I came across your channel through this video-case studies are incredibly valuable, and I'm eager to see more in the future! Building wealth involves establishing routines, like consistently setting aside funds at regular intervals for smart investments.
People believe their currency has the worth it does because they have no other option. Even in a hyperinflationary environment, individuals must continue to use their hyperinflationary currency since they likely have minimal access to other currencies or gold/silver coins.
For me, always take the lump sum. You can run all the different math calculations you want. The bottom line is you do not know at what point in time you are going to die. I want control over the money. I want control over how it is invested and distributed.
@@SenorJoeBiden if payments are 300K a year the lump sum is going to be relative to that....perhaps $4M or $5M. For a 1.6M payout like in this video, I'm guessing the annual payout would be around $100K.
Never, ever, take the monthly payments option. Not only does the lump sum stay in your family after your death, but it puts you in the driver's seat of your life. Your pension payments are pulled from an account that does NOT have enough money to make all of the payments they've promised to make. If everything is OK forever, this won't be a problem because the company has the rest of your life to come up with the cash each month. If the investment manager of the pension fund makes bad decisions and loses a lot of money or if the company winds up being mismanaged and goes under, those future payments are now in jeopardy. The fact that you are owed a set amount per month means nothing if there is no cash to give to you. Take the lump sum and you are guaranteed to get everything you are owed.
I am unsure if my 401(k) and IRA will provide a stable future. i need an approach that will align with my risk tolerance and financial goals, i set aside $1m to achieve this. Do you suggest i get into stocks or buy a rental property?
Research dividend aristocrats. Pick six to ten from that list. Those companies have a track record of 25+ years of paying dividends. Also, its advisable you work with a financial advisor to help set up a well-structured portfolio.
I agree. Based on my experience working with a financial manager, I currently have ($2million) in a well-diversified portfolio that has experienced exponential growth from when i started. It's not only about having money to invest in stocks, but you also need to be knowledgeable, persistent, and have strong hands to back it up.
I work with Sonya Lee Mitchell as my fiduciary advisor. Simply look up the name. You would discover the information you needed to schedule an appointment.
Thank you for this tip. It was easy to find your coach. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume.
Index invest, diversify by sector and country, use registered accounts first (exclusively), stay away from margin, dollar-cost-average, wait 20-30 years....profit. Its still shocking that investing is not really taught at the high school level. If I knew at 19 what I know now.....retirement at 40 would have been easy peasy.
I'm pretty sure this is precisely why it isn't taught in school. The system requires workers to keep that GDP moving,. Imagine if everyone retired in 20 years and quite mindless consumerism. The whole thing would collapse. It will probably collapse anyway as robotics and AI scoop up more jobs than they create.
@@qiuyueshu5459 I wish I learnt about selling call options a long time ago because this strategy and real estate is how I become wealthy. In my opinion trading ETF options and reinvesting is something that should be taught in schools.
I want to invest but I don't want to benefit from companies in the oil industry and unethical companies like Facebook. How can I invest in index funds and avoid these kind of companies?
Growing up in the Midwest we learned about investing super young. I’m 46 and right now I’m projecting to retire between 57 and 60. Obviously not stop working completely because I’d go insane. But be able to live off of ~ $4,000 a month without touching the principle if I need to start using it to follow whatever dream I want.
You cannot compare the two options (lump sum or pension payments) without knowing both sides of the equation. Dave immediately goes to the "take the lump sum" route without asking about the pension payment amounts. Another fact: the great unknown factor in this equation is how long the recipients will live. Pension planners, social security, insurance actuaries, etc., all use some type of actuarial tables to base their payments. "The Money Guy Show" has a very good discussion on this subject and actually goes into the mathematical calculations. The Secure Act of 2019 also changed the inheritance rules regarding IRA's, eliminating the "stretch provision" of 401k's and establishing a ten year window for 401k distributions. This means that withdrawal strategies should be a discussion in the overall retirement framework.
@@KC-dr3cg Well, there was no mention on what the pension is actually worth, only that they would get 7% a yr of it. The lump sum payment of a pension is almost always much less than what is in the pension, usually by a factor of 2. So, we can only assume that the pension would be 7% of $3.2million. I'd rather have a guaranteed $224k/yr until both myself and my spouse die (which could be 30+yrs from now), than having to somehow get a year over year return of 13+%, regardless of market fluctuations.
You should almost always want control of the money. $1.6 million is guaranteed if you take the lump sum. If you take the payouts, they can change the deal later, and you have no control over it.
This argument is horrendously wrong. First we need to separate this between public pension and private. Public - the vast majority of states either have no means to change pension benefits without a constitutional change or have an extremely high bar to reach to change benefits. They are governed by state constitution, contract law, or property law. NY, where the lady indicated she was in has constitutional protection for pension benefits. Meaning, they would have to amend the constitution to change pension benefits. Even if this was a different state, most have an extremely high bar to change benefits under contract law and bankruptcy. So, it would be hard to do it and cost a lot for legal fees. Not a logical place to cut expenditures. If this is a private pension - they cannot just change the payment amount. That isn’t how ERISA law works. Note, ERISA only applies to private corporation’s pension plans, it doesn’t apply to state, local, or church plans. For private plans, the company doesn’t have any means to change the payment that is not automatically tied to the inflation rate. The only way it could change is a) if the company goes under, then the obligation would go to the PBGC or 2) the gov’t changes the laws #1 a very rare occurrence. Benefits are impacted when plans don’t have the funds to meet obligations and then the benefit exceeds the PBGC max. The max could play a role here and hurt them, but it is very rare a company dumps their plan on the PBGC. Plus, private plans are pretty well funded today given new rule changes. Note, I said private plans, not public ones. #2 is true of any law and retirement vehicle. It is no more risky here. Also, the law they’d change, as noted before is ERISA. This is the same law that governs the 401k. So, the argument they could change the law would be directly applicable to the 401k. It is literally the same law.
I had a similar offer when my company was bought out (well, I was only being offered $40,000 vs a lifetime pension when I turn 65.) The fact that my company was pushing it so hard, made me think very carefully about it. A little math, I quickly figured out if I lived to the average age of 78 (and a few years below that), I would be better off taking the pension than the lump-pay out. Sure, if I die today, I get nothing. But statistically, I won't. Which is why the new company was hoping to get rid of the pensions by offering buy-outs to people. Now, I was, and am, completely debt free. If I had debt at the time, I may have made a different decision, in order to pay off the debt.
Yikes, that seems like a terrible buyout offer. As much as I am a "take the lump sum always" type of guy, I'd have to really run the numbers on this one. If you're in your 20's, that $40k could really grow, but if you are older it wouldn't have as much time. The more I think about it, because I really dislike pensions, and because I'm a "bird in the hand" type of guy, I think would still take the $40k.
@@Scott-got-caught I'm going by the average--obviously 50% of people will live longer than the average. But for actuarial purposes, the average makes sense to use.
As a soon retiree, keeping my 401k on course after a rocky 2024 is top priority. I have been reading of lnvestors making up to 250k ROI in this current crashing market, any recommendations to scale up my ROI before retirement will be highly appreciated.
The current market might give opportunities to maximize profit within a short term, but in order to execute such strategy , you must be a skilled practitioner.
Having an lnvestment adviser is the best way to go about the market right now, especially for near retirees, I've been in touch with a coach for awhile now mostly cause I lack the depth knowledge and mental fortitude to deal with these recurring market conditions, I nettd over $220K so far, that made it clear there's more to the market that we avg joes don't know
Hard to say without knowing what the annual pension would be. Not to mention if you take the lump sum it may not include health insurance, which if you have a public pension you get health insurance covered up until age 65 when you go on Medicare.
I'm not sure how you can give advice to take the lump sum when the caller never once mentioned how much per year the pension paid out or other points such as whether or not the pension adjusts with inflation. Maybe the lump sum is the better option but I would have loved to see a little bit of a better analysis here. The caller never mentioning those critical points and Dave never even inquiring about it was strange to me.
Exactly. Dave is a one trick pony and once you get past Baby Step #2, Ramsey folks often give horrible financial advice that cost the caller tens of thousands in unnecessary taxes and lost opportunity costs.
He had enough information to base his decision because the pension annuity would vanish after the husband dies, and there is the risk that the pension would go insolvent. A bird in the hand is worth 2 in the bush. Dave didn't need more info than that. I doubt the pension was even paying 100k per year, I bet it was less than that.
@@smithrr6 Every pension I've seen you can designate a beneficiary which is usually a spouse. You could even designate multiple beneficiaries in fact. The payout is adjusted based on this. But that's not the point. The point is the caller didn't even provide the details to compare and properly advise and Dave gave a definite advice. What's the lump sum vs the monthly payout? What rate are they giving for the lump sum? Is this a pension that has yearly inflation adjustments or is it one without any inflation adjustment? This is complicated stuff and I wish people would contact a financial advisor instead of a celebrity who has admitted multiple times himself that he isn't a financial advisor.
@@smithrr6 No, it wouldn’t vanish after the husband dies. A 100% joint and survivor annuity would pay the full payment so long as at least one of the husband or wife is alive, meaning it would pay for both of their full lifetimes. Regardless of that, however, it was pretty pathetic for Dave to never ask what the annuity payment would be. Yes, probably the lump sum is the smarter choice, but it seems worth knowing the annuity payment to rule it out.
Even though you can get better returns by taking the lump sum, most people that invest get a substantially less return because they cannot stomach it when the market goes down 50 percent when they are 70 and half of their life savings evaporates. Then they have to take the remains to live off. They miss the dead cat bounce and probably never get back into the market. That is what it’s like in the real world. A pension has mortality credits that will hopefully boost your safe month after month return. Sure your kids may not get what’s left of your pension, but I understand that you will tend to make up for that in other areas making it a good idea, in my opinion only.
@@TartarianTopG It’s important to know how stable the pension fund is. My financial advisor says if there is enough money in the fund already, there is a high probability of success, so it depends on the specific pension fund.
And this is why you still have to maintain your 6 month emergency fund even during retirement, that way when the stock market dips (temporarily) you don't have to sell assets just for living expenses, and you have the emergency fund to give it time to rebound.
I don't know, I think it's bad advice to plop all of one's retirement into a market that has routinely seen decade long flat spots. Markets are great to grow wealth over a long term, especially when adding to it weekly, not so great to maintain it when it is your only income. If you put $1million into the market in Oct 2007, it was a 6yr long dead cat bounce to see that million again. We've been really spoiled for the last decade, I'm not holding out for a DOW 72000 by 2029...
@@smithrr6 In addition to a pension and a 401k, the laddered annuities insure that money will be completely safe earning a 3 percent and above return with point to point earnings that never go down, and an emergency fund to boot just in case the market tanks totally. It’s bad when the market goes down 50 percent and you sell because you can’t stomach it.
*Lady hangs up the phone. Well hon you were right... Dave says the lump sum is actually better than the $25000 monthly pension payments. Weird that he didn't even ask me what the pension payout is so I don't know how he knew that buuuut we all know Dave is a genius so we won't question it.
Yeah, a pension paying a guaranteed 7% is pretty darn good, especially with this dude being only 55. Solid chance he has 30yrs of a 7% payout, which is actually a bit more in line with what the markets actually do; we've seen around 8.5% for the last 30yrs. If we are at a high point right now, and they plop $1.6million in and we see a flat 10yrs (which is very likely), they will kick themselves.
@@ts89540 I was more commenting to the fact that Dave didn't expend the 10 seconds of effort to even ask for the details. He had no idea what the payout percentage was and really didn't care. Just rattled off one of the prepackaged responses that he thought fit and moved on. That's one of the grosses things about the Dave; all he cares about is promoting his program whil trying to pretend like he's "helping" people.
A 100% Survivor Pension for a couple in their 50's, even at today's higher interest rates, will NOT have a payout of 7%, it will be a lot less. Furthermore, the "return of 7%" that Dave states is a return ... OF YOUR OWNT MONEY!!!
Some of the big financial stocks have still not fully recovered from 2008. Bank of America went from $52 to about $3 and just recently hit $40 for the first time since 2007, still needing a 30% gain to get back to peak. It has paid a dividend of about 3% all those years.
The payout amount has nothing to do with the pension amount. For me, best 36 month run in the last ten years of service. so for 27 years you worked as a janitor, and your last 3 as a Department Head. Your pension is 75% of the $200K/yr= $150K/yr even though your cashout is $350K you would not smart to take $350K in lieu of $150K/yr
Yeah, not sure why they didn't ask what the monthly pension would actually be. They did say 7% was the pension, so can only guess that it would be 7% of the $1.6million? That wouldn't be a terrible thing, if a guaranteed payment regardless of what the markets are doing. And at 55, with other wealth vehicles in place, I would go the pension route on this one, look at it as the safe harbor if the markets belly up on the IRA.
I think the lump sum is a better option if you have an additional source of income. My father took a $1.2 million lump sum retirement in 2004. It was his only source of income. So when the market tanked in 08 so did his lump sum pension.
I'm not opportune the gift of time, I'm advanced and I'd love to know how to invest aggressively to make short term profit, I've read about people growing upto $750K in 3months and I'd really appreciate tips on how to invest for senior citizens.
The key to big returns is not big moving stocks. It's managing risk in relationship to reward. Having the correct size on and turning your edge as many times as necessary to reach your goal. That holds true from long term investing to day trading.
So he didn't even let her say how much he would get a month. This is so stupid. How do you even do the math on something like this without looking at the numbers?
He did do the numbers. Pay out of the pension is 7% and it ends with her. Lump sum makes more in mutual funds and keeps growing. He knows what the amount would be if lump sum is $1.6 million.
@@insideoutsideupsidedown2218 .. no he has no idea what the pension would be. Public pensions are mostly factored by years of service and a % of your salary. I have a pension and it is not 7% lol. I get 80% of the avg of my best 3 years plus health insurance, 71% if I want a survivor benefit for my wife. My pension will be around 95k a year for life.
@@ryancraig4811 .. can’t assume that with a pension though, they can vary greatly. Always need to compare monthly payout to lump sum to make the best decision.
I didn’t hear her say what the pension payment is. At age 65 I am guessing it’s about $125k a year, less for joint, and less if taking it at 55. It’s an important fact to leave out of the question
Regarding generational wealth, once that IRA is passed to his kids, they will have 10 years to drain that account, pay taxes and either sit on that pile of cash or re-invest for their future.
@@wagnersaucedo5060 I understand the fact that tomorrow isn't promised to anyone, but investing today is a hard thing to do because i have no idea of how and where to invest in?
Dave - call her back It's been 3 years since this conversation. She should have (LOTS) more stocks now! as of Nov 2024 she should have 27% more - even though 2023 was negative.
Consider speaking to a fee only advisor, Fee Only Network has a search function. Too many variables to give you any suggestions without looking at your overall financial situation.
I made the mistake of taking the “sure thing” pension, since I had a lot more other money in my IRAs, in the market, and wanted to be diversified separate from the market. I regret it every month.
Why regret ? You have a lot more in your IRAs, let them grow. Don't know how much you're getting but pension and social security should take care of your everyday living.
Maybe I missed it but with a lump-sum payout the tax hit for that year is enormous. If they get to keep half of that (N.J, N.Y., etc.) it won't be nearly as large as he says.
Survivor benefit yal…. My pension payment is going to be 6k at least a month ( teamsters union ) I’ll take the monthly on that the kids can have my stock options if they’re smart they’ll spend the dividends and not touch the principle . My pension will never fold its the strongest on the west coast amount raises every contract. Might be 8 k or so by the time I retire.
Take pension every time. If you are a skilled investor then take the money and invest it yourself but don’t just start buying things you don’t need! Great video!
Absolutely. if they act like new lottery winners, they will live at their income level which will be $1.6 mil/wk for 1 week. But they have $1 mil in 401k so they are probably going to be ok taking the lump.
This market is one extremely muddled spot and the vast majority focus closer on the shiniest situations on the diagram which is the reason it will consistently stay a money lair for individuals who realize where to look. Get an assistance and have your cash work for you.
Well contingent upon your venture discipline, sure you can arrive at your objective, however in view of the looming market rectification, I believe it's presumably best you enlist a speculation mentor/F.A to guide and coach you.
Can anyone show me a growth stock mutual fund that has outperformed an S&P 500 index over 20 years? Dave always says this but I can only find ones that have outperformed it over a short time frame, but not over the long haul. But maybe there is one out there.
yup I got a few... vgt on vanguard... vwusx on vanguard, vong on vanguard, vug on vanguard. On fidelity I Got the following fscsx, fbsox, fbgrx, focpx, fspgx etc etc... all of these haver performed better than the index in the past 10 years (more like double digits rather than the 8 percent for vtsax). Not sure why people always have a hissy fit about this
@@annasimons389 Thanks for the info. I did say 20 years not 10, which does change the dynamic since some of the funds you mentioned haven't been around that long. However, it's a useful exercise to examine these, so thanks. It's easy to pick the winners in retrospect, especially ones with higher risk profiles, but looking for ones that have similar breadth of diversification and similar risk profiles of SP 500 index, I still haven't found one that has outperformed in a 20 year time-frame. But I've noticed, like you, that sometimes people have a hissy fit over my simple question. Not sure why that is.
Do not go to Mutual funds. ETF is the way to go. Invest in VOO or IVV they have .03 ER and its more liquid than Mutual funds and you control your money and you can buy and sell like a stock. Mutual funds only make Fidelity and Ramsey rich.
@@annasimons389 have you consider the ER of all the Mutual funds? You will be better off investing in VOO and IVV. Its not about how much returns the mutual funds make, its about how much do you get to pocket. If you go with all the Mutual funds you have listed you will be losing money since most of they have .70% ER and they do not pay dividend.
I would love to see some actual examples (fund names) of each one of the 4 types of mutual funds Dave Ramsey talks about that have beaten S&P 500 returns over time = that meet his criteria for investing.
Yeah, they don't exist. But if you want to do his strategy on investments, the easiest would be to just put your retirement in four index funds buckets: large, medium, small cap index funds, and then a global index fund. It will be extremely low cost for fees, and you will get good to decent returns.
What you people don't understand is by law he cannot give examples that would be considered manipulating the market and it is illegal to do that that is why he does not give exact examples it's illegal to
I went to one of his elp's and for the last 3 years my investments have earned 21%, 22.25% and this year 17.8% for an advantage of 20.56% over 3 years.Its real ..not a unicorn!
I dislike how the caller is always saying: “yes” “right” “uh huh” “yup” as if she already knows all of what Dave is telling her. If you’re so smart and already know everything, there’s no reason to call in. On the other hand, if you want Dave’s advice, shut up and listen to what he is telling you. When he stops talking, you can ask a follow up question if needed.
Not so black and white. Public pensions are usually very good and include health insurance and a monthly check. Pension is a fixed amount and not dependent on the market. In 8 years I will get 80% of my salary with health insurance until I die or 71% if I want my wife to get it after I pass. No risk in that.
What is the earliest age you can collect your lump sum? I'm 46 and received a lump sum option from my previous employer. I thought you had to be at least 55 to collect.
Yet again. This segment shows how knowledgeable Dave is about pretty much anything money beyond the baby steps. The Dave personalities would have messed up big time on this one. They would have found a way to repeat the baby steps on this call. Dave is irreplaceable, plain and simple. Only God knows where this show will end up when Dave fully retires. Not all calls is about repeating the baby steps like a tape recorder
I could not agree with you more. Dave's quest speakers in my opinion are head shrinkers by trade. They want to talk about emotions and warm and fuzzy. Not dollars and cents. We will miss dave no doubt about that.
The other personalities have no experience. The majority of them just got done buying their first home, or ride the coattails of Dave, who actually does have experience. They default to the baby steps on every call because its all they know
...and maybe the Martians invade Earth. Nobody knows, but you have to plan those things that you can instead of being fatalistic. Currency change out? Really?
He did not even ask for the monthly pension. 🤦♂️🤦♂️🤦♂️. And what is these obsession about leaving money for the kids and grandkids??? You are not the Kennedys. 🤣🤣🤣
Dave always recommends taking the lump sum without even hearing the monthly payout because like every financial advisor he can’t make a stream of income on it otherwise.
@@Ratkill9000 But Dave doesn’t even stop to consider the source of the pension or any of those details. Ever. Statistically far more people go broke trying to manage their own money.
5:08 Disagree with Dave. Pensions are limited to the amount they can guarantee in a monthly payout. I have never heard of 7%, 4 % seems to be a ceiling. Caller never gives the monthly payout amount unless she fed it to the call screener. His main point is not only still valid if I am right, he would. be even more correct to suggest lump sum.
@@tewksburydriver8624 Nice, sounds like a sweet deal, but that is different. Pensions are highly regulated, Dave knows this, I learned it first from him. If they offer someone, for example, let's say 10,000 a year in pension, the company has to have at least 250,000 invested in order to cover and it is this 250,000 number that would also be a lump sum offer.
@@coniccinoc … it all depends on the pension system, pension plan. Dave is flawed in his one way response in dealing with pensions. Often lump sum is best, but often it is not.
@@tewksburydriver8624 Not all plans are the same but they are all regulated. It used to be more of a free for all but enough pensions went bust they had to pull in the reigns. I certainly don't understand all of the rules. I took a lump sum last May, yearly guaranteed payout would have only been 4% of the lump. If they offered me 7%, I would have taken it. Enjoy your retirement : )
He didn't go deep; he literally gave a canned answer. He didn't even bother to ask the caller what the payout was because he already knew what he was going to say. Also it's fairly obvious the "personalities" don't have alot of leeway when it comes to giving out advice. Sometimes his kid pushes back a little but the others are scared too step out of line. Seems like an awesome working environment 😅
@@sootherelax2802 Index funds are a fine investment vehicle. Index funds aim to match the market, while mutual funds aim to beat the market. Yes, higher fees but actively managed. Arguments can be made for both but each have positives and negatives. I invest in mutual funds through my work’s 457 plan and they have beat the market almost every year. Index funds are great if you plan to stay long term (at least 5 years). Otherwise, investing and withdrawing is a plan for financial disaster. Index funds are too easy to pull out of which is why I don’t recommend them for an average person, because they may pull that money out to use for unnecessary purchases or expenses. Most mutual funds are in retirement accounts that force you to stay in long term or otherwise you’ll get crushed with penalty fees and taxes.
@@sootherelax2802 Some do. I've got one mid market fund that has been doing well for several years. Their fee is 1.2%, but their returns are more than 1.2% more than the other options in my 401k...very limited.
@@CBitt1 may I ask what are some of the mutual funds you are in, I have a 457 also and invested in some mutual funds but kind of hard to find decent ones with a relatively lower expense ratio
I’m not a big Dave Ramsey fan at all. That said, stable income that you can count on helps you sleep well at night. I hire a fiduciary that I trust way more than a smart vestor that will get commission on me every month regardless of how they perform for me. Dave is about Dave.
@@RenzoRosales_FL very good question. I guess this particular topic sparked my interest. FYI, I am a regular person getting ready to retire with a pension . My financial adviser thinks differently, and obviously I trust what he says more than what Dave said. That’s all
@@RenzoRosales_FL Btw, I like using the bucket retirement system that contains a pension, a 401k, real estate , and annuities in addition to delaying social security until age 70. This has a high probability that I will successfully not run out of money if for some reason I live to 100. Just a different way of doing things.
@@KatsDad I wish you well in your retirement years and with your financial situation, people shouldn't ask a radio personality about random advice and assume it is ideal for their situation.
Always take the lump sum . I will go 100% Bitcoin and take a 50%LVT loan on it and sit on $800k cash in case there's a crash or to buy the dip . Bitcoin has grown 300% per year for the last 13 years , out pacing the stock market for over a decade . I'm in my 30s so my strategy won't work for 50 plus year olds. Plus risk makes me feel alive . YOLO
Assuming all goes I well I would have a min. $3.2million by 2022 . Sell half and put in $1.6 into the stock market. Now I have $1.6 in Crypto and $1.6 in the Stock market along with $800k cash . This is what the super wealth do . They leverage there proven assets to buy more assets . Rinse and repeat
@@dsanti4069 No, the super wealthy do not do that. They don't leverage the proven assets. Future bankrupt people, who are overconfident, use leverage like that. If 25% recession hits, you will be selling more of those assets into the freefall, and loose your "proven base" to the margin loan. That is what happened in 1929, 1970's, 1989, 1999, 2001, and 2008. Many people get wiped out doing what you suggested. You never 50% leverage your assets in the stock market.
@@vectorhacker-r2 Depends on the years. If they take your advice in mid 2007, they would get no return until late 2013. Nobody really know what the future holds, I'm not really bullish on seeing a DOW 72000 by 2029. But guaranteed 7% on whatever is in their pension might be a much better investment for the next 30yrs they have.
Nix the guesswork and scrolling. We’ll connect you with investment pros we trust: bit.ly/3kwqrhf
I came across your channel through this video-case studies are incredibly valuable, and I'm eager to see more in the future! Building wealth involves establishing routines, like consistently setting aside funds at regular intervals for smart investments.
People believe their currency has the worth it does because they have no other option. Even in a hyperinflationary environment, individuals must continue to use their hyperinflationary currency since they likely have minimal access to other currencies or gold/silver coins.
This aligns perfectly with my desire to organize my finances prior to retirement. Could you provide me with access to your advisor?
She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing.
For me, always take the lump sum. You can run all the different math calculations you want. The bottom line is you do not know at what point in time you are going to die. I want control over the money. I want control over how it is invested and distributed.
Depends on how much the payments are. If the payments are $300k a year, you'd be a lot better off taking the yearly payments.
@@SenorJoeBiden if payments are 300K a year the lump sum is going to be relative to that....perhaps $4M or $5M. For a 1.6M payout like in this video, I'm guessing the annual payout would be around $100K.
Especially if it's a business that goes bankrupt and then your pension could be reduced or lost. Better to take it all when you can.
Never, ever, take the monthly payments option. Not only does the lump sum stay in your family after your death, but it puts you in the driver's seat of your life. Your pension payments are pulled from an account that does NOT have enough money to make all of the payments they've promised to make. If everything is OK forever, this won't be a problem because the company has the rest of your life to come up with the cash each month. If the investment manager of the pension fund makes bad decisions and loses a lot of money or if the company winds up being mismanaged and goes under, those future payments are now in jeopardy. The fact that you are owed a set amount per month means nothing if there is no cash to give to you.
Take the lump sum and you are guaranteed to get everything you are owed.
Pbgc will insure private pensions.
I am unsure if my 401(k) and IRA will provide a stable future. i need an approach that will align with my risk tolerance and financial goals, i set aside $1m to achieve this. Do you suggest i get into stocks or buy a rental property?
Research dividend aristocrats. Pick six to ten from that list. Those companies have a track record of 25+ years of paying dividends. Also, its advisable you work with a financial advisor to help set up a well-structured portfolio.
I agree. Based on my experience working with a financial manager, I currently have ($2million) in a well-diversified portfolio that has experienced exponential growth from when i started. It's not only about having money to invest in stocks, but you also need to be knowledgeable, persistent, and have strong hands to back it up.
Your manager must be exceptionally good. How I can get in touch? My retirement portfolio's decline is a concern, and I could use some guidance.
I work with Sonya Lee Mitchell as my fiduciary advisor. Simply look up the name. You would discover the information you needed to schedule an appointment.
Thank you for this tip. It was easy to find your coach. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume.
Index invest, diversify by sector and country, use registered accounts first (exclusively), stay away from margin, dollar-cost-average, wait 20-30 years....profit. Its still shocking that investing is not really taught at the high school level. If I knew at 19 what I know now.....retirement at 40 would have been easy peasy.
I'm pretty sure this is precisely why it isn't taught in school. The system requires workers to keep that GDP moving,. Imagine if everyone retired in 20 years and quite mindless consumerism. The whole thing would collapse. It will probably collapse anyway as robotics and AI scoop up more jobs than they create.
Is registered account a Canadian only thing？For US I only heart of Roth IRA/401K and those have annual deposit limits (which you should max out)
@@qiuyueshu5459 I wish I learnt about selling call options a long time ago because this strategy and real estate is how I become wealthy. In my opinion trading ETF options and reinvesting is something that should be taught in schools.
I want to invest but I don't want to benefit from companies in the oil industry and unethical companies like Facebook. How can I invest in index funds and avoid these kind of companies?
Growing up in the Midwest we learned about investing super young. I’m 46 and right now I’m projecting to retire between 57 and 60. Obviously not stop working completely because I’d go insane. But be able to live off of ~ $4,000 a month without touching the principle if I need to start using it to follow whatever dream I want.
Dave's knowledge and advice are PURE GOLD!!!
Dave needs to take a 3-hour course on Defined Benefit Pensions.
You cannot compare the two options (lump sum or pension payments) without knowing both sides of the equation. Dave immediately goes to the "take the lump sum" route without asking about the pension payment amounts. Another fact: the great unknown factor in this equation is how long the recipients will live. Pension planners, social security, insurance actuaries, etc., all use some type of actuarial tables to base their payments. "The Money Guy Show" has a very good discussion on this subject and actually goes into the mathematical calculations.
The Secure Act of 2019 also changed the inheritance rules regarding IRA's, eliminating the "stretch provision" of 401k's and establishing a ten year window for 401k distributions. This means that withdrawal strategies should be a discussion in the overall retirement framework.
A bird in the hand is worth two in the bush
Take the $1.6 million dollars and invest it in the stock market. Average return is around 10%, or $160,000.00
@@KC-dr3cg Sometimes you need to hit the bush.
@@KC-dr3cg Well, there was no mention on what the pension is actually worth, only that they would get 7% a yr of it. The lump sum payment of a pension is almost always much less than what is in the pension, usually by a factor of 2. So, we can only assume that the pension would be 7% of $3.2million. I'd rather have a guaranteed $224k/yr until both myself and my spouse die (which could be 30+yrs from now), than having to somehow get a year over year return of 13+%, regardless of market fluctuations.
@@zodiacdana If the economy is only going to grow 3-4% a year, you are not going to generate 10% returns annually for 30 years in an index fund.
'Go on, take the money and run."
You should almost always want control of the money. $1.6 million is guaranteed if you take the lump sum. If you take the payouts, they can change the deal later, and you have no control over it.
This argument is horrendously wrong. First we need to separate this between public pension and private.
Public - the vast majority of states either have no means to change pension benefits without a constitutional change or have an extremely high bar to reach to change benefits. They are governed by state constitution, contract law, or property law. NY, where the lady indicated she was in has constitutional protection for pension benefits. Meaning, they would have to amend the constitution to change pension benefits. Even if this was a different state, most have an extremely high bar to change benefits under contract law and bankruptcy. So, it would be hard to do it and cost a lot for legal fees. Not a logical place to cut expenditures.
If this is a private pension - they cannot just change the payment amount. That isn’t how ERISA law works. Note, ERISA only applies to private corporation’s pension plans, it doesn’t apply to state, local, or church plans.
For private plans, the company doesn’t have any means to change the payment that is not automatically tied to the inflation rate. The only way it could change is a) if the company goes under, then the obligation would go to the PBGC or 2) the gov’t changes the laws
#1 a very rare occurrence. Benefits are impacted when plans don’t have the funds to meet obligations and then the benefit exceeds the PBGC max. The max could play a role here and hurt them, but it is very rare a company dumps their plan on the PBGC. Plus, private plans are pretty well funded today given new rule changes. Note, I said private plans, not public ones.
#2 is true of any law and retirement vehicle. It is no more risky here. Also, the law they’d change, as noted before is ERISA. This is the same law that governs the 401k. So, the argument they could change the law would be directly applicable to the 401k. It is literally the same law.
I would take the 1.6 up front and invest and build interest
Especially if the company goes belly up!
Companies that can just write a check for $1M don't go belly up. Sheesh!
I had a similar offer when my company was bought out (well, I was only being offered $40,000 vs a lifetime pension when I turn 65.) The fact that my company was pushing it so hard, made me think very carefully about it. A little math, I quickly figured out if I lived to the average age of 78 (and a few years below that), I would be better off taking the pension than the lump-pay out. Sure, if I die today, I get nothing. But statistically, I won't. Which is why the new company was hoping to get rid of the pensions by offering buy-outs to people. Now, I was, and am, completely debt free. If I had debt at the time, I may have made a different decision, in order to pay off the debt.
Yikes, that seems like a terrible buyout offer. As much as I am a "take the lump sum always" type of guy, I'd have to really run the numbers on this one. If you're in your 20's, that $40k could really grow, but if you are older it wouldn't have as much time. The more I think about it, because I really dislike pensions, and because I'm a "bird in the hand" type of guy, I think would still take the $40k.
Same
78? Psh. I plan to live to at least untill 121 and in good health. Y'all discounting your life span. Stop eating junk food.
@@Scott-got-caught I'm going by the average--obviously 50% of people will live longer than the average. But for actuarial purposes, the average makes sense to use.
@@thelogicaldanger actually 50% will live longer than the MEDIAN. That's not how average works
I’m surprised he didn’t ask her what the monthly amount would be.
Please use that caller mute button.
I would pack up from NY, go to Florida (save on state taxes and cost of living), and pay myself $5k a month to live like a king.
Need more than 5k for south Florida 😂
@@young5ive426 North Florida then.
Not everyone wants to live in Florida. Staying in the New York area, they could move to New Hampshire for no state taxes and no sales tax.
Good luck with those hurricanes 🌀
Not many of those in nh
In my opinion, diversify with mutual funds: Dividend Stocks, Corporate Bonds, International, and more.
As a soon retiree, keeping my 401k on course after a rocky 2024 is top priority. I have been reading of lnvestors making up to 250k ROI in this current crashing market, any recommendations to scale up my ROI before retirement will be highly appreciated.
The current market might give opportunities to maximize profit within a short term, but in order to execute such strategy , you must be a skilled practitioner.
Having an lnvestment adviser is the best way to go about the market right now, especially for near retirees, I've been in touch with a coach for awhile now mostly cause I lack the depth knowledge and mental fortitude to deal with these recurring market conditions, I nettd over $220K so far, that made it clear there's more to the market that we avg joes don't know
I’ve actually been looking into advisors lately, the news I’ve been seeing in the market hasn’t been so encouraging. who’s the person guiding you?
My financial advisor is Annette Marie Holt” I found her on a CNBC interview where she was featured and I reached out to her afterwards via her website
Thanks a lot for this recommendation. I just looked her up, and I have sent her an email. I hope she gets back to me soon.
My public pension pays 17.5% annually of what the lump sum would have been. Passed on to my spouse when I die. COLA adjusted also.
You’re lucky,unfortunately many states are going broke because of pension deals like that.
I would say YES to lumpsum!!!
Hard to say without knowing what the annual pension would be. Not to mention if you take the lump sum it may not include health insurance, which if you have a public pension you get health insurance covered up until age 65 when you go on Medicare.
@@tewksburydriver8624 $280/mo from the State, $1100/mo from the City, I pay $550/mo, almost $2K/mo for healthcare.
take the lump sum lose $1400/mo
I'm not sure how you can give advice to take the lump sum when the caller never once mentioned how much per year the pension paid out or other points such as whether or not the pension adjusts with inflation. Maybe the lump sum is the better option but I would have loved to see a little bit of a better analysis here. The caller never mentioning those critical points and Dave never even inquiring about it was strange to me.
Exactly. Dave is a one trick pony and once you get past Baby Step #2, Ramsey folks often give horrible financial advice that cost the caller tens of thousands in unnecessary taxes and lost opportunity costs.
With $1million in his 401k too the $1.4 million to roll over may be enough if there is low debt and own home outright.
He had enough information to base his decision because the pension annuity would vanish after the husband dies, and there is the risk that the pension would go insolvent. A bird in the hand is worth 2 in the bush. Dave didn't need more info than that. I doubt the pension was even paying 100k per year, I bet it was less than that.
@@smithrr6 Every pension I've seen you can designate a beneficiary which is usually a spouse. You could even designate multiple beneficiaries in fact. The payout is adjusted based on this. But that's not the point. The point is the caller didn't even provide the details to compare and properly advise and Dave gave a definite advice. What's the lump sum vs the monthly payout? What rate are they giving for the lump sum? Is this a pension that has yearly inflation adjustments or is it one without any inflation adjustment? This is complicated stuff and I wish people would contact a financial advisor instead of a celebrity who has admitted multiple times himself that he isn't a financial advisor.
@@smithrr6 No, it wouldn’t vanish after the husband dies. A 100% joint and survivor annuity would pay the full payment so long as at least one of the husband or wife is alive, meaning it would pay for both of their full lifetimes. Regardless of that, however, it was pretty pathetic for Dave to never ask what the annuity payment would be. Yes, probably the lump sum is the smarter choice, but it seems worth knowing the annuity payment to rule it out.
Even though you can get better returns by taking the lump sum, most people that invest get a substantially less return because they cannot stomach it when the market goes down 50 percent when they are 70 and half of their life savings evaporates. Then they have to take the remains to live off. They miss the dead cat bounce and probably never get back into the market. That is what it’s like in the real world. A pension has mortality credits that will hopefully boost your safe month after month return. Sure your kids may not get what’s left of your pension, but I understand that you will tend to make up for that in other areas making it a good idea, in my opinion only.
The company can end the pension at any point that they want
@@TartarianTopG It’s important to know how stable the pension fund is. My financial advisor says if there is enough money in the fund already, there is a high probability of success, so it depends on the specific pension fund.
And this is why you still have to maintain your 6 month emergency fund even during retirement, that way when the stock market dips (temporarily) you don't have to sell assets just for living expenses, and you have the emergency fund to give it time to rebound.
I don't know, I think it's bad advice to plop all of one's retirement into a market that has routinely seen decade long flat spots. Markets are great to grow wealth over a long term, especially when adding to it weekly, not so great to maintain it when it is your only income. If you put $1million into the market in Oct 2007, it was a 6yr long dead cat bounce to see that million again. We've been really spoiled for the last decade, I'm not holding out for a DOW 72000 by 2029...
@@smithrr6 In addition to a pension and a 401k, the laddered annuities insure that money will be completely safe earning a 3 percent and above return with point to point earnings that never go down, and an emergency fund to boot just in case the market tanks totally. It’s bad when the market goes down 50 percent and you sell because you can’t stomach it.
*Lady hangs up the phone. Well hon you were right... Dave says the lump sum is actually better than the $25000 monthly pension payments. Weird that he didn't even ask me what the pension payout is so I don't know how he knew that buuuut we all know Dave is a genius so we won't question it.
Yeah, a pension paying a guaranteed 7% is pretty darn good, especially with this dude being only 55. Solid chance he has 30yrs of a 7% payout, which is actually a bit more in line with what the markets actually do; we've seen around 8.5% for the last 30yrs. If we are at a high point right now, and they plop $1.6million in and we see a flat 10yrs (which is very likely), they will kick themselves.
@@ts89540 I was more commenting to the fact that Dave didn't expend the 10 seconds of effort to even ask for the details. He had no idea what the payout percentage was and really didn't care. Just rattled off one of the prepackaged responses that he thought fit and moved on. That's one of the grosses things about the Dave; all he cares about is promoting his program whil trying to pretend like he's "helping" people.
A 100% Survivor Pension for a couple in their 50's, even at today's higher interest rates, will NOT have a payout of 7%, it will be a lot less. Furthermore, the "return of 7%" that Dave states is a return ... OF YOUR OWNT MONEY!!!
No. Lump sum 1.6M invested at 8 to 12% is the better deal.
@@laz7354you ever hear of sequence of returns?
Some of the big financial stocks have still not fully recovered from 2008. Bank of America went from $52 to about $3 and just recently hit $40 for the first time since 2007, still needing a 30% gain to get back to peak. It has paid a dividend of about 3% all those years.
The payout amount has nothing to do with the pension amount.
For me, best 36 month run in the last ten years of service.
so for 27 years you worked as a janitor, and your last 3
as a Department Head.
Your pension is 75% of the $200K/yr= $150K/yr
even though your cashout is $350K
you would not smart to take $350K in lieu
of $150K/yr
Yeah, not sure why they didn't ask what the monthly pension would actually be. They did say 7% was the pension, so can only guess that it would be 7% of the $1.6million? That wouldn't be a terrible thing, if a guaranteed payment regardless of what the markets are doing. And at 55, with other wealth vehicles in place, I would go the pension route on this one, look at it as the safe harbor if the markets belly up on the IRA.
Solid advice
I think the lump sum is a better option if you have an additional source of income. My father took a $1.2 million lump sum retirement in 2004. It was his only source of income. So when the market tanked in 08 so did his lump sum pension.
The future payment on the pension monthly is much higher than the lump sum.
Dollar is collapsing. A decent monthly pension today might only pay for a tank of gas tomorrow.
What a terrific problem to have 😀
True but this did not happen by accident.
I'm not opportune the gift of time, I'm advanced and I'd love to know how to invest aggressively to make short term profit, I've read about people growing upto $750K in 3months and I'd really appreciate tips on how to invest for senior citizens.
The key to big returns is not big moving stocks. It's managing risk in relationship to reward. Having the correct size on and turning your edge as many times as necessary to reach your goal. That holds true from long term investing to day trading.
@Suzanne Jared Thanks but I don't know any professional broker. Please point me to the right directly I'll appreciate that.
@Suzanne Jared Wow impressive, I found her website and left a message for her. I hope she reply me. thanks
SCAM
Scam bots. No way this comment would have 62 likes, it’s not even good.
So he didn't even let her say how much he would get a month. This is so stupid. How do you even do the math on something like this without looking at the numbers?
Dave probably has a good idea about what the payments are if the lump sum is $1.6 mil. But I had this thought at first too.
He did do the numbers. Pay out of the pension is 7% and it ends with her. Lump sum makes more in mutual funds and keeps growing. He knows what the amount would be if lump sum is $1.6 million.
Good point.. you'd need to do the math on both scenarios. Here's a tip.. if you're horrible with money take the monthly pension.
@@insideoutsideupsidedown2218 .. no he has no idea what the pension would be. Public pensions are mostly factored by years of service and a % of your salary. I have a pension and it is not 7% lol. I get 80% of the avg of my best 3 years plus health insurance, 71% if I want a survivor benefit for my wife. My pension will be around 95k a year for life.
@@ryancraig4811 .. can’t assume that with a pension though, they can vary greatly. Always need to compare monthly payout to lump sum to make the best decision.
1.6 million 1 million 401K and eventually social security. They are going to be okay.
I didn’t hear her say what the pension payment is. At age 65 I am guessing it’s about $125k a year, less for joint, and less if taking it at 55. It’s an important fact to leave out of the question
Regarding generational wealth, once that IRA is passed to his kids, they will have 10 years to drain that account, pay taxes and either sit on that pile of cash or re-invest for their future.
I don't know who needs to hear this, you've got to stop saving money. Invest some part of it, if you really want financial freedom.
Investing for today is priceless because tomorrow isn't promised, trading bit-coins, gold, silver and crypto secures a better tomorrow.
Anyone who is not investing now is missing a tremendous opportunity, i really fear for a future without an investment.
@@wagnersaucedo5060 I understand the fact that tomorrow isn't promised to anyone, but investing today is a hard thing to do because i have no idea of how and where to invest in?
The world have advanced a whole lot that you must not be a pro to make money out the market.
That's so true, investment saves.
Yall have done a great job for your ages. Take the lump sum and start planning the places you want to travel in retirement 🌞
Dave - call her back It's been 3 years since this conversation. She should have (LOTS) more stocks now! as of Nov 2024 she should have 27% more - even though 2023 was negative.
take the cash !! done deal
Would this be the same with an annuity?
Consider speaking to a fee only advisor, Fee Only Network has a search function. Too many variables to give you any suggestions without looking at your overall financial situation.
I made the mistake of taking the “sure thing” pension, since I had a lot more other money in my IRAs, in the market, and wanted to be diversified separate from the market. I regret it every month.
Why the regret 🤔
Why regret ?
You have a lot more in your IRAs, let them grow.
Don't know how much you're getting but pension and social security should take care of your everyday living.
What if the monthly pension comes with medical paid for by your company? Do you still take the Lump sum and pick up medical somewhere else?
Medical is separate, at least it was for my company.
Dave's experience is shining through here
Except he still can't get off the mutual fund wagon
@@Soljarag5 he's gotten been his share of the commissions 😂
Maybe I missed it but with a lump-sum payout the tax hit for that year is enormous. If they get to keep half of that (N.J, N.Y., etc.) it won't be nearly as large as he says.
The lump sum would be rolled over to an IRA with no immediate tax implications.
@@rickdunn3883 I did not know that (obviously 😊). Thanks for the reply.
No mention of what her retirement funds are for her past or current employment
Survivor benefit yal…. My pension payment is going to be 6k at least a month ( teamsters union ) I’ll take the monthly on that the kids can have my stock options if they’re smart they’ll spend the dividends and not touch the principle .
My pension will never fold its the strongest on the west coast amount raises every contract. Might be 8 k or so by the time I retire.
I wonder why Dave would say take the lump sum without all the numbers? follow the money. "Buyer Beware."
Take the entire amount. They might make a shady background deal later and leave you hanging.
Take pension every time. If you are a skilled investor then take the money and invest it yourself but don’t just start buying things you don’t need! Great video!
Absolutely. if they act like new lottery winners, they will live at their income level which will be $1.6 mil/wk for 1 week. But they have $1 mil in 401k so they are probably going to be ok taking the lump.
This market is one extremely muddled spot and the vast majority focus closer on the shiniest situations on the diagram which is the reason it will consistently stay a money lair for individuals who realize where to look. Get an assistance and have your cash work for you.
Well contingent upon your venture discipline, sure you can arrive at your objective, however in view of the looming market rectification, I believe it's presumably best you enlist a speculation mentor/F.A to guide and coach you.
That's a pen, not a lollipop. You don't know where it's been lasts.
"obviously"
Can anyone show me a growth stock mutual fund that has outperformed an S&P 500 index over 20 years? Dave always says this but I can only find ones that have outperformed it over a short time frame, but not over the long haul. But maybe there is one out there.
yup I got a few... vgt on vanguard... vwusx on vanguard, vong on vanguard, vug on vanguard. On fidelity I Got the following fscsx, fbsox, fbgrx, focpx, fspgx etc etc... all of these haver performed better than the index in the past 10 years (more like double digits rather than the 8 percent for vtsax). Not sure why people always have a hissy fit about this
@@annasimons389 Thanks for the info. I did say 20 years not 10, which does change the dynamic since some of the funds you mentioned haven't been around that long. However, it's a useful exercise to examine these, so thanks. It's easy to pick the winners in retrospect, especially ones with higher risk profiles, but looking for ones that have similar breadth of diversification and similar risk profiles of SP 500 index, I still haven't found one that has outperformed in a 20 year time-frame. But I've noticed, like you, that sometimes people have a hissy fit over my simple question. Not sure why that is.
Do not go to Mutual funds. ETF is the way to go. Invest in VOO or IVV they have .03 ER and its more liquid than Mutual funds and you control your money and you can buy and sell like a stock. Mutual funds only make Fidelity and Ramsey rich.
@@annasimons389 have you consider the ER of all the Mutual funds? You will be better off investing in VOO and IVV. Its not about how much returns the mutual funds make, its about how much do you get to pocket. If you go with all the Mutual funds you have listed you will be losing money since most of they have .70% ER and they do not pay dividend.
Dave should have muted caller. She has to validate every sentence he says. Yep. Uh huh. Right. Annoying interruption .
I would love to see some actual examples (fund names) of each one of the 4 types of mutual funds Dave Ramsey talks about that have beaten S&P 500 returns over time = that meet his criteria for investing.
Those examples are like unicorns my friend , non existent
Yeah, they don't exist. But if you want to do his strategy on investments, the easiest would be to just put your retirement in four index funds buckets: large, medium, small cap index funds, and then a global index fund. It will be extremely low cost for fees, and you will get good to decent returns.
What you people don't understand is by law he cannot give examples that would be considered manipulating the market and it is illegal to do that that is why he does not give exact examples it's illegal to
@@jacoblynch9862
I went to one of his elp's and for the last 3 years my investments have earned 21%, 22.25% and this year 17.8% for an advantage of 20.56% over 3 years.Its real ..not a unicorn!
I dislike how the caller is always saying: “yes” “right” “uh huh” “yup” as if she already knows all of what Dave is telling her. If you’re so smart and already know everything, there’s no reason to call in. On the other hand, if you want Dave’s advice, shut up and listen to what he is telling you. When he stops talking, you can ask a follow up question if needed.
I think it's her way of saying, 'I'm listening.'
I think she just comes across as hyper.
That’s just how people talk in the north east. We don’t consider it rude because it means your actually paying attention.
Holy Mackeral
Yes
Take the lump sum always! Invest it! Some dividend stocks, index funds. Done.
She's scared of the market.. they won't invest it.
Not so black and white. Public pensions are usually very good and include health insurance and a monthly check. Pension is a fixed amount and not dependent on the market. In 8 years I will get 80% of my salary with health insurance until I die or 71% if I want my wife to get it after I pass. No risk in that.
What is the earliest age you can collect your lump sum? I'm 46 and received a lump sum option from my previous employer. I thought you had to be at least 55 to collect.
didn't return in a short term in 2007 and 2008, it took years to return.
From a tax standpoint, ETFs are better than mutual funds.
Lump sum for me. You have more control of the income you receive.
Rice and beans, beans and rice! 🤣
Inflation Dave, inflation!!!!
Yet again. This segment shows how knowledgeable Dave is about pretty much anything money beyond the baby steps. The Dave personalities would have messed up big time on this one. They would have found a way to repeat the baby steps on this call. Dave is irreplaceable, plain and simple. Only God knows where this show will end up when Dave fully retires. Not all calls is about repeating the baby steps like a tape recorder
Well said.
Preach! George literally just repeats the baby steps every time without fail and it is so old! No additional/new insight into the situation at all!
I could not agree with you more. Dave's quest speakers in my opinion are head shrinkers by trade. They want to talk about emotions and warm and fuzzy. Not dollars and cents. We will miss dave no doubt about that.
I think the other hosts are so afraid of saying anything that’s contrary to what Dave would think they play it safe
The other personalities have no experience. The majority of them just got done buying their first home, or ride the coattails of Dave, who actually does have experience. They default to the baby steps on every call because its all they know
Retired at 55? Must be a government worker
retired government worker here at 58. thank you very much
they is what they call a rule of 55 look it up
This just might be the single best piece of advice I've ever garnered from Dave....
Buy Tesla, Amazon, Google, Apple,?
Lump sum or someone else will control your family’s financial destiny.
Casey the Spammer wants to control your finances with stupid advice!
Casey the spammer spotted spamming on Minority Mindset!
What if you don’t have a family???
I dont understand the "Casey the spammer" comments. I've seen your comments for months, and never saw one that's spammy or inappropriate.
@@bravotrades5614 - He jumps to certain financial videos, doesn’t watch the videos, and makes a comment. He is fishing for likes and subs.
What happens to people’s retirement funds Aswell their mortgages, Anything financial if the economy crashes and maybe we have a currency change out?
...and maybe the Martians invade Earth. Nobody knows, but you have to plan those things that you can instead of being fatalistic. Currency change out? Really?
I don’t have any family so pay me for the rest of my life 😊
He did not even ask for the monthly pension. 🤦♂️🤦♂️🤦♂️. And what is these obsession about leaving money for the kids and grandkids??? You are not the Kennedys. 🤣🤣🤣
Please explain how it doubles every seven years
Fake Ramsey numbers where you earn double digit returns every year forever and never have a bear market.
On average the s&p500 doubles every 7 years. This already includes bear markets over the last +40 yrs
@@monsterous289 The S&P doubling every 7 years on average by no way means your account balance does.
@@abark If you are in and S&P index fund and reinvest the dividend/gains it would.
@@abark um... if you didn't take any out it would.. where do you think it goes? Does it unlock the door and slip out of the account?
Dave always recommends taking the lump sum without even hearing the monthly payout because like every financial advisor he can’t make a stream of income on it otherwise.
Also, if the company goes under or gets absorbed into another, chances are your monthly checks go away. Nothing is too big to fail.
@@Ratkill9000 But Dave doesn’t even stop to consider the source of the pension or any of those details. Ever. Statistically far more people go broke trying to manage their own money.
Yep, total con artist.
He already knows what the monthly payout will be based on the lump sum distribution.
@@insideoutsideupsidedown2218 That’s not true at all. It’s totally different for every organization.
Very annoying caller. Interrupter.
5:08 Disagree with Dave.
Pensions are limited to the amount they can guarantee in a monthly payout. I have never heard of 7%, 4 % seems to be a ceiling. Caller never gives the monthly payout amount unless she fed it to the call screener.
His main point is not only still valid if I am right, he would. be even more correct to suggest lump sum.
I get 80% of my salary for life, not 7 or 4% of anything. Not all pensions are the same.
@@tewksburydriver8624 Nice, sounds like a sweet deal, but that is different. Pensions are highly regulated, Dave knows this, I learned it first from him. If they offer someone, for example, let's say 10,000 a year in pension, the company has to have at least 250,000 invested in order to cover and it is this 250,000 number that would also be a lump sum offer.
@@coniccinoc … it all depends on the pension system, pension plan. Dave is flawed in his one way response in dealing with pensions. Often lump sum is best, but often it is not.
@@tewksburydriver8624 Not all plans are the same but they are all regulated. It used to be more of a free for all but enough pensions went bust they had to pull in the reigns. I certainly don't understand all of the rules. I took a lump sum last May, yearly guaranteed payout would have only been 4% of the lump. If they offered me 7%, I would have taken it. Enjoy your retirement : )
@@coniccinoc … you too
Great job by Dave on this call. The Ramsey personalities just don’t go this deep on the fly.
They don’t know anything. All they can do is regurgitate the baby steps.
Deep? He didn't even ask the monthly amount
They get 100’s of calls a day, probably talk to dozens, this is separate from the actual show. They don’t just put cold calls on air.
He didn't go deep; he literally gave a canned answer. He didn't even bother to ask the caller what the payout was because he already knew what he was going to say. Also it's fairly obvious the "personalities" don't have alot of leeway when it comes to giving out advice. Sometimes his kid pushes back a little but the others are scared too step out of line. Seems like an awesome working environment 😅
I love Dave and his advise until he mentions "smartvestor pros". That's when i cringe 😬
Like 9 out of 10 years, mutual funds do not beat the market.
Except for all of the mutual funds that do, which are almost all of the well managed funds
Index funds are better always. Mutual funds have such high fees
@@sootherelax2802 Index funds are a fine investment vehicle. Index funds aim to match the market, while mutual funds aim to beat the market. Yes, higher fees but actively managed. Arguments can be made for both but each have positives and negatives. I invest in mutual funds through my work’s 457 plan and they have beat the market almost every year. Index funds are great if you plan to stay long term (at least 5 years). Otherwise, investing and withdrawing is a plan for financial disaster. Index funds are too easy to pull out of which is why I don’t recommend them for an average person, because they may pull that money out to use for unnecessary purchases or expenses. Most mutual funds are in retirement accounts that force you to stay in long term or otherwise you’ll get crushed with penalty fees and taxes.
@@sootherelax2802 Some do. I've got one mid market fund that has been doing well for several years. Their fee is 1.2%, but their returns are more than 1.2% more than the other options in my 401k...very limited.
@@CBitt1 may I ask what are some of the mutual funds you are in, I have a 457 also and invested in some mutual funds but kind of hard to find decent ones with a relatively lower expense ratio
Just buy Tesla stock or Bitcoin 🚀
This.
I’m not a big Dave Ramsey fan at all. That said, stable income that you can count on helps you sleep well at night. I hire a fiduciary that I trust way more than a smart vestor that will get commission on me every month regardless of how they perform for me. Dave is about Dave.
Why are you on his channel?
@@RenzoRosales_FL very good question. I guess this particular topic sparked my interest. FYI, I am a regular person getting ready to retire with a pension . My financial adviser thinks differently, and obviously I trust what he says more than what Dave said. That’s all
@@RenzoRosales_FL Btw, I like using the bucket retirement system that contains a pension, a 401k, real estate , and annuities in addition to delaying social security until age 70. This has a high probability that I will successfully not run out of money if for some reason I live to 100. Just a different way of doing things.
@@KatsDad I wish you well in your retirement years and with your financial situation, people shouldn't ask a radio personality about random advice and assume it is ideal for their situation.
I agreed
Always take the lump sum . I will go 100% Bitcoin and take a 50%LVT loan on it and sit on $800k cash in case there's a crash or to buy the dip . Bitcoin has grown 300% per year for the last 13 years , out pacing the stock market for over a decade . I'm in my 30s so my strategy won't work for 50 plus year olds. Plus risk makes me feel alive . YOLO
Assuming all goes I well I would have a min. $3.2million by 2022 . Sell half and put in $1.6 into the stock market. Now I have $1.6 in Crypto and $1.6 in the Stock market along with $800k cash . This is what the super wealth do . They leverage there proven assets to buy more assets . Rinse and repeat
@@dsanti4069 No, the super wealthy do not do that. They don't leverage the proven assets. Future bankrupt people, who are overconfident, use leverage like that. If 25% recession hits, you will be selling more of those assets into the freefall, and loose your "proven base" to the margin loan. That is what happened in 1929, 1970's, 1989, 1999, 2001, and 2008. Many people get wiped out doing what you suggested. You never 50% leverage your assets in the stock market.
"Always take the lump sum..." and "I'm in my 30s so my strategy won't work for 50 plus year olds..."
New York public service for ya.
No
This lady needs to lay off the coffee. Slow down already...
They are young. Both can find part time jobs
A reasonably healthy person might be a lot better off with a pension.
No, don't take the lump sum.
Why? I’m curious about why. I think they should because they can invest it index funds and get good returns.
@@vectorhacker-r2 And pensions are already invested.
@@vectorhacker-r2 Depends on the years. If they take your advice in mid 2007, they would get no return until late 2013. Nobody really know what the future holds, I'm not really bullish on seeing a DOW 72000 by 2029. But guaranteed 7% on whatever is in their pension might be a much better investment for the next 30yrs they have.