The Calculation for Madison, Wisconsin  (Dave Ramsey Misery Index)

Madison, Wisconsin is a great place to live for the healthy minded. MadisonMadison WI ranked #3 on Livability magazine’s list of top ten  healthiest cities to live in. The weather might have something to do with that. Madison, Wisconsin is a great place to bike and enjoy outdoor sports. The summers are mild, winters cold which allows for a variety of sports all times of the year. Madison ranked #1 on both USA Today and NCAA as the top college football towns in America. It is the location of the University of Wisconsin Madison, a great football school. National Geographic placed Madison in the top ten happiest cities list. So if you want great football, great biking, great weather (especially summer) and healthy lifestyle opportunities, check out living in Madison, Wisconsin.

The Dave Ramsey Misery Index consists of two numbers made out in the form of money lost due to Dave Ramsey’s advice related to home purchases. (All numbers are based on an after tax calculation) They are as follows:

  1.  Home Price Appreciation (Calculated based on actual data per market) I calculated the actual price difference between the median home sale price in October 2011 (when I read Dave’s advice about home buying) and the median home sale price for May of 2015. This area is represented by Madison, Wisconsin. The median home sale price increased 13% for that time period. Using the example of a $197,325 home in that market as of October 2011, the same home would cost $25,475 more or $222,800 as of May 2015. (Information gathered from Zillow Real Estate Research )
  2.  Higher Mortgage Payment. The second number is the difference between what the mortgage payment would have been in 2011 and what the mortgage payment is now, calculated over the life of the loan secured in 2015.

Expressed in numbers the Dave Ramsey Misery Index for Madison, Wisconsin would be as follows:

  • Home Price Appreciation                                                                $25,475
  • Increased mortgage payment next 360 months                      $42,402 

             TOTAL MISERY        $67,877

Each time I post a new misery index it will be for a particular community showing the misery Dave Ramsey has caused his followers

DRMIregarding his advice to wait to purchase a home. Back in 2011 I was screaming at the top of my blog posts and videos that it was time to buy a home, an investment property or a primary residence. With interest rates as low as they were and home prices at unbelievable prices it was almost impossible not to see the writing on the wall as to what was going to happen. It has happened. Going forward it appears to me that we are faced with a high probability of increased inflation. With that being said, it is still a good time to buy while interest rates are low and before prices go higher! And, please don’t listen to Dave Ramsey when it comes to buying a home. His advice has created a lot of misery for folks.

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