If you happen to turn on your radio any time from 1:00 PM EST to 4:00 PM EST and move the dial around a bit, chances are you might hear a southern gentlemen yelling at his callers, no, this is not Rush Limbaugh blasting his political opponents, It’s Dave Ramsey telling listeners to “act your wage” and preaching his Christian conservative financial advice that many people don’t even know is an option in this day and age.
The Dave Ramsey show is syndicated on almost 300 stations nation wide, and is the largest independently promoted radio show in the nation. It is also available on both XM and Sirius satellite radio, as well as being streamed on the internet, and available in podcast form as well.
How David L. Ramsey III got started in the radio business is rather an interesting story. In college he studied finance and real-estate, and soon became very wealthy in a niche market in foreclosure real estate. At 26, his company had built a real estate portfolio worth $4 million dollars. However because the Tax Reform Act of 1986, the real estate market slumped and one of Ramsey’s largest investors was sold and the bank insisted he pay 1.2 million dollars worth of short term notes within 90 days, forcing Ramsey into bankruptcy.
As he likes to be called on the radio, Dave vowed never again to return to debt and began counseling couples at his local church and in 1992 he created his first book, dubbed “Financial Peace.” During that same year a local radio station, WWTN filed for Chapter 11 bankruptcy, and Ramsey agreed to host a show on money matters for a month without pay. In 1995 WTN was bought out and the parent company began promoting his radio show and the show was syndicated and his book sales and show ratings began to skyrocket becoming what it is today.
On his show, Ramsey teaches a lot of very unconventional financial advice, which focuses around avoiding debt, delaying pleasure, minimizing risk and saving money. Ramsey and his company developed a financial game plan that he has taught his listeners to follow, called “The Baby Steps.” Before you can walk, you have to crawl. In the Dave’s teaching, this means to be having a budget and making sure you are current on all of your debts. He then states you should save $1000 in a beginner emergency fund and then pay off all your debt (except the house) “paying minimum payments on everything but the smallest debt and attacking that one with a vengeance” until all the debts are gone. After you are debt free, he recommends you save 3 to 6 months of expenses for an emergency fund, and then start investing 15% of your income for retirement in pre-tax investments. After such he suggests you save for your children’s college funds and then pay off your home early or on tine. Finally, after all that is said and done, you are to build wealth and give a bunch of it away.
Ramsey is also a vocal opponent of payday lenders, pawn shops, rent-to-own, and other businesses with high interest rates that target the poor. Additionally, he frequently attacks debt collection agencies that use illegal tactics in violation of the Federal Fair Debt Collection Practices Act, and calls them “scum.” On Fridays, he invites his listeners to call in and scream “I’m Debt Free”, after they have paid off all their debts, and then Ramsey plays Mel Gibson’s “Freedom” scream in hopes that it will motivate listeners.
In addition to his radio show, Ramsey hosts about ten to fifteen live events each year, and has published a number of books, including some New York Times bestsellers. He has appeared on The Oprah Winfrey Show, The Early Show, 60 Minutes, The Today Show, CNN and the Neil Cavuto program. Ramsey also has a program called “Financial Peace University” which is a finance class taught in many churches and community settings.
