Dave Ramsey - thoughts?

unicornrose2804

I have just finished Dave Ramsey total money make over book and i am totally on board with his baby steps plan. I know he focuses more on the mental side of paying off debt rather than the mathematically side. I was just wondering your thoughts about him and his plan! has anyone had any success with it or failed doing it? would be interesting to know of true life stories.

Fireflyaway

I watch his show most days on youtube. I think he speaks a lot of sense. Particularly regarding not using credit and trying to avoid car payments. I also like that he speaks the truth. He will tell people straight they should be trying to increase their income or work harder. I do think a lot of us rely too heavily on credit and don't have a good enough work ethic. I also like that he encourages giving.
I've adopted the emergency fund principle and now use cash far more than cards. I believe it really does make you spend less. I've cut up my credit cards and don't intend to borrow again ( except a mortgage). I used to check my credit score and feel smug if it was up. I haven't checked it for probably a year. Now I think paying off debt and having savings is more important. I also do a written budget. In addition I now allocate a weekly spending limit. I withdraw my pocket money each month and divide into 4 plastic envelopes. That way money for bills and money for fun can't get muddled. That's probably the most useful habit ive adopted.
If you haven't yet I'd recommend watching the debt free screams.

unicornrose2804

i have been watching youtubers for years go on about the plan but ive never really read about it or practised it myself! im going to watch some videos and start planning! i know its all american based but debt is debt no matter what currency!

Chandelier.

A plan is always a good place to start! Get a accurate SOA done and go from there. People have different ways of tackling debt, its what works for you psychologically that matters. Also building an emergency fund is a good idea!

unicornrose2804

im going to work on the plan! we already have baby step 1 done £1000 in the bank!
plan for baby step 2 is to pay down smallest balance to largest regardless of the interest!

we have already paid the overage in our savings account towards the debt! really good plan! been watching his show on youtube for the past few hours!

we dont have much debt but i like the idea of paying it off then getting 6 months of expenses saved!

i also dont believe in posting an soa publicly. i dont like the idea of people nosing at my income and expenditure!

sourcrates

unicornrose2804 wrote: »

i also dont believe in posting an soa publicly. i dont like the idea of people nosing at my income and expenditure!

No one knows who you are, its completely anonymous, sometimes it helps to see the figures in black and white, also solutions to your debt problems cannot be suggested without knowing what your income is, and what your spending.

DMP
DRO
IVA
BANKRUPTCY

These are the debt solutions available in the UK today, all are SOA dependent, as to weather they are a suitable choice or not, that`s the only reason we ask.

enthusiasticsaver

I have watched a couple of his podcasts and yes he talks sense but because he is based in the US not all the advice is relevant. He is popular on here but I am sceptical that buying his £20 books is good common sense unless you really have no clue about how to be financially stable.

The babysteps is just basic financial common sense which we have followed our whole life. Don't take on debt, invest for the future and retirement and to get your kids through university, pay off your mortgage asap and first and most important build up emergency savings. Work for yourself, not to service the credit card debts, car loans, personal loans. Budget and live within your income.

doingitanyway

I like Dave Ramsey's principles. The basics are the same wherever you US or UK based. There are plenty of online resources so no need to buy the book or sign up for courses. Some of his views jar with me but his baby steps make sense to me.

BookmobileBadGirl

I have some issues with Dave Ramsey the person (always carries a gun being a big one) but the principles he teaches are sensible ones (aside from the paying for kids college, and his belief that choice of college has no impact on job prospect)

No need to buy the books, just listen to his podcast or watch youtube

firebubble

I think his philosophy is good. The only bit of his advice I don't agree with is to stop saving for retirement whilst you are paying off debt by stopping pension contributions, including those with an employer match, so I would modify that to say only drop pension contributions to the minimum to get the match only whilst you are paying off debt, and only if the debt repayment stage will be a year or two, and only if you are under 50 - otherwise keep your pension contributions at the same level and work around it.

getmore4less

Probably the most important thing you can do is know where your money is going.

This applies to everyone, you cannot make a realistic plan if you don't know where it all goes

The plan is all about where you want it to go.

You can only spend each £1 once.
Borrowing from your future self.
Saving for your future self.

In life you need to earn enough to live for say 60 years(20-80)

If you borrow money that's a future year you will still have to earn it.
If you save money that's a future year you may not need to earn it

Work on a plan to retire early or work till you drop