How to Get a Total Money Makeover Using Dave Ramsey’s Advice

Dave Ramsey is a successful author, radio show host and personal money management expert. According to his website, more than 450,000 families have attended Ramsey’s Financial Peace University classes. Not only have thousands attended the classes, but they’ve achieved results. Ramsey says the average family pays off $5,300 in debt and saves $2,700 in the first 91 days of the course and is completely out of debt, except for the mortgage, in 18 to 24 months. Here are a few of his tips to get you started.

Difficulty: Moderate

Instructions

Things You'll Need:

• Dedication
• Calculator

1. Save $1,000. This is the start of an emergency fund. Do whatever it takes to get the money together quickly.

2. Pay off all debt using Ramsey’s method of the Debt Snowball. This means that you will throw as much money as you can at your smallest debt until it is paid off. Then move onto your next smallest debt and so on until they are all paid off.

3. Put three to six months of your living expenses in savings. Make sure this money is easily accessible.

4. Invest 15% of your family’s income into Roth IRA’s and pre-tax retirement plans. Ramsey believes the earlier you start investing, the better off you will be.

5. Save for your children’s college education. The majority of students graduate college with debt, according to Ramsey.

6. Pay off your home as quickly as possible. Ramsey says your house payments should be no more than 25% of your take home pay.

7. Build wealth and give to others.

Tips & Warnings

• For more information read Dave Ramsey’s book “The Total Money Makeover.”

Resources

• Click here for more information on Dave Ramsey

[LAURA7088]

on 6/16/2008 Great tips!