This post comes from partner blog The Dough Roller.
As much good as he does, Dave Ramsey drives me nuts with his extreme views on debt.
Ramsey, as he readily admits, did some really stupid things with debt. Leveraged to the hilt on bad real estate deals, he went bust in a way most of us could never imagine. As a real estate investor, my leverage and borrowing comes nowhere near the toxic level Ramsey went to.
Why? Because Ramsey's personality is one of extremes. Much like an alcoholic, he could not control his use of debt. He got one taste of that leverage, and he was borrowing before noon ever day.
Dave Ramsey is a recovering debtaholic
Now he is a recovering debtaholic. Like a recovering alcoholic, he should never borrow again. Why? He just can't handle it. Put Ramsey and debt together, and something really ugly develops.
OK, fine. But why should that apply to all of us? It's as if a recovering alcoholic were telling the rest of the world never to have a glass of wine. In other words, what works and doesn't work for Ramsey may not apply to everybody else. Of course, there are those who, like Dave, can't control debt and should avoid it just like he does.
But debt, if used wisely, can greatly improve your finances, can increase your financial freedom in the long run, and can greatly improve your balance sheet.
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