Dave Ramsey knows how to capture your attention.
Normally he uses that skill in the service of doling out financial advice to the more than 7.7 million people who tune in to his radio show every week, which makes him the third-most-popular radio personality in the country, behind Rush Limbaugh and Sean Hannity and ahead of Glenn Beck. Or to the thousands more who throng to his live events, like his planned appearance at a 3,000-seat arena in New Jersey in November. Or the readers of his four bestselling books, or participants in his Financial Peace University, a nine-week video course offered at local sites around the country, often churches.
In June, however, Ramsey took to Twitter and engaged a very different audience: financial advisers.
"I help more people in 10 min. than all of you combined in your ENTIRE lives," Ramsey tweeted at a group of advisers in response to a discussion they had kicked off about him. For good measure, he ended his tweet with the hashtag #stophating. Strong words, but so were those of the advisers.
Carolyn McClanahan, a financial planner from Jacksonville, had said she "despised" Ramsey's investing advice. Carl Richards, a planner who frequently contributes to the New York Times, called it "crap." James Osborne, who practices in the Denver area, said it "would be malpractice if he was a real professional."
Ramsey's tweet sparked more debate online, in barbed blog posts from other advisers and investment writers. Which goes to show that Ramsey is one of the most compelling figures in the world of financial advice, as well as a polarizing one.
When MONEY readers were asked in a recent survey whom they would most want to read more about, Ramsey ranked near the top. It makes sense: He's an eloquent, relentless preacher for habits any reader of this magazine would embrace, like saving a lot, staying out of debt, and planning for the long run.
Yet he gives investment advice that drives many financial advisers crazy, and with some cause. In Ramseyland, you can let everything ride on equities, and the bull market of the 1980s and '90s goes on forever.
Ramsey's scrap with advisers is also over who are best qualified to give investment advice -- and how they should be paid. The radio star has aligned himself, and part of his business, with brokers who earn commissions selling mutual funds with front-end sales charges. Many of Ramsey's critics are financial planners who are paid on a fee basis, no matter what their (mostly well-heeled) clients buy. Such critics have been trying to pick apart his ideas for years, but Ramsey has grown only more popular.
The culture warrior of personal finance
This is quite a turn for a man from Tennessee who likes to call himself "a complete failure." Ramsey's origin story of collapse and rebuilding, told again and again on his radio show and at live events, has become the cornerstone of his popular appeal.
By the time Ramsey was 26, he has written, he had become a real estate millionaire, but the leverage inherent in the business caught up with him. Ultimately, Ramsey has said, he had to declare bankruptcy.
Ramsey, who declined to be interviewed for this story, attaches a simple lesson to this: Debt is corrosive, almost to the point of being a moral failure. "The borrower is slave to the lender," Ramsey says, invoking Proverbs.
Ramsey is overtly religious, and his for-profit Financial Peace University is billed as "a biblically based curriculum that teaches people how to handle money God's ways."
Ramsey, 53, got his start in radio with a show in Nashville in 1992. By the time he came to the attention of the coastal elites in the mid-2000s, his show was already a national force, with 2 million listeners. Ramsey tells people that no matter the state of their financial lives, there is hope for recovery if they will just take responsibility and start to take action.
"He is talking about the basics of morality and character," says Michael Harrison, the publisher of Talkers, a radio-industry trade magazine, and someone who has followed Ramsey for years. "His core message is of culture: We are a society that is drowning in debt. Major institutions are in debt. The radio stations that carry his show are in debt. The government that provides the airwaves for the radio show is in debt. People are stressed because people live in a very tempting culture."
Ramsey's credibility is a valuable commodity. Zander Insurance Group, a Nashville-based company that sells term life insurance, has Ramsey's face and warm endorsement plastered all over its website. Co-owner Julian Zander, who calls Ramsey "my buddy, my mentor," attributes all of his company's out-of-state life insurance sales, the majority of their life business, to Ramsey.
Ramsey also lends his name to a mortgage company, a business that buys gold, and family web-filtering software. He's extended his brand to the grass-roots level too: Go to Ramsey's website, type in your contact information, and his company, Lampo Group, will put you in touch with an "endorsed local provider" (ELP) who can give you investment advice that is supposed to be consistent with Ramsey's philosophy.
What's notable about the war of words between Ramsey and the financial planners is that they are largely talking past one another. Top financial advisers counsel the affluent about the fine points of how to invest their money, maybe along with estate planning and sanding down tax bills. Ramsey focuses his advice mainly on people struggling to get out of costly consumer debt. His bestselling book The Total Money Makeover has about two pages describing which mutual fund to invest in. There's an entire chapter on how to save $1,000.
In fact, the very first thing that Ramsey says in "Dave's Investment Philosophy," at daveramsey.com, is that you may not be ready to invest yet.
First you have to follow "Baby Step 1" and save that $1,000. Step two is to pay off all your debts besides your mortgage, and st