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The Wisdom of Consolidation Loans - What do you think?

Tammi and I have been avid fans of Dave Ramsey and Ramsey Solutions for over 30 years. We were married at age 20 and found ourselves in a challenging financial situation. Fortunately, we discovered Dave Ramsey, in fact, on a clearance rack cassette tape in an Indianapolis bookstore. We listened to his advice and were captivated; it changed our lives forever. This journey transformed our finances, our marriage, and redirected my career.

 

Today, I work as a Financial Advisor at Whitaker-Myers Wealth Managers and hold the additional designation of Certified Ramsey Solutions Master Financial Coach. Over the years, I have had the privilege of helping hundreds of clients with money management and financial planning.

 

Debt Consolidation Loans

A couple recently asked for money management assistance and referenced that their core plan is to tackle their debt with a consolidation loan.  What do you think? 

 

Their ages are in their late 40s and early 50s.  They clearly have been spending everything they make and more.  They have over 20 consumer loans, including bank cards, store credit, and many personal loans.  These debt balances range from $1700 to $66,000.  Their minimum monthly payment is just over $10,000/month. 

 

Is debt consolidation a good idea?  After all, they could consolidate debt, reduce the burden of 20+ open accounts, have lower monthly payments, and feel better and more in control. 

 

Hard Pass

Debt consolidation is not a good idea in this situation, and it is not likely to be a good idea in your situation either.  Why?  Money management is ultimately about financial behavior.  Dave Ramsey and his team at Ramsey Solutions tackle these issues using the “debt snowball.”  You list your debts from smallest to largest and attack the little one with “gazelle intensity.”  This means you build a purposeful budget, live on less than you make, and pay off your smallest debt as if your life depends on it.  You do this repeatedly with the next smallest debt. 

 

My wife and I can attest that this strategy absolutely works.  It requires fierce determination and strong teamwork, but it works while building a stronger marital relationship. 

 

It is not advisable to consolidate debt.  Why?  Because it feels like you have done something when, in fact, you have not really done anything.  You probably actually made matters worse.  Why?  Because you have not changed anything.  I have had many clients who consolidate debt, make no behavioral changes, and ultimately continue borrowing, with the debt issue worsening.   

 

Financial Planning and Money Management 

I have had the privilege of serving hundreds of clients over the years.  I absolutely love helping our Ramsey clients and others to change their lives and to build God’s Kingdom.  There is no better career calling.  Some clients are fully committed to making these real changes.  Are you tackling baby steps 1, 2, and 3, or have you journeyed to baby steps 4, 5, and 6? 

 

Our financial advisors and coaches can help you wherever you are on your financial journey.  It just takes your determination and a relentless commitment. It is not easy, but it is truly worth it.  And we are here and happy to help.

 

Would You Like to Learn More about Financial Planning?

My primary objective as a Financial Advisor is to help clients plan and manage their finances to create financial peace. If you’d like to explore more, please use my calendar link to schedule an introductory planning session.

 

Whitaker-Myers Wealth Managers is an SEC-registered investment adviser firm. The information presented is for educational purposes only and intended for a broad audience. The information does not intend to make an offer or solicitation to sell or purchase any specific securities, investments, or investment strategies. Investments involve risk and are not guaranteed. Whitaker-Myers Wealth Managers reasonably believes that this marketing does not include any false or misleading statements or omissions of facts regarding services, investment, or client experience. Whitaker-Myers Wealth Managers has a reasonable belief that the content will not cause an untrue or misleading implication regarding the adviser’s services, investments, or client experiences. Please refer to the firm’s ADV Part 2A for material risks disclosures.

​

Past performance of specific investment advice should not be relied upon without knowledge of certain circumstances of market events, the nature and timing of the investments, and relevant constraints of the investment. Whitaker-Myers Wealth Managers has presented information in a fair and balanced manner.

​

Copyright (c) 2023 Clearnomics, Inc. and Whitaker-Myers Wealth Managers, LTD. All rights reserved. The information contained herein has been obtained from sources believed to be reliable, but is not necessarily complete and its accuracy cannot be guaranteed. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness, or correctness of the information and opinions contained herein. The views and the other information provided are subject to change without notice. All reports posted on or via www.clearnomics.com or any affiliated websites, applications, or services are issued without regard to the specific investment objectives, financial situation, or particular needs of any specific recipient and are not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Past performance is not necessarily a guide to future results. Company fundamentals and earnings may be mentioned occasionally, but should not be construed as a recommendation to buy, sell, or hold the company's stock. Predictions, forecasts, and estimates for any and all markets should not be construed as recommendations to buy, sell, or hold any security--including mutual funds, futures contracts, and exchange traded funds, or any similar instruments. The text, images, and other materials contained or displayed in this report are proprietary to Clearnomics, Inc. and constitute valuable intellectual property. All unauthorized reproduction or other use of material from Clearnomics, Inc. shall be deemed willful infringement(s) of this copyright and other proprietary and intellectual property rights, including but not limited to, rights of privacy. Clearnomics, Inc. expressly reserves all rights in connection with its intellectual property, including without limitation the right to block the transfer of its products and services and/or to track usage thereof, through electronic tracking technology, and all other lawful means, now known or hereafter devised. Clearnomics, Inc. reserves the right, without further notice, to pursue to the fullest extent allowed by the law any and all criminal and civil remedies for the violation of its rights.

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Whitaker-Myers Wealth Managers is an SEC-registered investment adviser firm. The information presented is for educational purposes only and intended for a broad audience. The information does not intend to make an offer or solicitation to sell or purchase any specific securities, investments, or investment strategies. Investments involve risk and are not guaranteed. Whitaker-Myers Wealth Managers reasonably believes that this marketing does not include any false or misleading statements or omissions of facts regarding services, investment, or client experience. Whitaker-Myers Wealth Managers has a reasonable belief that the content will not cause an untrue or misleading implication regarding the adviser’s services, investments, or client experiences. Please refer to the firm’s ADV Part 2A for material risks disclosures.

​

Past performance of specific investment advice should not be relied upon without knowledge of certain circumstances of market events, the nature and timing of the investments, and relevant constraints of the investment. Whitaker-Myers Wealth Managers has presented information in a fair and balanced manner.

​

Copyright (c) 2023 Clearnomics, Inc. and Whitaker-Myers Wealth Managers, LTD. All rights reserved. The information contained herein has been obtained from sources believed to be reliable, but is not necessarily complete and its accuracy cannot be guaranteed. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness, or correctness of the information and opinions contained herein. The views and the other information provided are subject to change without notice. All reports posted on or via www.clearnomics.com or any affiliated websites, applications, or services are issued without regard to the specific investment objectives, financial situation, or particular needs of any specific recipient and are not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Past performance is not necessarily a guide to future results. Company fundamentals and earnings may be mentioned occasionally, but should not be construed as a recommendation to buy, sell, or hold the company's stock. Predictions, forecasts, and estimates for any and all markets should not be construed as recommendations to buy, sell, or hold any security--including mutual funds, futures contracts, and exchange traded funds, or any similar instruments. The text, images, and other materials contained or displayed in this report are proprietary to Clearnomics, Inc. and constitute valuable intellectual property. All unauthorized reproduction or other use of material from Clearnomics, Inc. shall be deemed willful infringement(s) of this copyright and other proprietary and intellectual property rights, including but not limited to, rights of privacy. Clearnomics, Inc. expressly reserves all rights in connection with its intellectual property, including without limitation the right to block the transfer of its products and services and/or to track usage thereof, through electronic tracking technology, and all other lawful means, now known or hereafter devised. Clearnomics, Inc. reserves the right, without further notice, to pursue to the fullest extent allowed by the law any and all criminal and civil remedies for the violation of its rights.

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