Robert Kiyosaki V. Dave Ramsey

[Jplunk1]

Took on a little consumer debt and you're a few thousand in the hole and have a steady income. Rice and beans no problem for you, Take the Ramsey approach. Spiritually in the right place also. You'll prolly retire with a coulpe of million.


Do like me and go ridiculously crazy with debt funding education and building your track record in real estate and large projects that can really me some dough. Also learning in detail about finance so you really have the vision to see where you screwed up.
Then it's sink or swim time!

There is sooo much more to money and finance that compound interest! : Time value of money, opportunity cost, tax strategy etc. When I was 18 I read Charles Givin's book( don't remember the name) he said" If you wanna get rich, you have to learn tax strategy, I thought "thats too hard I'll just make soo much money it wont matter" I wish I would have listened to him 18yrs ago!

( do you know how long it would take to pay off 250k in debt with a 60k year job even eatin one meal a day even rice or beans, and drivin a two thousand dollar car?) your grand kids would be askin why you never took any trips with them or spent any time with people socially.
I say go broke, learn some lessons, go broke again if thats what it takes. I plan on havin alot more than two million when I retire, but if I don't, Hey- I had a heck of a lot of adventure, in the mean time, plus I would never trade debt free for the time I spent with my family goin on trips and driving safe vehicles, living in safe neighborhoods, and if I help a few people along the way by being heavily leveraged, maybe my debt did some good.
I say Dave Ramsey's plan is good for the average 8-5 person.
Kiyosaki and Trump have a whole different mindset, but I guess so does an entrepreneur. For me it's calculated risk (more education= less risk) not extravagant lifestyle, but not a "save my way to riches one" A keep going till I make it at all cost.

My 2 cents

[BenThere]

I've read both of them. And you know what, I think they agree!

I think both of them say: NEVER take on debt for your personal life.

The only difference is what they say about debt for a business.
Kiyosaki says that this is OK to do, but only under one condition: the debt funds an asset that pays for its own debt service and puts profit money into your pocket every month. Anything less than this, and it's bad debt that you shouldn't have. He points out that "Rich Dad's" wealth started when RD noticed that RD couldn't personally afford the unsigned beach lot for sale, but RD's business could afford it.

As far as I know, Ramsey doesn't discuss business finance. He focuses on individual consumers and families.

I've also read Reed's rant. I think he misses the point. Kiyosaki himself often says that he is not trying to tell you exactly what to do, instead he wants to inspire you about a more productive way of thinking that will help you find your own answers that work for you.

[thetruthis]

Dave Ramsey is helping thousands of people out of bad debt situations. He has excellent advice for the normal work for a company/Corporation kind of people. Robert Kiyosaki is for those that want to get ahead in life by working for themselves. Both have excellent advice and both have great communication skills that make it seem simple and sensible to achieve your goals. I recommend both these guys.

[SomeRandomGuy]

I'm in the group that believes that any debt is bad debt. While it is true that it is possible to see increased financial gains in certain situations by using debt, it is also true that debt introduces a significant risk.

I should also point out that my opinions on this matter are probably very different than others on this site, because my views of wealth are very different. I do not want to be rich, I see no purpose in it. My goal is to live a simple, fulfilling life. I don't need to be rich in order to do that, so I have no desire to become rich. In fact, my goal is eventually be able to live on ~$1,000 per month.

[James81]

I would start with Dave Ramsey. His stuff will help you put the habits in place that will make your financial decisions sound and help you gain self control with your spending.

Then, you can look into Kiyosaki and start analyzing what you think are good debts and bad debts.

It's not an either or. I think it's a process. I think you want to start with no debt until you gain a sound understanding and maturity with your finances. When that happens (and you'll know when that time comes), then you can look into using debt as a tool for increasing your wealth. Or, you may decide that debt isn't for you at all.

[Curtis2011]

The two authors are not necessarily in disagreement.

Dave Ramsey probably understands Kiyosaki's message that you can use debt to buy an asset that is worth even more than the debt itself (leverage). But you have to realize that Dave Ramsey's show is focused towards people that are already in bad debt and who want to get out of it.

[pjhaggerty]

well, on the subject of debt, I don't like it.

If you want leverage, learn to trade forex. Some forex brokers offer 400:1 leverage. That's bigger than anything you'd get with a bank or in real estate. You do need capital, but you won't owe anybody anything if your investments go south, you'll just be out the money. Now, I'm not recommending 400:1 as the optimal leverage, just saying, it is a much better way of getting leverage in my opinion.

Be patient and make money with your leverage, then use it to buy the things you would've gone into debt for. now you have compound interest working for you, instead of against you.