![]() Save 3–6 months of expenses in a fully funded emergency fundĪfter you’ve paid off your debt, he recommends that you take that money you were throwing at your debt and invest it in your emergency fund. It’s up to you what method you choose to pay off your debt, the key is to get rid of it.ģ. You pay the smallest balance first, and when you’re done paying off that debt, you add the money you were paying to the minimum you’re paying for the next debt. It’s when you list all of your debts except for your mortgage and put them in order from smallest to largest and pay it off one by one. He recommends using The Debt Snowball Method. In his second step, he recommends paying off your credit cards, student loans, and cars. Pay off all debt (except the house) using The Debt Snowball Your goal is to become debt-free, not the other way around.Ģ. This emergency fund will cover those unexpected expenses and help you not fall into bigger debt. So in his first step, he recommends that you save $1000 as fast as you can. One of the main keys to getting financial freedom is to be prepared for unexpected emergencies you cannot plan for. It’s a system where Dave Ramsey gives 7 “baby steps” to take in order to save for emergencies, pay off all your debt, and build wealth. One of his most well-known systems is known as “Dave Ramsey’s Baby Steps”. There he shares what he’d learned after fighting back from bankruptcy, inspiring and providing counseling to help people achieve financial freedom. He started Ramsey Solutions in 1992 that turned into a multi-million dollar firm. He is also a national radio personality with 16 million weekly listeners and an author of bestselling books such as The Total Money Makeover, Financial Peace, Complete Guide To Money and others. Dave Ramsey is a financial expert and America’s trusted voice on money and business. ![]()
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