New Here from Baton Rouge and scared of debt

4 Replies

Hey everyone, very excited to be here. I was referred to the podcast from a friend of mine about 2 weeks ago and probably listened to maybe 30+ episodes so far. Currently working a full time job and also own a small car dealership(about 15 cars). Over the last few years we have been avid Dave Ramsey fans. We will have our dealership paid for this year and our house paid off in 1.5 years(Lord willing). 

Since we are nearly terrified of debt, the real estate investing is very scary to us. I've read Rich Dad years ago and I understand the concept, but it's still terrifying. My boss(wife) is giving me permission to invest in one property at a time once we pay off our house, so that gives me about 1.5 years to get educated. 

Speaking of debt, if we are going to go forward and use it to invest, are there parameters that y'all use as rule of thumb?.......such as, should i never borrow more than my total net worth??...or not take a bigger monthly payment than i can afford with my personal income just in case the investment goes vacant for a long while or the economy goes sideways? 

Favorite episodes so far... 2, 10, 17***, and 302.

And my goals are not to be a mega millionaire, but to have financial freedom and freedom to move around the country and travel. 

Thanks for all the help, and keep up the good work Josh, David, and Brandon!!! 

38 years old, married, with 2 children.

The fear of debt is common and understandable. If your personal home is paid off though, then I think you should be able to invest in a single family home without that much worry if you've done your research. Were you planning to invest in something larger like a multifamily for your first investment?

I happen to be a big fan of DR, but the whole "debt is dumb" is just too extreme, IMO. I get that he lost a fortune and had a traumatic experience with debt and many others have too.  Water or fire can kill you if you are irresponsible with them, but nobody goes around calling swimming or owning a house with a fireplace dumb. 

I think if a person has the discipline to follow what DR teaches, they have the discipline to handle debt responsibly.  Whether or not to use debt or how much is a safe amount boils down to risk tolerance. We each have to make that decision for ourselves as adults.  Or with our spouse. ;-)

Successful investors use OPM to grow their portfolio. One of the keys to making it work is to buy right and make sure the property will pay for itself AND give you a monthly profit.

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