Budgeting – Dave Ramsey Money Makeover
The Power of a Budget and Baby Steps to Beat Debt and Build Wealth
I’m sure you have heard of Dave Ramsey; often referred to as today’s financial guru.
His path to wealth is based on seven, simple, common sense baby steps.
However, before taking the first step, he teaches the importance of a written monthly budget.
Ramsey’s book “The Total Money Makeover”made the NY Times Best Seller list. He also teaches these principles in other books and courses. Plus you’ll find him on the radio, TV, at live events and his website is www.daveramsey.com.
Dave Ramsey’s recommended baby steps are below:
1 – $1,000 to Start an Emergency Fund
We all know it is only a matter of time before the unexpected emergency happens. This is for the unexpected things we can’t plan for.
2 – Pay Off All Debt Using the Debt Snowball
List all of your debts and begin paying them off starting with the one with the smallest balance. Once the first one is paid begin using the “extra money” toward paying the next on the list, etc.
3 – 3 to 6 Months of Expenses in Savings
After the first two steps are completed it is time to start building your full emergency fund.
4 – Invest 15% of Household Income Into Roth IRAs and Pre-Tax Retirement
When you reach this step, you’ll have no payments except your house. Now it is time to get serious about building wealth.
5 – College Funding for Children
Make sure you have already started investing 15% of your income in step 4 before saving for college.
6 – Pay Off Home Early
Now is the time to begin putting all extra money toward the mortgage to realize the dream of life without a house payment.
7 – Build Wealth and Give!
Time to build wealth and give like never before. Leave an inheritance for future generations and bless others with your excess.
video clip of Dave Ramsey:
Our society today is lacking in financial common sense and discipline. Everyone wants to have things “now” but figure out how to “pay” later.
There is hope though, and there is help for anyone who wants it. I’m always very encouraged to hear the success stories of those who have gone through the Dave Ramsey course.
If your finances are a mess, it is not too late to reach out for help, make a plan, and begin taking the first step to turn things around! 🙂
May you be blessed to be a blessing!
God bless you always,