Deception of Ownership

Personal ownership of property (real and personal) is a long-held status symbol for most people. When people hear “status symbol”, they tend to think of flashy cars, designer clothing, or large homes.

However, even those who fancy themselves financially responsible own their home, vehicles, and other assets in their own name, looking with satisfaction at their modest lifestyles and “net worth.”

However, when people own their property they (1) set themselves up for disaster and (2) end up not paying themselves first.

Courting Disaster

When people own property in their own name, it can be taken from them quite easily. A lost job, a lawsuit stemming from a car accident, divorce, or any number of other risks can spring upon them at any time. Unexpected medical expenses from an accident, heart attack, cancer, or other untimely unwanted events can quickly leave one vulnerable to creditors.

Even those who have emergency funds, who can weather several months of no income can find themselves out of cash with courts ordering a house’s equity to be taken from them, equity that they’ve created by diligently paying down their mortgage with their hard-earned money.

Paying Other First

When people have earned income, others have claim to their money first. The most obvious are the various taxes taken out of a paycheck before it even hits direct deposit, but others are more subtle.

Control But Do Not Own

Courting disaster and paying others first when not necessary isn’t the best of strategies, given that alternatives exist. Rather than owning a house, a car, a load of paper, etc. it is recommended that one control these things without ownership.

For example, a properly constructed Illinois-style title-holding land trust allows one to not own a home, but still retain all the benefits of ownership. (I recommend people attend a NARS 2.5 day workshop to get a first-rate education in this area.) These are very different from the family living trusts designed to avoid probate, but which afford no legal protection.

Unfortunately, many probate lawyers give the false impression that these tools will offer protection despite endless case law in which these types of trusts are declared dry (meaning they’re invalid) when it comes to asset protection. As of this writing, experts in the field have not found a single case where a correctly constructed equity-holding trust has been declared dry. Use the traditional family trusts to avoid probate, but lock up your property in water-tight structures, such as what NARS educates people on. Put your beneficial interest in the home’s EHT in the family trust, not your home itself.

As far as paying yourself first, businesses are an excellent method to have access to pre-tax dollars, allowing one to spend before even the IRS gets a crack at the money. This must be done correctly and legitimately. Be sure to become educated on the ins and outs to avoid risk. (Remember, it’s you as the human that governs risk.)

Hopefully this will stimulate some thought. Most anything can be controlled without ownership. It takes some stretching of one’s paradigm to see how this can be possible, but it’s been the norm for money wise people for hundreds of years.

One Law or Many?

Context: I pulled this response out of a mailing list because the entire discussion is heading off topic.

Writing in this colour combination were my remarks. Writing in this colour combination were Allison’s remarks.

So, here we go…

Whether Ramsey’s advise is good or bad is situational. Of course, but isn’t this really true of ANY advice?

Let me step aside for a moment to lay down a few premises. Any particular bit of natural law has a realm in which it operates. This I believe we can agree on. I believe we can further agree that as other natural laws have more influence, the first natural law can appear to be violated, when in fact it has not.

As an example, hoist an airplane with a crane and release it. It will fall every time it’s dropped . Gravity dominates this scenario.

Now, instead of dropping the airplane, we fly it. This at first blush may appear to violate the law of gravity. However, gravity has not been violated. Gravity still has its previous influence, in fact. Nothing about gravity has changed. Instead of causing the airplane to fall, gravity is one of four complimentary laws acting in unison — gravity, lift, thrust, and drag.

If I may construct a twisted metaphor, Ramsey preaches gravity. He’s very good at showing people how to use gravity to benefit their lives. My point from the beginning is that there are additional complimentary laws that govern finances.

If his advice is generally sound, then it serves a large audience, which does seem to be the case.

This is something I have never disputed. It is like gravity. It’s real. It exists. It works.

Ramsey is for good for people who have no financial basics.

I still find him to be informative and solid.

You’ve just set up a straw man: the idea that Ramsey is not useful for people with no financial basics.

I never said that he wasn’t. On the contrary, I said (am getting tired of saying?) his ideas are foundational. Therefore let’s give another Hallelujah.

His advise is bad if you want to move beyond the hoarding mentality he advocates.

OK, enlighten me. As I said, I’m not terribly well-versed in his philosophy, but haven’t heard anything from him that remotely related to a “hoarding mentality.” Could you explain what you mean by that? And maybe what you mean by productivity, too?

It’s a few days later, and on reading what I wrote, I have to apologize for rushing past a fuller explanation. I was in a rush, but the fact remains that I’ve left some people confused or wanting more information. May I tackle this one bit at a time in other posts? I’m not willing to launch into a book right now, and will point to other great minds anyhow.

Again, if you don’t have the basics down, listen to Ramsey.

Sincerely, this a bit like ad hominem.

You’ll need to explain yourself here. How is this “a bit like” ad hominen?

An ad hominen logical fallacy is essentially where one impugns the messenger to imply that the message is flawed. It’s entirely possible that somewhere I have erred and made an attack on Dave Ramsey himself, rather than the idea that he is the One True God of finances. If I have, I’m grateful when it’s pointed out because it’s something that I didn’t realize or intend.

I was attempting something entirely different.

The entire purpose of my post was to stimulate thought. My purpose was not to repeat information readily had elsewhere. I thought to perhaps cast forth the idea that while Dave Ramsey’s message can be very useful, it’s not the “be-all and end-all”.

I’m starting to weary of saying this, but:

1. Dave Ramsey teaches ideas that will allow people to enter into a state far better than financial chaos.
2. He’s very good at what he does
3. If one’s personal goals match his goals, then one should listen to his advice religiously.
4. I also emphasized that if one is in financial chaos — what I called “not having financial basics” — it’s imperative to develop the skills he preaches.

This last point is very important, as it’s common for people without basic financial discipline to enter into business, real estate speculation, futures trading, or other “investments” and eventually find their financial house sinking on the quicksand foundation.

That kind of thing might make one wonder what your financial credentials are

Here I’m very — let me emphasize very — disappointed because this is an unvarnished ad hominen argument. This is quite unlike Allison, and I can let it pass.

I’m not entirely sure what she was driving at. I can see a couple of things, and one is flawed. I think it’s worth addressing because it’s a foundational idea. Foundational ideas are dear to me.

How does one go about discerning truth? This is a huge topic, but let me address an aspect or two.

Ponder this question: Can one ascertain the degree of truth in a message by examining the messenger?

Let me give some examples to think about:

Example #1:

A druggie says, “Drugs are harmful.”
A person who has never so much as taken more aspirin than directed says, “Drugs are harmful.”
A physician says, “Drugs are harmful.”

In whom is the pudding proof? The druggie has experience traveling through that hell. One might tend to give his message more credibility because of that. However, does that — or should that — be a factor in exploring the idea? The “I never have taken three aspirins at once in my life” person could also be considered more credible since that person has lead a clean and sober life. And what of our dear doctor? This person has a degree in medicine.

Example #2:

A druggie says, “Drugs are no big deal.”
A person who has never so much as taken more aspirin than directed says, “Drugs are no big deal.”
A physician says, “Drugs are no big deal.”

In whom is the pudding proof? The druggie has experience, and knows the road well. One might tend to give his message more credibility because of that. However, does that — or should that — be a factor in exploring the idea? What of the sober person, who could also be considered more credible since that person is more objective, not being under the influence of drugs? What of the physician? This person has studied medicine thoroughly and is an expert on the subject.

If one attempts to judge the validity of an idea not by the idea, but by the messenger, these kinds of dilemmas appear. That can make discerning the truth of the matter difficult.

It’s also a very human tendency to put more faith and credit in a person’s words than are due. Logical fallacies are easy to fall into because we’re all human.

Here’s a common one: the “appeal to authority”, which says this:

1. Person A is an authority on the subject.
2. Person A say X is true.
3. Therefore X is true.

We humans do it all the time, don’t we? When it’s pointed out plainly, we also can get defensive and shout, “Well, I don’t do that!” Rest assured, we all do that more than we care to admit to ourselves.

this is an arena where the proof is in the pudding

This is a slippery fish.

Unfortunately it appears that there is a challenge. If I cannot “prove” I am by some (undefined) measure “better” than Dave Ramsey (or at least his equal), then I should remain silent, or people should at least ignore me as a hubristic loudmouth.

If we’re going to get into a pissing match over who has a bigger ___________ (bank account, paper portfolio, fill in the blank), then I can only chuckle. “My” information is not mine, it’s freely available to everybody, older than man, and well substantiated. I’d gladly pit the ___________ (fill in the blank) of financial giants against Dave Ramsey. He’s quite successful in his own right — don’t misunderstand me here — but as far as I have been able to tell, he’s hardly the big fish in the pond.

But what would be the point? If I haven’t made abundantly clear by now that Ramsey’s information is largely useful, what more can I say? I only invite people to consider the notion that he’s not the fount of all truth financial. Some people do. This is why I jokingly referred to him as “the Great Prophet Ramsey”, which points to some people’s notions, not Ramsey himself.

As I mentioned before, I can start pointing people to other information if they can’t find it, or it’s so unfamiliar.

Personal paradigm — the way we look at the world — is a powerful information filtering mechanism. We tend to see that which matches our paradigm. We tend to reject ideas that are not consistent with our paradigm. If an idea matches our internal measuring stick, we tend to label it “true”. If an idea does not match our internal measuring stick, we tend to label it “false”.