Ask Davehttp://www.daveramsey.com/etc/askdave/index.cfm2016-12-09T03:03:01ZDave Ramseytag:daveramsey.com,2016-12-07:131686A bad idea2016-12-07T09:58:16ZSandy is wondering about the wisdom of transferring an IRA over to gold. Dave let's her know, beyond a shadow of a doubt, that it's a bad idea.<p><b>QUESTION:</b> Sandy asks Dave what he thinks about transferring an IRA over to gold. Dave leaves little doubt that he believes this would be a really bad idea.</p><p><b>ANSWER:</b> That’s one of the dumbest things a human could possibly do. I hope I wasn’t unclear.</p><p>Gold is going down like a rock right now. As people start to believe in the economy and the economic direction of the country — and the stock market indicates they are — gold becomes worth less and less. Gold is a fear-based product. When people thought Obama was going to screw everything up, that’s when gold went through the roof. Or in 2008, when Bush and Obama were working together to screw everything up and everyone was scared to death, gold shot way up. But it’s a fear-based thing. The less fear there is, the cheaper gold is.</p><p>That’s not how you want to fund your IRA. You want to fund your IRA with something that has a track record that’s based on growth, and the growth is based on the performance of the companies involved — not someone’s greed or fear. Gold is a horrible investment. I do not own any gold, except for one really nice watch and a pair of cufflinks. That’s it.</p><p> </p>
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tag:daveramsey.com,2016-12-01:131666Eyes wide open2016-12-01T14:58:21ZJen's husband is an optometrist. He has been offered the opportunity to become a full partner at the practice in which he is currently an associate. Jen asks Dave for advice on evaluating the offer, so that they can make a wise and informed decision. Listen as Dave talks about the pros and cons of partnerships and business models.
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tag:daveramsey.com,2016-11-22:131656Let them be kids, too2016-11-22T15:15:36ZValerie and her husband would like to give something to their grandchildren for Christmas other than the usual toys. Dave likes their idea of planning for the future, but he advises them to throw in a few toys, too.<p><b>QUESTION:</b> Valerie and her husband have three young grandchildren. They’re in good shape financially and would like to give the grandkids something for their futures instead of the usual toys for Christmas. Dave guides them on the saving aspect, but advises them to include a few toys in the mix as well.</p><p><b>ANSWER:</b> I would do both. I don’t think you want to be those grandparents who only hand their grandkids envelopes at Christmas. They need things to play with. They’re kids, and they should be allowed to act like kids and be happy at Christmas.</p><p>You could work with their parents to launch Educational Savings Accounts (ESAs) for them. This would get their college funds started, and it’s what’s we do. We use mutual funds in their ESAs, where each child is allowed to have up to $2,000 added in their name per year. </p><p>The beauty of the ESA with the mutual fund inside it is that it’s growing completely tax-free. You have to name a custodian of the account until the child turns 18, and that could be you guys or their parents. Make sure that together you don’t overfund the ESAs and cause yourselves tax problems.</p><p> </p><p> </p>
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tag:daveramsey.com,2016-11-22:131655The teacher was wrong2016-11-22T14:36:09ZAllison's daughter was given some inaccurate financial information by a college instructor. When Allison asks how to handle the situation, Dave gives her some practical advice and an amusing story regarding one of his own daughters.<p><b>QUESTION:</b> Allison’s daughter is a college freshman. Her daughter got some bad information from an instructor recently, and Allison wants to know how she should explain to her the professor was wrong. The instructor told the class the only way to buy a home without a high credit rating is by having a huge amount of assets or savings. Dave gives his take and recalls an interesting situation from a few years ago.</p><p><b>ANSWER:</b> Well, the first thing you explain to an 18-year-old is that tenured college professors have the right to be absolute morons and keep their jobs. There’s no sense in arguing with them, because many times they’re some of the most arrogant human beings on the planet. </p><p>A few years ago my daughter took a personal finance class in college, and on the first day the instructor went on a rant saying Dave Ramsey is stupid. She went through the entire class and never said a word. When she called home and asked what she should do, I said take the tests and answer the questions the way he wants them answered. You’re just taking a class — that doesn’t mean you have to form your opinions around it. </p><p>Anyway, what I would do here is just explain to her the college professor doesn’t know what he or she is talking about. You can get a home loan with no credit score. People do it all the time. You can call Churchill Mortgage if you want and have one of them give you an example of it. All you need is a reasonable down payment, have two years at the same job, and provide two years of tax returns.</p><p> </p>
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tag:daveramsey.com,2016-11-15:131650Dave for president?2016-11-15T11:13:41ZDave answers fans who think he should run for president. Listen to his humorous response, as he details the reasons it would be a bad idea.
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tag:daveramsey.com,2016-11-03:131632Snakes bite!2016-11-03T11:46:27ZTyler and his wife have the cash to pay for an entertainment center, but the manager has offered them a 10 percent discount if they get a store credit card. Dave warns them to stay away from this kind of stuff.<p><b>QUESTION:</b> Tyler and his wife are building a home. They found an entertainment center they want for the new place, and the dealer will give them 10 percent off if they take out a store credit card. They have the cash to buy the piece outright, but Tyler wonders if they should get the card and use it for the entertainment center and Christmas gifts then immediately pay it off, close the account, and cut up the card. Dave is skeptical about the idea, and he explains why. </p><p><b>ANSWER:</b> Yeah, that only works when it works. The first problem is most people don’t follow through on what you’re talking about. The second problem is a lot of places hit you with a fee when you pay it off, the thing runs over, then you get another fee, and so on.</p><p>I’d just call the manager out of the back office and let him know that unless he discounts the entertainment center $600 I’m going to his competitor. No, I’m not taking out your stupid credit card. </p><p>Dude, you have got to learn to stop playing with snakes — they bite. You have got to stop screwing around with debt products. Everybody thinks they’re somehow winning or getting rich doing this kind of thing, but it doesn’t work. You have to stop it. They’re trying to hook you, man!</p><p> </p>
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tag:daveramsey.com,2016-11-03:131631Automatic round up?2016-11-03T11:17:54ZBecky asks Dave what he thinks about bank automatic savings plans that round up each transaction and put the rest into savings. Dave urges her to save and invest on a much larger scale.<p><b>QUESTION:</b> Becky on Twitter asks Dave his opinion of bank automatic savings plans that round up each transaction and put the rest into savings. Dave says he doesn’t mind these types of programs, but he worries that they give customers a false sense of accomplishment and security.</p><p><b>ANSWER:</b> Do you know how you end up with money in investments? You end up with money in investments because you put money into investments. If you put a lot of money in investments, you’re going to have a lot of money in investments. If you put a small amount of money in investments, you’re going to have a small amount of money in investments.</p><p>All of these things that “round up” have you putting pennies into investments. You might say pennies add up. Yeah, they add up to a stack of pennies. You don’t need to be putting pennies into your investments. You need to be putting thousands of dollars into your investments. Try rounding that up! Get out of debt so that you’re putting the equivalent of a car payment or a student loan payment into investments. </p><p>It’s not evil to round up and have an automatic savings plan. But it’s like every time you buy a cup of coffee it puts four cents in there. Whoopee! It’s a pile of pennies. The problem is not that you’re putting money into savings, and the problem is not that it’s automatic. Saving is smart. The problem is when you’re looking at something like this it means you have an itch somewhere inside your brain that you need to scratch. The itch tells you that you’re not saving for retirement, and that not saving money is stupid. Then when you sign up for a bank round up thing, all you’re doing is scratching the itch with pennies. You need to scratch that itch with thousand dollar bills.</p><p>If something like this is your only retirement vehicle, you’re going to retire broke. You’re scratching the itch emotionally, but mathematically it’s a joke. So it’s okay to do it if you want, just make sure you’re still stressed out and worried that you don’t have a retirement plan. Your round up plan at the bank is not going to cause you to retire with dignity. It’s ok to do it, but it really isn’t doing anything.</p><p> </p><p> </p>
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tag:daveramsey.com,2016-10-21:131606Special needs coverage2016-10-21T09:23:32ZAlicia and her husband have a special needs child. She asks if they should take advantage of the child rider on their insurance policy. Dave thinks it's a good idea in their situation and explains why.<p><b>QUESTION:</b> Alicia and her husband have a son with special needs, who had a frightening episode a few months ago. She asks Dave if it would be wise to take advantage of the inexpensive child rider on their insurance policy, since they are still two or three years away from being debt-free and having a fully funded emergency fund.</p><p><b>ANSWER:</b> Yeah, I would do that at this stage of the game. A child rider is guaranteed issue in most cases, meaning they don’t do a medical exam or they’re not going to worry about the special needs issue — most of the time. Just make sure that it is what they call “guaranteed issue,” meaning there’s no medical exam needed on him for that to be issued.</p><p>I definitely would pick that up, even if you weren’t facing the things you’re facing. We carried them on our kids for a period of time, and they were not kids with special needs and didn’t have any medical issues. We carried child riders until we had enough wealth to, God forbid, pay for funeral expenses if something had happened to one of them. </p><p>Thank you for your call, and thank you for having the heart of a mother.</p><p> </p>
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tag:daveramsey.com,2016-10-21:131607Targeted funds for retirement?2016-10-21T00:00:00ZA Twitter follower asks Dave his opinion of using targeted funds for retirement. Dave doesn't advise it, saying the best way to approach investing is to keep things as simple as possible.<p><b>QUESTION:</b> David on Twitter asks Dave his opinion of using targeted funds for retirement investing. Dave isn’t a fan, and he takes the opportunity to explain his recommended investing method.</p><p><b>ANSWER:</b> I don’t use targeted funds. I use four types of mutual funds — growth, growth and income, aggressive growth, and international — and I spread my money evenly across those. I don’t want to deal with certain segments, and I’m not trying to target certain situations. If you’ll just keep your investing plan very simple, and look at the track records of the mutual funds you’re picking, you’ll be fine.</p><p>In the open market, where you’re just buying any fund for your IRA or whatever, you’ve got like 8,000 funds to choose from. So, you want something that’s got at least a good 10-year track record. You’ve got limited options in a 401(k), but you still want something that’s been open a little while so that you can look at its track record.</p><p>You should be able to find good, quality funds in the four categories I mentioned earlier that will give you a strong portfolio. Remember, it’s growth, growth and income, aggressive growth, and international.</p><p> </p>
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tag:daveramsey.com,2016-10-13:131585Be grateful and professional2016-10-13T09:25:19ZJT has worked at a small company for 17 years. The last time he received a raise was for just 50 cents, and that was 10 years ago. He has found a better paying job, so he asks Dave how to handle leaving a business where everyone is like family. Listen as Dave helps him out and, in the process, provides a look at both sides of the equation when a team member leaves a company.
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