Hi everyone, I'm a business owner. I've been looking for some guidance on how to invest my money wisely and plan for my retirement.

As a dentist, I didn’t really appreciate the analogy. In my office I tell plenty of patients that they are perfectly healthy and don’t need any work. I’ve had patients ask me to do work I didn’t believe they needed and talked them out of it.

Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got to talking about investment and money. I started investing with $150k and in the first 2 months, my portfolio was reading $274,800. Crazy right!, I decided to reinvest my profit and get more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family.

The caller - Hey Dave I was doing what you said - then I talked to someone that suggested I do something else - do you think I should do what you said or what they said ? Dave- yeah I’m gonna say do what I said . The caller - ok Dave that clears things up I appreciate it

The cavity analogy isn’t a very good one. If you have cavities, you should definitely get those filled.

My financial advisor is the first company Dave ever endorsed...about 20 years ago. My advisor has me on Dave's plan and I feel as though I will be ready to live an amazing retirement in 20 years and pass on generational wealth...as well as the future generations seeing what I did and how they can do it. I did ask my Ramsey approved advisor if I should stop paying extra on my house and invest more of it with them. I was told NO! Keep on making that extra principal payment each month and just doing the max Roth IRA with them...even though history says they can make me more than my home interest rate. I respected that advice. I have no doubt they have my best interest at heart.

as a financial advisor i agree with this advice dave said. its gives the client a piece of mind thats un-matched.

When my father in law passed away, within a week my mother in law had a financial guy trying to convince her to take out a mortgage on her 450 acre farm that’s PAID OFF, and hand over the money to his “investment firm”. She told me the man was “very sympathetic” and a self-professed “Christian”. Thankfully she thought better at the moment, and then sought financial guidance from a Ramsey endorsed financial adviser. THANK YOU FOR YOUR SERVICE!! The thought of a slimy investment guy trying to pressure her into an immediate decision at the lowest point in her life makes me so angry I wish I knew his name and address.

I love how Dave put clarity on the room full of smoke and mirrors!

I just saw a video where Warren Buffett himself said he doesn't leverage Berkshire because he has seen too many intelligent people get burned by leverage. If Warren Buffett is saying stay out of debt, that means you stay out of debt.

Listen to Dave!!!!!

Peace of mind is everything.

Years ago while still working I had a conversation about retirement and how much to save for it with a fellow worker. I ran the numbers, (am nerdy about math and money) for him and he saw himself he was not saving enough and knew how much more he needed. He was in his mid thirties. I may have saved him from disappointment years in the future long after I am gone. That gave me a good feeling.

Just for the record...I've talked to some smartvestor pros (if you sign up on the Ramsey website, you'll get a lot of calls). They absolutely are not 100% aligned with Dave. I've talked about the paying off a home idea and they were basically like, "weellllllllll...that's one way you could go, but you could make more money in the market...it's up to you, but I wouldn't do it." Something to that effect.

When evaluating the advice of a financial advisor, it is absolutely essential for the client to understand the term, "assets under management". For most advisors, those three words determine how much money THEY make...off of your money. How much of your money would they like to get, as "assets under management"? All of it, and then some. Because it is in their best interests, their advice will almost always be for you to put more of your assets under their management, so they make more money.

Dave, not only you're a smart guy, but you also funny. I Love listening to you brother.

At 60 you definitely should not have students loans. You also shouldn’t have a mortgage at that point.

The only financial advisers you should listen to are fee-based fiduciaries. A fiduciary is legally obligated to work in your best interest. If they aren’t a fiduciary, they have no legal obligation to put your interests over their own. Having said that, most people don’t need a financial advisor. Investing wisely is not difficult if you do a little research. You can do pretty well just sticking with low fee index funds.

All signs suggest that 2023 will be a year of severe economic pain. I was really hopeful of my investments this year, but all my plans have been disoriented, I've been studying the market crashes and I realized some investors made millions from the recent 2008 recession and I was wondering if such success rate could be achieved in this present market. Any recommendations?

You are right I have noticed the same thing

Doesn’t really matter what she does between taking 2 years to pay off the loan while making $7,500 contributions to the IRA or waiting a year to invest $15k with 1/2 of it being tax advantaged. Advisor is favoring investing sooner given her age, tax treatment, math, etc. Probably fee for service given the dollars involved. No need to malign the advisor without knowing the full arrangement.

Figure out how much money the debt service is for a loan. Then calculate the amount of money you would need to generate the safe withdraw to service the debt. You will found out it takes less money to just pay it off. That is as good as saving that money.

Have an ELP that gave me the same advice regarding my mortgage.

I think ppl have to remember that what Dave teaches is the principle of staying out of debt as much as possible. The behavior and comfort of debt is what really keeps people in debt, not the math alone. He always admits that. For example debt consolidation vs the snowball method. Mathematically, debt consolidation usually always makes more sense, but statistically, people are more successful paying off debt using the snowball method because of the mental boost of paying off small cards first.

All I do is watch these videos on repeat, love your language and transparency. As I continue to build my financial planning practice, I look through your show for guidance! I took the non-fee based, fiduciary, free financial planning approach and signed with my company to spread financial literacy like yourself! Hope to be you one day haha!

This is one of the few times where debt is good. Her interest rate is 4.25%, but T-Bills return 5.25% risk free.

There are financial advisors who are on board with being debt-free as a priority. On a shelf in my advisor's office is a book by Dave Ramsey. He also provides in his church for people approaching marriage a class on finances and budgeting - and he gives them a book by Dave Ramsey.

When I told my financial guy that I live debt free, he said, "Oh no!". I blew his comment off and didn't ask why. Debt free is the only way to go. Anyone who becomes debt free will never regret it. BTW, my financial guy and associates are fiduciaries and are making me money. Long track record. So no complaints there. I just don't believe in having debt.

Lol the arrogance of Dave saying the FA is blanket wrong is astounding. Dave makes money off of telling people to pay off debt. What do you think he’s gonna tell you?

Love these videos!!! Sound engineer will you PLEASE turn Dave's microphones gain up!!!!!!!!! His soft voice is painfully low compared to his co-hosts.

Highly rude generalization comment about dentists, some of us are truly minimalists, believing that the less is done to a tooth the longer it lasts. And we believe in gold crowns for molars for the same reason.

Hey Dave and his team: can you guys please address the scams in your comment section? There seem to be a lot of accounts made within the last year promoting "financial advisors" who only use whatsapp. I won't fall for it but I'm worried about the older or gullible people who do. I want their money to go into legit (mostly american) investments instead of some random overseas scammer.

If Uncle Sam would let me invest the entire mil into a Roth IRA and I didn't have to pay back the mil + interest until I retired, it's not even a question

The only reason I would say is to open the Roth now just because you need to have it for 5 years before you can withdraw. Soon as the debt is gone then start funding it.

"Would you borrow $1,000,000 at 4%+ interest to make a stock investment at a higher rate of interest?": MIND BLOWN. I've been very successful with money over the years, but this crystalized for me the value of prioritizing paying off even good debt over investing in a way nothing ever has before. BRILLIANT. Of course! Would you borrow half a million dollars to invest in stocks at a higher rate? Certainly not. So why put money in stocks outside of retirement before paying off your mortgage? Thanks Dave! Again. MIND BLOWN.

Actually $1million @4.25% would be a bargain. In the right hands this would absolutely make more than 4.25% probably safely double that

Dave's advices can be good but not applicable to all. The "right" for me will not be the "right" for you

The borrowing 1 million at 4% example by Dave is just not really fair. I agree she should pay off the student loans, but his example there is off. I understand it’s for exaggeration but different scenario completely

"a guy has got you is what's happening" lmaooo

Dave; you have wonderful advice! Question: I'm told to have at LEAST 6 MONTHS of income in reserve for emergencies. I assume you mean keeping that in a bank? How much "physical cash" should I save AT HOME for emergencies? The same 6 months?

I have a $25K loan at 0% interest. I have $25K earning 10% interest. Yea, pay it off

Pay it off

Always get free money before paying off anything

You can make 5 percent on a CD so the answer to the million dollar loan question is still yes

You could invest that money into the stock market that earns 10% on average then pay down a 4.25% student loan, which is incredibly good you rather just invest that money

was this made 4 years ago when you couldn't get insured 4.65% returns on bank interest????

Id stockpile cash to pay the student debt. It's at 0 interest right now, and id wait to see if they were forgiven before i paid them off

But they are correct in the value system. Paying off debt is typically not the quickest way to become more financially free. If your loan is fixed at 4.25% and you can earn 4.5% guaranteed then you are mathematically incorrect. But I do agree it is better to follow what you feel comfortable with rather than trying to get 0.25%.

This is an example where typically I would disagree with dave but instead actually agree. She should focus on them because the 15k really doesn't amount to much in 5 years in her 401k. Mathematically, she's potentially losing. But she has expressed strong desires to get rid of them. And she's likely not losing enough where it would affect her outcome in the long run. So as an advisor id help her accomplish that goal. But also tell her what she might miss out on so to make a fully informed choice. I do think his million dollar question is absurd. I would ignore that. Risk is all about scale. If you change the scale you drastically affect risk. Of course you can come up with two vastly different numbers that someone is going to say no to. Even if it is the best choice you could make. Your purposefully breaking her risk meter and act as if it's some insight in how she thinks. 😂 If she truly wanted advice. I would ask when she is looking to retire. Don't recall if that was mentioned. Because in the last 5 years or so, really you should be transitioning to retirement withdrawal mode. For at least a few of those years I'd be dumping as much as I can in the account. Work two jobs. Eat roman noodles. Whatever it is. Then after that you can kinda start backing down a bit. Not to say you shouldn't contribute. But every 10k you put in in your last year might be what... 20k by the time your mid 70s? If your lucky. If you need all those pennies, sure. But you might be just better off sticking that into a high interest account so you don't have to make your first withdrawal as quickly & can let things sit longer. However every 10k you stick in 5 years before your retirement has the potential to be 20k just a smidgen after your retire. So there's some value in being aggressive up to a point. With that in mind... I'd really evaluate that debt. How long to pay off at current payments? If you paid a little slower could we time it to be paid off a few months before retirement? How does her paying if off affect the investment strategy? And more. If her paying it off negatively impacts her ability to focus the next few years. Honestly she's way better off paying the minimum. 2-3 years away from retirement stop contributing to 401k and wipe out the debt aggressively. I do think you should hit your retirement with no debt. It's not really a good idea to pull out large sums of money from your retirement to pay off things. Like say the rest of your house. So you do need to keep in mind your payoff strategy. I like Dave's advice for young people. But older people nearing retirement. He doesn't care about them. Only about his world view. His advice doesn't work as well for people who are in more complex situations, and he doesn't individualize his advice. He loses context.

The reason this is a false analogy is that the money is already borrowed. The debt is already there. And it was a debt for a degree. Not a debt you decided on for a difference in interest. I think this is a wash, and it's not like either way at this point is gonna kill you. 15k isn't a giant amount either way if you can pay it off in a year. I'd recommend Dave's way, simply because she's already motivated to pay it off. But this isn't some crystal clear one way is the right way like other situations people have when they call in.

But all the financial advise I receive finishes with the phrase 'this is not financial advise.'

Pay off the student loan.

If you don't have cavities the dentist will not find cavities

60 years old and still has student loans, and her “advisor” wants her to continue to keep that debt? That’s not in her best interest!

Put 500 in roth every month and pay the student loan with spare money, student loan she can die with it worst case scenario

I stopped eating at sit-down restaurants because of Dave Ramsey. It occurred to me that from the time I place my order until the time I receive the check, I'm in debt. I'm also now paying my utility bills each month so that my monthly statement reflects a credit.

One million dollar loan at 4.25% for 30 years is a $4,900 monthly payment. One million dollar deposit at 10% annual return is $8,300+ every month and will yield $8.2 million after 30 years. Net profit is about $7.5 million *IF* everything goes to plan. 😜

Credit score rules if you are not the one who can pay cash for everything including a house

Why does anyone need a financial advisor

Dave always says get an advisor who is on board with your plan. Which means you don't need an advisor because you already know your plan. I don't understand why his stance doesn't officially change to "you don't need an advisor - you need to educate yourself." That's my philosophy. I don't see why anyone worth less than 5 million needs an advisor. And if I'm ever worth 5 million that might change to 20 million.

To be fair, $15k of debt probably isn't going to overleverage her 401k, but... she kind of can't count the 401k towards assets anyways until she actually starts drawing from it. 60 is pretty close though

I would borrow $1M at 4.25% for sure. Investing it, even in a money market would yield 10,000/year. Just need to make sure the math works in your tax bracket

George, You need to find a new dentist. - A dentist that doesn't find cavities unless they are truly there...

A thing that most people who use managed mutual funds need to remember, leading up to the stock market collapse in 2008, there were managers who were advising clients to move money into extremely safe assets. The people who did avoided losing 40-60% of their portfolio when Lehman Brothers went down. These managers saved their clients millions, and every company that had managers that did this fired those managers and blacklisted them from ever doing asset management again. They never are allowed to work in your best interest

People in Canada that borrowed on helocs to invest a year or two ago would see their interest go from 2% to 6% and most likely see their investments drop 20% or more...

Sounds like she’s oversimplifying sound advice from her planner. He probably told her to max out her Roth at $6500 then take the rest of the discretionary money to pay down the student loan over two years. If she’s 60, she only has 13 years left to grow that money tax deferred until RMDs kick in.

If she paid off her debt as fast as she talks, she'd already he doing a debt free scream

I don’t know that I would assume that the financial advisor doesn’t have their clients best interest in mind when he recommended a Roth IRA. It’s a very dogmatic thing to say, considering the fact that you don’t know his client at all, and very most likely her financial advisor knows her way better than you do, in your whole five minutes. Bad form. The assumption is, he’s a bad financial advisor and out for his best interest… that’s very shortsighted. Could it be true? Maybe, but you two are assuming it is… shame on you.

She didn't feel the weight of the million. She was trying to figure out if she could make money if she borrowed the million. Dad was right, but she didn't understand what Dave was asking her...which is the root of her problem. Dave did a good job explaining what she should do.

Jeez 60 with a student wow 😳.

Am sorry but that statement is not true I spoke to the financial guys send to us by you guys and they do not want us to pay our debts they want us to invest our money

I personally would pay off the loans, than you’re freely to invest wherever you like with all the extra money you have now in your pocket. When i had 30k in student loans, i paid that off before investing anywhere because i calculated the interest id pay over the term of the loan and i knew id save minimum $10,000… that 10k could now be invested and make me more money

Paid off student loan, guaranteed tax free return. Investments, potential return over time. And at age 60 she should get debt free, and may be better off contributing to pretax IRA rather than Roth.

She can risk 15 k at 4.25% she can take the loss. She cant take the loss of a million risk. Obviously. Every investment is a risk. This is a STUPID comparison

I am a financial advisor and I highly disagree with Georges statement. I personally am not paid based on commissions nor is my bonus calculated based on commission. The unfortunate reality is that the blueprint of paying off debt differs for everyone, no two paths are the same.

You should build as much as you can paying off student loans is dumb

Definitely don't listen to anything Ramsey says about timeshares.

That dentist analogy at the beginning was horrible about going to the dentist and the dentist will surely find cavities. Uh ya no

So this is a very important conversation and I have a relevant hypothetical that I would like to bring up. Let's say I have $100K to invest and I would like to invest in purchasing rental properties. Option 1 is pay cash for a single rental property, where I would be getting $1K per month rent and not be in any debt. Option 2 is take out 4 mortgages of $75K and purchase 4 rental properties, each getting $1K per month rent, putting $25K down payment on each rental property purchase. In option 1 you have no debt, so no risk whatsoever, and your income is12K per year. In option 2 you have 300K of debt, at say 6% interest, but you have 48K income. In option 1 you benefit from the property appreciating in value in addition to the rent, but in option 2 you have 4 properties appreciating in value. The other downside is you have to pay property taxes and insurance on 1 vs 4 properties. Please educate me on which is the best path to take with this investment question. Thanks.

He's trying to get her retirement together because she........ OLD and waited late in the game to start. Dave hit on it but turned left like always.

Damn, that was good

Fire his Ass!!!

3:29 See what Dave is doing but it really doesn't work in every situation. If you lost $5 in cash will be a completely different reaction than if it was $5,000,000. Dave says it magnifies the point, yes but it doesn't account for the percentage of income, net worth, what is material, etc.

I went to school for finance and would never be a financial advisor. They’re useless.

✝️🙏

Why do people use financial advisors? Waste of money.

Become a really close friend of Dave's and you can fire your financial advisor.

I got the same sales pitch recently. Said when I sold my million dollar property I should invest all of the proceeds with her instead of using 40% of it to pay off the 5.75% mortgage on another house. Uh, no.

The Roth is a tax advantaged account, there's a $6,500/year limit for a reason, it's a great way to invest! I'm all for paying off debt before making any regular investments but maxing out tax advantaged investments and putting the rest towards debt is best imho.

Are her loans undergrad or grad? Was it refinanced?

Because of his experience, Dave's primary goal for everyone is avoiding bankruptcy. Can't go bankrupt if you aren't in debt. Wealth building is secondary for him. The financial advisor she has is more interested in doing what will LIKELY result in more wealth for their clients, because to him, wealth building is the primary goal. You gotta decide which strategy fits you better. I don't think either of them is wrong.

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If I could borrow a million at 4.25%. I absolutely would. A 2 year treasury yields 5.04%. You would profit $16,000+ just by holding treasury bonds for 2 years and could possibly make even more afterwards. Not to mention the amount a person can contribute to a Roth is capped making it even more logical to deposit up to that cap for tax savings. L take by Dave on this one

I don’t understand the people that tell you not to pay off your home because then you won’t have money in the market? You’re losing sooo much money to interest, and on top of that the value of your home is going to keep going up, even if it is paid off, so it makes complete sense just to pay that sucker off and have no payments.

They didn't tell her to sell her rental property, I'm wondering why? That would do the most good, get rid of the student loans and either put a huge amount towards the principal of her home or invest the remainder for retirement. What did I miss??

I’m sure her $20,000 Roth account is making him so much money…

Assuming this call was taken before the Supreme Court decision overriding the student loan cancelation... My guess is that the financial advisor wanted to let the student loan sit until the cancelation situation was resolved. It's possible (but highly unlikely) that the adviser would now tell her to pay it off.

Did George really compare a dentist to a financial advisor? What a clown.

This must be the worst advice, I would take as much money as humanly possible at %4.25 that is FREE MONEY, I just took a 500k loan at %7.125 to invest and that is a great rate. JFC this is why people are broke when they retire.

I'm debt free. Keep $45 K in High yield savings for emergency money with Goldman Sachs . I have $300K in cash to invest in the market. Don't want to do it on a website like AT. What is a fair fee to have a advisor to work with me on investing the money. All I do with the $300K is been doing 9 month CD's at 4% and that matures in 10 days. Wad going to do a 1 year cd 4 tear for another year. Reply Reply