayment penalties and late fees.
However, Ramsey's own recommendation is the snowball method, where people pay off their smallest debts (or accounts with the lowest balances) first, and then make only minimum payments on all other outstanding debts. may not be the right solution either.
This method may provide an incentive to continue taking action, but it may end up costing you more interest and taking longer to clear the debt compared to cracking down on high-interest debt first. there is.
“Dave Ramsey would say, 'I don't care if it's cheapest to pay off the highest-interest debt first, because it's more expensive if you give up on it,'” Wall said. told Street Journal. “I think the jury is out on that.”
What to read next
This article is for information only and should not be construed as advice. PROVIDED WITHOUT WARRANTY OF ANY KIND.
