Dave Ramsey Financial Peace University Week 9

If you are just tuning in I’m taking the Dave Ramsey Financial Peace University classes and reviewing them each week. If you missed any you can catch them here;

The Class

This week’s class was called Of Mice and Mutual Funds. It was about investing, obviously. I liked this lesson quite a bit. Lots of good information. He gave a lot of definitions again, like in the insurance class. As I said during the review of the insurance class, knowing the lingo of investing is half the battle. He talked about the following investments.

  • Money Markets – Money Market Mutual Funds are where Dave keeps his emergency fund.
  • Single Stocks – To be avoided.
  • Bonds – Avoid single bonds.
  • Mutual Funds – Good long term investments.
  • Rental Real Estate – Paid off real estate is a good investment.
  • Annuities – Variable annuities can be used in certain cases to help grow money tax-deferred.
  • Horrible Investments – Gold, commodities, futures, day trading, viaticals.

I want to go back to Mutual Funds for a second. Dave talked a lot about diversification. Dave lays out his investment strategy and suggests you do the same. He puts 25% of his investment into Growth (Mid Cap) funds, 25% into Growth and Income (Large Cap) funds, 25% into Aggressive Growth (Small Cap) funds, and 25% into International funds.

Viaticals are when someone has life insurance and a terminal illness. You can buy the rights to their life insurance policy. Morbid.

The Sharing

The Pinks (one of our “traditional” Dave Ramsey couples) are going through quite a struggle at the moment. I think they need the most help of the group, but they are also trying the hardest. They asked about going beyond the baby emergency fund and saving the 3-6 months emergency fund right now, before starting the debt snowball. Mr. Pink is currently working under a contract but fears it won’t be renewed when it ends in a few months. At first the hosts started to say that he should still do the debt snowball. I almost interrupted to say that if it’s something he’s worried about that he should bank those extra debt payments until he finds out what’s going on with the contract. If everything turns out fine and the contract is renewed then he can send that extra money to debt. If he ends up unemployed then he can use that money to live on for a while. But eventually as the hosts talked they came around to that advice anyways, so I stayed quiet.

Mrs. Pink asked about getting a discount at the doctor when paying cash. She said she feels embarrassed to ask. I suggested to just call, not even say who you are, and ask if there is a cash discount. I bet there is. Everyone in the group was encouraging her to ask. Just ask! What’s the harm?

Have you ever asked for a cash discount?

Next Week: From Fruition to Tuition

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2 Responses to “Dave Ramsey Financial Peace University Week 9”

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  1. I got a doctor to not charge for a visit (I only needed a sample anti-itch cream for an infected bug bite) by asking. Normally it would have been $60, for under 10 minutes. It definitely cant hurt to ask!

  2. Sun says:

    I like retirement target date mutual funds. My 403(b) is with vanguard vforx. It follows the s&p 500 index I think and there’s a very low administration fee of 0.19%. I like that as I get closer to retirement age, the allocation change to less risky. It’s pretty much all automated.

    I’ve bargained for cash discounts or even discounts buy purchasing more. We got a 10% discount on our wedding flowers by paying cash on the spot. When you start counting the $100s the tone of the negotiation changes.

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