Quote:
Originally Posted by DJ's left nut
Who, Ramsey? If so, it's off the backs of people that buy that nonsense, primarily people who lack the responsibility to manage their money in a far more effective manner.
If you can get a car at .9%, do it. Do it and don't think twice. Finance it for 5 years if you can. Then take the $30k you saved by borrowing on the car and invest it. Even a nominal return is going to be a hell of a lot better than the .9% you're paying out on the loan.
CoMo was offering a .05% loan over 10 years on any furnaces that qualified for the energy star tax credit. Ours was about to crap itself (and with the basement finished, it was no longer strong enough anyway). Ramsey's 'no credit' approach would have had me me living in a cold house while I save my pennies and end up losing this cheap loan, as well as the federal tax credit.
Why the hell would I do that when I can take the loan out and invest my liquidity in pretty much anything and get a far better return than .05%?
Why pay cash for things when you can invest the money and get an actual return on it that far outstrips your interest payments?
The man has some ideas that aren't all bad, but he overplays his hand and makes it entirely too simple.
|
I was referring to r8er fan having a paid off house. I think it was him who had a thread about it a while back.
As far as Ramsey's plan goes, you would have already had cash on hand to buy a furnace when yours went out. I really don't mean this as a swipe, but if you don't have a few thousand dollars to buy a furnace for cash, your savvy leveraging of debt hasn't amounted to much.
I don't have a problem with people trying to make a spread on OPM (I have a Finance degree, after all). I just see that as being a lot of effort for minimal benefit.
A $5000 loan earning a 5% spread comes to $20 a month, and therearent many 5% spreads free of risk laying around today.