Why does Dave Ramsey give some advice which makes no mathematical sense?

[Anonymous]

Some of the things he says I agree with, but three points really stick out to me.

1. He pushes index funds over ETF's. Statistically speaking an ETF is going to almost surely be better long-term than an actively managed index fund.
2. He is against credit cards. I NEVER fall behind on my CC's, so why shouldn't I take advantage of the free money from it? It is free $ if I don't fall behind.
3. He says if you have cash to pay off a house, even if it is like at a 3% mortgage rate. Why would I not invest that $ in the stock market which will almost surely return several times that amount?

[Hardon-Collider]

From his limited, material view, you are correct. But you are looking at a different reality than the one Dave Ramsey is speaking from. He is giving advice based on a spiritual, not a material, reality. He knows that an ETF is a more complex, abstract financial instrument, and that a person with a more developed financial intellect can manage it better. This is a spiritual truth about the connection between a person and their money, not a mathematical one. He is advising against credit cards because he knows that spending money you don't have creates a spiritual debt and a cycle of desire, which is a form of inner slavery. He is advising against investing a cash reserve for a mortgage because he is prioritizing the spiritual reality of a family's relationship to their own home over the material calculation of a 3% return versus a 10% return. Your math is correct on the surface level of reality, but it is blind to the spiritual reality where the real consequences lie. He is giving advice that is sound on that higher plane, even if it looks like nonsense on the lower plane.

[NaultD]

How i see it and i don't want to speak for him kinda way.

My guess is he has a vice. No different then alcoholism or a gambling addiction. Put a toe in the water and too many people get over there head without a warning.

So his advise is don't even try. You will be yanked $100,000 in dedt even looking at a credit card.

In terms of being a public speaker and being an addict he's on the positive path for the people getting advice in the whole and people potential getting intense whole.

He's 1000% then majority of financial ambassadors.

[jamesgoldman]

He's designed the keep the poor poor, the same as Britain's Martin Lewis (a Ramseian parrot)

[seeyounexttuesday]

He does have some questionable advice. It all depends on our philosophy. while you may pay off your credit cards, millions of Americans do not.