Latest news with #DaveRamsey
Miami Herald
8 hours ago
- Automotive
- Miami Herald
Dave Ramsey warns Americans about buying a car
During a recent episode of The Ramsey Show, personal finance author and radio host Dave Ramsey tackled a question from a caller about purchasing a new car, offering insights and a cautionary message to listeners weighing the decision. Ramsey frequently challenges the widespread belief in a "perfect" vehicle, urging buyers to let go of the fantasy. He believes a car should meet real-life demands, not an idealized version of them. Don't miss the move: Subscribe to TheStreet's free daily newsletter When it comes to choosing a vehicle, Ramsey has encouraged people to begin with lifestyle questions: whether a car or truck is better suited, how many passengers they usually drive, fuel efficiency needs, and cargo space. He said that these factors help clarify which models are genuinely useful rather than simply desirable. Ramsey warns that no vehicle satisfies every personal preference. Recognizing the difference between necessities and luxuries - and thinking ahead about long-term use - allows buyers to make smarter choices. Ramsey's advice consistently emphasizes budget discipline. He views paying interest as a financial misstep and firmly recommends buying a dependable used car with cash over financing a brand-new model. Doing so preserves financial stability and prevents unnecessary debt. Related: Dave Ramsey sends major message to Americans on IRAs, Roth IRAs He also suggests taking time with the search for a car. Ramsey urges buyers to investigate both online listings and physical dealerships, reminding them that rushing into the first decent-looking deal could mean missing out on something better. Before any of that, though, Ramsey stresses the importance of deciding whether the current vehicle truly needs replacing. Many people make the leap based on impulse rather than practical need, and he suggests that a realistic evaluation of the car's condition should come first. Ramsey also delivers a warning about common car-buying mistakes. While he acknowledges the emotional draw of a shiny new ride, he reminds people that poor financial decisions in this area can have long-lasting consequences - unless they take a deliberate, informed approach that turns the odds in their favor. In an episode of The Ramsey Show, a 24-year-old caller identifying himself as Micah asked Ramsey about buying a car. "I'm currently debt-free," Micah said. "I make $80,000 a year. I am currently maxing out my 401(k) and IRA. I want to buy a car that costs $30,000. However, I don't want to get rid of my current car. It would just be a play car." "It's a sports car," he continued. "I have $30,000 in cash that I'm prepared to pay for this car. I'm not sure if it's better to put this in a different sort of investment portfolio or if it would be OK to splurge and buy this car." Ramsey then ascertained that the caller's current vehicle is worth $13,000 and the car he is interested in buying is a 2019 Nissan 370Z. More on cars: Dave Ramsey has blunt words for Americans buying a carAlphabet's Waymo flexes on Tesla Robotaxi with latest updateTesla faces its most serious court battle in years "Here's the thing," Ramsey said. "I love cars, I drove here today in my Raptor. I love big engines. I like things that make noise. I'm redneck. I want a loud muffler, all that." "But the stupid things go down in value, like a rock," he emphasized. "That's where Chevy got that. 'Like a rock.' And that includes that sweet Nissan you're talking about. And that includes my sweet Raptor." "They go down in value." Related: Jean Chatzky sends strong message on buying vs. leasing a car Ramsey offered a word of advice about building wealth and how it often relates to car ownership. "If you're going to build wealth, you have to keep as small an amount as possible going into things that go down in value," he said. "So consequently, we find millionaires driving very conservative used cars until they've got substantial money." The Ramsey Show host explained that one of the guidelines he suggests people use is to not have more than half their annual income tied up in vehicles. "So adding up all of your little toys with motors and wheels, does it add up to more than half your annual income?" he asked. "Because if it does, you've probably got too much in things going down in value while you're trying to build wealth." Ramsey noted that with those vehicles, Micah would have about $45,000 in two cars. "You make $80,000 and so you're over half," Ramsey said. "So, sweet car. And you've got the cash. You can do it." "I mean, you can afford it obviously, but the warning is that you're putting money in the wrong places if you want to be wealthy." Related: Dave Ramsey has blunt words for Americans buying a car The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Yahoo
10 hours ago
- Business
- Yahoo
The real reason a staggering 40% of U.S. homeowners are mortgage-free
Want more housing market stories from Lance Lambert's ResiClub in your inbox? Subscribe to the ResiClub newsletter. The real reason a staggering 40% of U.S. homeowners are mortgage-free Tsunami warning tracker: Map and online tool let you follow alerts in real time after massive earthquake Figma's IPO date is close. The stock could trade even higher after the design startup's latest move Shop Top Mortgage Rates A quicker path to financial freedom Personalized rates in minutes Your Path to Homeownership Here's a stat that would likely make financial adviser and radio personality Dave Ramsey—who has long advocated for Americans to pay off their mortgages early as a key pillar of his debt-free philosophy—at least somewhat pleased: A staggering 39.8% of U.S. owner-occupied housing units in 2023 were mortgage-free, marking a new high for this data series. That's up from 39.3% in 2022 and 32.8% in 2010. Among the 85.7 million U.S. homeowner occupied households, 34.1 million are mortgage-free. The other 51.6 million have an outstanding mortgage. So why did I say it'd only make Dave Ramsey 'somewhat pleased'? Well, the reason is that a higher percentage of Americans are mortgage-free isn't necessarily because so many are paying off their mortgages faster. Instead, it reflects a powerful underlying demographic shift: the aging composition of the American population. As Americans live longer, the U.S. fertility rate declines, and the massive baby boomer generation ages into their senior years, the U.S. population has skewed older. Since older homeowners are more likely to have paid off their mortgages, the aging composition of the American population means a larger share of homeowners are achieving mortgage-free status each year. The other thing is that when older Americans sell their house and buy another home, they're more likely to rollover their equity and purchase that next home in all-cash. Given that most demographic forecasts expect the composition of the American population to continue shifting upward in age, the share of mortgage-free households could also continue rising in the years to come. The wild card? If reverse mortgages get more popular and more older Americans take on mortgage debt again to tap into their equity. This post originally appeared at to get the Fast Company newsletter:
Miami Herald
16 hours ago
- Automotive
- Miami Herald
New Car Buyers Are Getting Trapped in This Scary Financial Situation
New cars are expensive. According to data from Kelley Blue Book and Cox Automotive, car prices are being kept steady, but the average new car in the U.S. still costs a whopping $48,799 in May 2025, a 2.1% increase from the same month in 2024. Despite this, it's easy to get tempted by the idea of a new car. It can be anything: either your current ride is giving you headaches, the new model for 2026 looks really cool, or your local dealer is offering a sweet financing deal on a 2025 model that can be shoehorned into your budget. However, for a disturbing number of Americans, these decisions leave them in a level of debt that would make Dave Ramsey and Caleb Hammer emotional and stuck in a hole that's getting even harder to climb out of. According to new data from car-buying authority Edmunds, the level of negative equity (when people owe more money on a car than its value) in new car purchases has reached a four-year high. They report that 26.6% of cars traded in towards new cars had negative equity in the second quarter of 2025, up from 26.1% in Q1 2025 and 23.9% in Q2 2024. When buyers trade in a car with negative equity, the amount people owe is usually rolled over or paid up front. Edmunds data shows that the average amount that buyers owed on cars with negative equity in Q2 2025 was $6,754, and over a third (32.6%) of underwater buyers carried between $5,000 and $10,000 in debt into their next car loan. Additionally, 23.4% of these buyers owed more than $10,000, and 7.7% owed more than $15,000. "Consumers being underwater on their car loans isn't a new trend, but the stakes are higher than ever in today's financial landscape," Edmunds director of insights Ivan Drury said in a statement. "Affordability pressures, from elevated vehicle prices to higher interest rates, are compounding the negative effects of decisions like trading in too early or rolling debt into a new loan, even if those choices may have felt manageable in years past." The rise of negative equity comes as buying a new car is tougher than ever. Car prices are still high, and interest rates are much higher than those of the COVID years in 2020 and 2021. Despite this, many consumers follow along, trading in their cars early and/or rolling existing debt into their next car without adjusting their budgets. As a result, in the second quarter of 2025, the average buyer who piled their negative equity on top of a new loan financed an additional $12,145 compared to the typical new car buyer. Additionally, they made average monthly payments of $915, compared to the typical new car buyer who paid $756. Figuring out if you have negative equity with your car loan is pretty simple. Start by checking how much your loan payoff amount is, which you can find in your monthly statements. Then, see what your car is worth right now on sites like Edmunds or Kelley Blue Book. If your loan payoff is more than what your car is worth, you have negative equity, and the difference between the two numbers is how much you're underwater. Joseph Yoon, a consumer insights analyst at Edmunds, advises, "In many cases, holding onto your current car and staying current on payments and maintenance may be the wisest choice." That said, if getting a new car feels right, then making the right decision about your shopping is crucial. He also says, "If a new vehicle is the right decision for you, doing your research is key. Choosing the right car for your needs and budget can save you more in the long run than any incentive the dealer or manufacturer may be offering. In today's market, smart shopping is your strongest defense." Copyright 2025 The Arena Group, Inc. All Rights Reserved.
Fast Company
2 days ago
- Business
- Fast Company
The real reason a staggering 40% of U.S. homeowners are mortgage-free
Want more housing market stories from Lance Lambert's ResiClub in your inbox? Subscribe to the ResiClub newsletter. Here's a stat that would likely make financial adviser and radio personality Dave Ramsey—who has long advocated for Americans to pay off their mortgages early as a key pillar of his debt-free philosophy—at least somewhat pleased: A staggering 39.8% of U.S. owner-occupied housing units in 2023 were mortgage-free, marking a new high for this data series. That's up from 39.3% in 2022 and 32.8% in 2010. Among the 85.7 million U.S. homeowner occupied households, 34.1 million are mortgage-free. The other 51.6 million have an outstanding mortgage. So why did I say it'd only make Dave Ramsey 'somewhat pleased'? Well, the reason is that a higher percentage of Americans are mortgage-free isn't necessarily because so many are paying off their mortgages faster. Instead, it reflects a powerful underlying demographic shift: the aging composition of the American population. As Americans live longer, the U.S. fertility rate declines, and the massive baby boomer generation ages into their senior years, the U.S. population has skewed older. Since older homeowners are more likely to have paid off their mortgages, the aging composition of the American population means a larger share of homeowners are achieving mortgage-free status each year. The other thing is that when older Americans sell their house and buy another home, they're more likely to rollover their equity and purchase that next home in all-cash. Given that most demographic forecasts expect the composition of the American population to continue shifting upward in age, the share of mortgage-free households could also continue rising in the years to come. The wild card? If reverse mortgages get more popular and more older Americans take on mortgage debt again to tap into their equity.
Yahoo
2 days ago
- Business
- Yahoo
Dave Ramsey gets frank with Seattle woman $100K underwater on Florida home — what he says to do about her ‘sunk costs'
When Sarah from Seattle recently called into The Ramsey Show, Dave Ramsey described her situation as 'a ticking time bomb." She owns a condo in Seattle with a $2,300 monthly mortgage plus homeowners association (HOA) fees, and purchased a second property in Florida last year at the top of her budget. Don't miss Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 6 of the easiest ways you can catch up (and fast) You don't have to be a millionaire to gain access to this $1B private real estate fund. In fact, you can get started with as little as $10 — here's how Now, the Florida mortgage costs her $4,000 a month, rental income of $2,700 doesn't cover it and the property remains in negative equity. Why she's underwater Originally from Florida, Sarah knew she eventually wanted to return to be near her aging parents. She says she "freaked out because of the housing situation.' With prices going up, she worried that if she waited too long she'd get priced out of the market. So, she went ahead and bought the second property. Shop Top Mortgage Rates Personalized rates in minutes A quicker path to financial freedom Your Path to Homeownership Unable to rent it out for more than a year, Sarah finally has tenants, but their rent falls $1,300 short of her monthly mortgage payment. She's spent approximately $23,000 in closing costs and $50,000 more trying to sustain the property. Despite having $50,000 in savings and a strong take-home pay of $8,600 a month, she simply can't afford to live this way anymore. Ramsey and cohost Jade Warshaw strongly recommended that Sarah sell the property. 'You have a problem here that is not going to get better … If you have to write a $10,000 check to get rid of your mistake, do it,' Ramsey asserted. The pair recommended immediate action, first by quickly listing the home. Ramsey warned she'd pay some "stupid tax" for her mistake, but she needed to take a short-term loss to stop the financial crisis. "You're going to get some of your money back, but you're not going to get all your money back," he said. Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says — and that 'anyone' can do it The sunk-cost fallacy and its dangers Sarah's reluctance to sell stems from the sunk-cost fallacy: the belief of having invested too much to walk away. Ramsey warned against this mindset. "There may not be a way to get back the money that's lost. You're doing well if you can break even … Mistakes cost you,' he said. Ramsey and Warshaw advised Sarah to focus on cash flow, not past expenses, cautioning against letting emotional attachment or fear keep her trapped. If she keeps the home, they warned that the situation could get worse through things like insurance issues, vacancy cycles or emergency repairs. "We're trying to stop the bleeding, not reverse the fact that we had a car wreck." Sellers in Florida markets like Miami are increasingly delisting homes rather than cutting prices, suggesting buyers are becoming scarce. Meanwhile, Florida home prices dipped 2.2% year-over-year to a median of around $412,400 as of May 2025, according to Redfin. These conditions give all the more reason for Sarah to get out of the market sooner than later. Plus, carrying the property risks continued price drops, increasing home insurance and HOA costs and the chance of foreclosure. Florida had 2,780 foreclosure starts in May 2025, among the highest in the U.S. Homeowners there face rising insurance premiums, with the average cost increasing 45% from 2017 to 2022, alongside higher HOA fees and property taxes — all putting sellers at risk even in rising markets. Nationwide, it's not much better. In May across the U.S., housing prices were up just 0.6% to $440,910, while the number of homes sold was down 4.5% year over year. Affordability continues to suffer due to high mortgage rates and regional oversupply. What to read next Robert Kiyosaki warns of a 'Greater Depression' coming to the US — with millions of Americans going poor. But he says these 2 'easy-money' assets will bring in 'great wealth'. How to get in now Accredited investors can now buy into this $22 trillion asset class once reserved for elites – and become the landlord of Walmart, Whole Foods or Kroger without lifting a finger. Here's how Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Stay in the know. Join 200,000+ readers and get the best of Moneywise sent straight to your inbox every week for free. This article provides information only and should not be construed as advice. It is provided without warranty of any kind. Sign in to access your portfolio
