Live
Like No One Else! (so
later, you can Live Like No One Else!!), or The Seven Baby Steps
Stolen by Gall (Dave Ramsey kinda makes
a living talking about this stuff)
In the spirit, promise and hope that the
official, astronomical start of summer (you do know that the summer
solstice is June 20th this year, don’t you?) gives us,
I’d like to take just a little bit of your time to share some advice
that we’ve received, and all of us around this place take pretty
seriously … and no, we’re not perfect and didn’t follow all of this
advice exactly the way that it is presented (and still don’t!!) …
however, we do, TRULY BELIEVE, that it is valuable advice to think
on pretty danged hard (and be sure and visit with your buppies about
it too.
(You can even
include your spouse if you’re so inclined
; ) ).
How To Take Control of Your Money (i.e. – Life) One Step at a Time
Building a
future with money is a lot like building a home.
You don't add the roof until
you've finished framing, and you don't frame until the foundation is
secure. Dave Ramsey's Baby
Steps[i]
are designed to help you get out of debt (and
the stress that accompanies that debt) and get you into a life of
saving and giving. Everyone
is in a different place with their finances, start wandering down
this list – find out where you are – and start right where you are
and you will get to where you want to be.
We all understand that
knowing how to do something is just 20% of what’s needed – and in
order to be successful with these steps will require the other 80%
in behavior change and self-discipline!
It CAN be accomplished – just follow the steps!
Here's The Seven Steps (note:
I didn’t necessarily say that they were easy!):
-
Get $1,000
Stashed Away For Your Emergency Fund:
Stop incurring debt (this
includes credit cards!) – get your emergency fund in place.
This fund is only for those unexpected events that come
along in life, you know … EMERGENCIES!
The emergency fund goes
into a separate account than your regular checking account and
should be a little more difficult to get to – since, after all,
it’s for emergencies. Learn
More From Dave
-
Create
a Budget and Snowball All Those Debts (don’t include the house
yet):
You NEED to have a household
budget and allocate every dollar to a particular purpose
(electric, water, food, clothes, etc.) – remember, we’re getting
out of debt so we want to cut as much as we can of the “extra”
(like: we can probably downgrade the cable – we don’t
necessarily NEED that many channels, do we?).
Then, we’ll list ALL of our debts (except the house) in
order from smallest to largest.
Make minimum payments on everything and throw all the
remaining money against the smallest.
Don’t pay any attention to interest rates or anything
else. Pay off that
smallest one! As
soon as you’ve killed it, throw all the remaining (plus the
extra that you have since the smallest one is gone) at the next
(now) smallest one, and so on, and so on … it’ll be like a
snowball – the money that you have to throw will get bigger and
the list will shrink faster as you head downhill!
Learn
More From Dave
-
Save Up 3-6 Months of Expenses:
After
you’ve paid off all those debts (again, except the house) –
build up a FULL emergency fund.
By now, you’re a budgeting star and you know how much
your monthly expenses are, so stash away 3-6 months’ worth for
protection against life's bigger surprises (like the loss of a
job). Now, there’s no
need to ever be in debt again—no matter what comes your way.
Learn
More From Dave
NOTE:
Can’t stop that snowball now (it’s too big and moving too
fast!) … steps 4, 5 and 6 can all be done at the same time!!!
Making TERRIFIC progress now!!
-
Put 15% of
Your Income Into Retirement:
Now
you’re ready to get really serious about retirement.
With no payments (except
the house) and your full emergency fund, you can now grow that
retirement account! You
have a lot of options between your 401(k), Roth IRA, Traditional
IRA, and mutual funds. The
money that you were once using to kill your debt can now help
build your future. Learn
More From Dave
-
College
Funding For The Kiddos:
If
you have kids – and if you plan on paying for some (or all) of
their college expenses – now is the time to save for that!
Two smart ways to save for your kids' college are a 529
college savings fund or an ESA (education savings account).
These are both
tax-advantaged savings vehicles that let you save money for your
kids' education expenses. (Dad
and mom-D will probably skip this step since us BC’s are already
MORE than smart enough!
Except Bubba, bless his heart, but we’ll continue to
“learn” on him!)
Learn More From Dave
-
Go Ahead and
Pay The House Off Early:
Since
you’re not paying credit card, student loan and car payments;
have your fully funded retirement fund; and are saving for
retirement and college for the kiddos – you’ve got plenty of
money left to attack that mortgage and kill it!!
Just imagine life with no mortgage.
Apply all the extra money
that you have now toward paying off your home.
Learn
More From Dave
-
Here’s The Best Part - Build Wealth and Be
Generous:
This
is the easy part and will take you the rest of your life (as
long as you remember the journey)!
You are DEBT FREE – that’s FREEDOM!!!
Now’s the time to Live Like No One Else, because you
Lived Like No One Else (especially that step 2 – it’s bound to
be a tough one … but the budget is the key!)
Yep, it's time to live
and give like no one
else! Go ahead and build
wealth, become insanely generous, and leave an inheritance for
future generations. You
know what people with no debt and no payments can do?
Anything they want!
Learn
More From Dave
Hey!
I (we) want everybody to be rich (if not famous!)
This is great advice – and we’re doing it here!!!
I don’t take ANY credit for any of this – it can be found
right there on Dave’s site … I “stoled it” straight from there (but
like Dave says – he gives the same advice that your Grandma did,
except “he keeps his teeth in!”)!
But I wanted to share this with all of you!
If anyone has any questions or concerns on these ideas and
practices … feel free to holler at dad – he thinks that he can
answer ALMOST as good as Dave can (and he has UMPTEEN BAZILLION
hours of podcasts that he listens to – often to mom-D’s chagrin
while they’re travelling!)
Peace Out (and Happy Summer!)!
Love,
Gall
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