Free Budgeting Tools Dave Ramsey
Dave Ramsey is an American talk show host, writer, and entrepreneur. He is also the founder of the “ilion”, a company that developed an electronic document management system. The company was sold to Precision Electronic Media Corporation (REMC). Ramsey currently hosts a show on Yahoo! Radio called “The Late Show.”
In this audio book, Ramsey shares seven baby steps to get you thinking about your ideas and turning them into reality. Some of the topics he covers are how to get your foot in the door, succeeding with small goals, finding the right niche, and ultimately building your brand. It is a nice complement to his other books such as “The New York Times Bestseller” and “Thinking”, each of which detail some of the same concepts. I enjoyed both books, but personally found Ramsey’s material to be a bit more detailed and rigorous. His style is sometimes a little more conversational than ponderous. Still, for aspiring entrepreneurs and business owners, this book is a great primer.
Dave also provides a number of practical exercises to aid in achieving the steps outlined in his book. One of these exercises is a snowball tactic to tackle debt-free living. It is a very practical exercise to undertake, and it definitely gets the ball rolling. You can snowball your way to getting out of debt.
Essentially, Dave’s debt snowball works in much the same way as the snowball tactic described in his other book. In both cases, you need to focus on paying off one debt at a time as opposed to concentrating on paying a large group of debts. In addition, in case you are worried that you might not be able to pay cash for your emergency fund, Dave suggests that you use the emergency fund to pay a little extra on your credit cards every month until you have built up enough emergency funds to cover the full amount of your minimum payments each month.
In contrast to the snowball tactic, Dave’s debt-free living method does require some discipline and hard work. You can’t just throw money at your debts and hope for the best. To get out of debt, you will have to focus on paying off smaller debts first, in order to build up enough emergency fund to pay cash for the larger debt obligations. It is also important to make sure that you don’t incur new debts while trying to pay off the old ones. Otherwise, you’ll only be increasing your debt instead of reducing it.
Dave also includes some recommendations for saving money for future goals. He encourages building a portfolio with both stocks and bonds and real estate, using the latter as a rental investment opportunity. He even suggests setting aside funds for retirement, although he notes that you may want to rethink this decision after you’re done working to eliminate debt. His seven baby steps to investing are sensible enough and make for good reading material on any number of valuable topics. The Ramseys don’t get into the best practices of investment strategies, but they are wise enough to understand that you shouldn’t put all of your eggs in one basket.
Part of the purpose of the seven baby steps to investing is to educate, but part of the purpose of the seven baby steps is to demonstrate that you’re willing to take action to fix your financial situation. Dave makes it clear that his goal isn’t simply to pay off the debt that he has accumulated, but to do so at a rate that leaves him with five monthly payments to his creditors instead of the three that he used to pay. He stresses that one of these payments is likely to go out in a short period of time, which means that he’ll need to be financially responsible and ready to act quickly. Again, this is advice that many of us could do without, but Dave is clear that he has been paying attention and he’ll continue to do so.
Overall, Dave Ramsey’s book is a great primer on how to develop an effective money plan. It’s full of practical advice and interesting case studies to help you think about your own finances in new ways. Although there are plenty of helpful hints and tips, the main message is that you really can’t expect to take control of your financial life just by putting aside some money each month. If you want to be rich, it takes more than just money to create wealth, and Dave Ramsey makes this very clear. For most of us, however, there are several reasons why we should put some of our extra income toward a savings or an emergency fund-and Dave Ramsay offers many ways for us to do just that!