The numbers don't lie — any kind of debt is a burden

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  • Steve C. Warren WEST VALLEY CITY, UT
    Aug. 3, 2018 5:35 p.m.

    Ramsey says a mortgage is OK "as long as it’s a 15-year, fixed rate loan."

    Our 30-year fixed-rate mortgage is also OK. It's at 3.75%, and I definitely wouldn't pay it off with money we have in accounts that constantly earn 6-7% interest. You come out behind doing that, especially when you consider that we get a tax deduction on mortgage interest, which has the effect of lowering our mortgage interest rate to about 2.8%.

    Same thing applies to the car loan we got in 2011 at 1%, although we didn't get a tax deduction on the interest.

    Debt is often a good thing.

  • liberal larry Salt Lake City, UT
    Aug. 2, 2018 11:12 a.m.

    You should consider Dave's perspective on debt, especially student loans. He regularly gets calls from people who have used student loans to get an undergraduate degree, and the loans are sometimes in the $100,000 plus range!

    Most of my friends in the '70's easily cash flowed college, it's harder today, but still possible to get through college without debt!

  • Zabilde Riverdale, UT
    Aug. 2, 2018 4:58 a.m.

    Properly managed debt can be a benefit. It can pay for the education that improves your lifetime earning potential. It can put you in a home rather than renting you entire life.

    And it can even be used to a profit. A few years ago I was purchasing a vehicle, I had the money to pay in cash at time of purchase, but the dealer was offering 0% interest. So I financed it, put the money in an interest earning account with automatic payments and earned interest on the money as I was paying off the vehicle. It wasn't a lot, but it was more than I would have had if I'd just paid the cash up front.

    Ramsey has a lot of great advice, but as with many such "experts" he's a zealot who takes his message way to far.

  • EscherEnigma Ridgecrest, CA
    Aug. 1, 2018 12:58 p.m.

    Is Ramsey up for paying the tuition and housing costs of students across the nation? If not, then by telling them that "all debt is bad" he's telling people to irrevocably damage their lifetime earning potential because they weren't born to wealthy parents who can front that kind of money.