Dave Ramsey's 7 Baby Steps: Your Help to Financial Freedom
Are you struggling with debt? Do you feel like you're never going to get ahead financially? If so, you're not alone. Millions of people are in the same boat. But there is hope. Dave Ramsey's 7 Baby Steps can help you get out of debt and build a strong financial foundation.
The 7 Baby Steps are a simple, yet effective plan for getting your finances in order.
They are:
1.Save $1,000 for your emergency fund. Save $1,000 in case you have a small emergency. Ramsey followers work extremely hard during steps 1-4. Having an emergency fund will help you cover unexpected expenses, so you don't have to
go into debt.
2. Pay off all debt except your home using the debt snowball method. This means paying off your debts from smallest to largest, regardless of interest rate. Once you've paid off one debt, roll that payment into the next debt, and so on.
3. Build your emergency fund up to 3 to 6 months of expenses. This will give you even more peace of mind knowing that you're prepared for anything. It is recommended to have 3-6 months of your bare minimum expenses in case you lose a job, have a large unexpected bill, etc. Having the emergency fund means this is now an inconvenience and not a financial emergency.
4. Invest 15% of your income for retirement. This is a long-term goal, but it's important to start saving early. The sooner you start, the more time your money has to grow.
5. Pay off your home mortgage. This is a big one, but it will be worth it in the end. Having no mortgage payment will free up a lot of money each month, which you can use to do other things, like save for retirement, travel, eating out, other fun activites.
6. Build wealth and give. Once you've taken care of your financial obligations, you can start building wealth and giving back to others. This could include investing in real estate, starting a business, or donating to charity.
7. Retire comfortably. By following the first six steps, you'll be well on your way to retirement. You'll have no debt, a healthy emergency fund, and a nest egg for retirement.
The 7 Baby Steps are not a get-rich-quick scheme. They are a proven plan for getting
out of debt and building wealth. If you're serious about getting your finances in order, I
encourage you to check out Dave Ramsey's website and resources.
Here are some additional tips for following the 7 Baby Steps:
• Get organized. The first step to getting out of debt is to get organized. This
means tracking your income and expenses so you can see where your money is
going.
• Make a budget. Once you know where your money is going, you can create a
budget to help you stay on track.
• Make changes. Following the 7 Baby Steps will require you to make some
changes to your lifestyle. This may mean cutting back on expenses or finding
ways to make extra money.
• Don't give up. The 7 Baby Steps are not easy, but they are worth it. If you stick
with it, you will eventually reach your financial goals.
Disclosure:
Dave Ramsey is not affiliated with Custer Financial Advisors or LPL Financial.