Recently, a guy from Motley Fool, Brian Stoffel, wrote a blog post on Dave Ramsey’s advice for retirement savings. Essentially, Stoffel tried to poke holes in one of the assumptions in Ramsey’s model. That of an assumed 12% average return on their investments. Stoffel tries to point out some differences in the how that number was derived and how the amount should actually be closer to 9%.
Ramsey did invite Stoffel on his program to discuss the differences (listen here). It should surprise no one that I’m a fan of Ramsey’s but I did feel a little like Dave was using his radio program as a Bully Pulpit. Ramsey did come across a little strong, but if you’ve listened to his show, that’s what he is. Opinionated, yes. But he can also back up his talk with thousands, if not millions, of people being helped by his tactics (including yours truly).
Stoffel was clearly trying to make a name for himself and came to the game quite unprepared. He hadn’t read any of Ramsey’s books, nor watched his DVD programs or attended any of his live events. Instead basing his story on a tweet that Ramsey published a few weeks ago. Bad move.
You might then say “But, aren’t you trying to make a name for yourself with this post?” Not really. While I’d love to have a little more publicity for this site, I’m looking to help my loyal reader(s) get another aspect of what smart retirement savings is all about.
Stoffel writes about how the difference between Ramsey’s #’s and his could cost ‘a hapless investor’ $770,000.
My response to this is you’re not paying attention to your investments for 30 years, you deserve to lose money. I mean really? This is the crux of Stoffel’s argument? Some poor schlep who didn’t pay attention is going to lose money? If this person really was paying attention and saw his investments not getting the expected returns, he’d make an adjustment.
So, make the budget, create the retirement plan and PAY ATTENTION!