CommentaryGold wow that’s nice. I wish you could talk to my 28 y.o son who hasn’t gotten it yet. While he’s financially independent ( doesn’t ask me for any money and lives on his own) , but he still spends like crazy, has the credit cards etc. He just brought a brand new Nissan Maxima ( I assume about $30,000) , and I don’t think he’s saving for his future. I just hope he wakes up before it’s to late. What gave you the mindset to do the things you have done with your money? Congratulations keep up the good work. One day you’ll be one of the everyday millionaires that Dave always talks about.
@@pacluv I had $10,000 at 25 years old and that was after I put another $10,000 into a retirement fund. What got me in the mindset is that my parents were never shy about talking about money and issues we were having. I know many therapists would say not to do that with kids. Of course, parents need to use good judgement when discussing the adult world with their children, as to never make it sound like it's the child's fault, but it shouldn't be a secret either. But at the end of the day, it is on the child to see past the now. Many money problems happen because people look at emergencies like it's "a might happen" instead of a "will happen, just a matter of when and how" as emergencies should be looked at.
I have $26k in my emergency fund and I’ve been debt-free for over two years. Phone was damaged/stolen? I can get a new one on the spot. Need new tires $800+? Done. I can handle practically most emergencies.
Good for you. I am kinda there I have 8k in emergency funds with 4.5k debt left. Id pay it off but my job is not stable. By Nov I will be debt free. I will then bumb up my 4 mons savings to 6. Start contributing and Max the roth ira I justed opened before April 15 2019. Throw my e fund in a no penalty CD making 2.10% max out Roth again then bump my fund from 6 to 9 mons. By that time ill be in a job that offers a 401k which I will max.
Mike, we have a vehicle maintenance/repair fund. I encourage people to have one. Certain items are just regular maintenance items that aren't emergencies at all. We cap ours at about $3k. Things like oil changes, brakes, tires, registration, flushes, etc are regular maintenance. Flat tire from a nail, if not covered by the maintenance/repair fund can go on emergency if the fund is depleted.
I was thinking about having a sinking fund for a new vehicle and repairs in addition to my e fund but I am not sure. My car currently has 149k miles. I know something is going to happen soon. Like maybe 2.5-3k for vehicle repairs sitting in another account. I don't want to touch my e fund for a car repair. I look at the worse case scenario. I lose my job and my car on the same day or week. What do you think?
Yeah, nice job. I was so stupid when I was 21. You have more than me and I am nearing 30. Don't be like your "friends" and don't let your friends know you have 12.5k they will envy you and look at you differently because you are not like them. I let it slip one day at work that if we had to go on strike. I will be good for four months and we should do it if they mess up our pay again. I noticed everyone didn't like the comment because they are not in the position I am in.
I'm 22 and in the same boat. Great job! I just can't believe all of the people our age hasn't found Dave, or don't agree with his advice. I've had people laugh at me in college because I would watch Dave Ramsey videos before class started to pass time.
I have a years salary emergency fund saved up, and I've been debt free since around 2011, both personally and my two businesses. I cannot describe the feeling entirely, but it's like you finally sat down after standing your whole life. It changes your entire perspective about everything once you can afford "anything". I believe being debt free is how GOD wishes us to live. It's not just financial peace, it's peace itself..
Me too, Bucky! I didn’t want to have to touch my emergency fund while I was in Baby Step 2 because I didn’t want to have to stop paying off debt to rebuild that $1000! 😡 Had to use the fund 2 years in a row for major car repairs. First year, I had less than $800 before I needed to use it. Second year, a different repair took the whole $1000 plus $200 my sister helped me with. Paid her back the following month. I’m paying the last payment on my smallest debt at the end of this month! I’m afraid I may not get too far into Baby Step 3 before my 17 year old car goes to that big salvage yard in the sky. Without the debt, it’ll be easier to face rebuilding the emergency fund, especially with a more reliable car!
Dave has completely put an end to my 30yr streak of going into debt to buy cars. Haven’t had a car payment in two years and will never have one again. Thanks Dave!
Six years ago I lost my first wife. (Only child died before her) The peace that I felt while sitting by her bedside. Not worrying about how to pay the bills. Thank you, for that gift!!! Dave and team As for living like no one else. I am remarried. My step daughter loves wwe. We were at survivor series in Houston last November. Third row from the ring.
Couldn’t agree more. Just had to replace our roof, a job that costed us $6,400. Having our emergency fund helped us not have to take out a loan. Emergencies WILL happen. Definitely a must have!
I’m 26 and on baby step 3 with $2000 in my emergency fund. Goal is $6000. Meanwhile I’m also saving for vacation and other expenses that will come my way (Birthdays, Christmas, Car Insurance, etc ) I can honestly say Dave Ramsey changed my financial life.
My wife and I have completed baby step 3. We have an emergency fund of $12000. Literally anything that comes up, we can cover. We live in FL so if the A/C goes out (its only 4 yrs old) we can pay for a new one! Our friends freak out over every expense that comes up, and it feels so good to not even bat an eye at an expense. They are always fighting with their wives about money, one of them even just got divorced. They made about 120k a year combined, but were COMPLETELY broke. My wife and I have NEVER gotten into an arguement in the 6 years we've been together (2 years married). Having money removes about 80% of the stress from life.
We have paid off 1 credit card, and saved the $1000. $7000 to go still, + $6500 where we are not being charged interest yet. Thanks for the motivation, Dave Ramsey.
Yes! Wish I had the mindset to do this sooner. Every time there was an emergency. Went straight to the Cash Advanced office like it was a normal thing to do! Ugh. The amount of money I gave away to them makes me ill. No more!
Having an emergency fund is so important. There always seems to be a small unexpected expense that comes up every month that wasn't in the budget. And a big unexpected expense that comes up every six months.
It’s funny before I started listening to Dave, I never thought about saving money. I kept up with my bills, but I just didn’t save anything. So if I did have an emergency I just used my credit cards and then paid them off. Until I started to listen I didn’t realize how just $1,000 could keep me from repeating this cycle. And $1,000 is really no money at all. At this point I had worked at my job for about 15 years, and I thought what do I have to show for all those years!!!!! Well now I’m on the right track I have $30,000 in my emergency fund ( step #3) , saving 15% for retirement and able to sleep 😴 at night. What was I thinking before Dave??? At that rate, by retirement I would have brought the book “ 50 ways to prepare Alpo and love it”. Thanks Dave. 🙌🏾 🙌🏾 🙌🏾 🙌🏾 🙌🏾
Thanks Dave! Our family during these times have no debt and quite a bit stocked up in our emergency. We live and think a lot easier these days! Dave has been a voice of guidance when it comes to money.
It really does change everything! We have our fully funded emergency fund. Recently we had some emergency dental work. My father-in-law got in the hospital and passed away a few days later. (Several states away from us) Because our emergency fund was in place, we were able to cover that $2,500 worth of back to back emergencies in cash. So much less stress!
Started ramseyfying our finances in may. I overlooked the fact that our car was overdue a timing belt change and i hadn't budgeted for it. Booked it into the garage and we have managed to cashflow the job, not even touched the EF and it is as Dave says an inconvenience thanks to our trimmed down budget. No sweat, no drama. Thank you so much Dave. Appreciation from englishwoman in France.
Baby step six here. $10k emergency fund. 35yrs old/38yrs old. We have a Roth 401k and a Roth IRA. Various sinking funds. Just finished a 2yr journey of paying in cash for a large medical to do (non emergency but necessary). Less than $49k income.
I started our emergency fund 3 months before our first ever emergency because of Dave. My wife just lost her job and we have 10,000 in the bank, the relief that causes us is huge! Do it people, whatever it takes and even if you feel like you’ll never need it
Having the $1000 really gives you peace of mind, especially if you don't touch it but for the most dire of emergencies. If you didn't have the emergency fund, you'd try to cash flow the emergency or look at selling stuff or pick up a temporary job to pay for it. Still use that thought process to handle the emergency instead of always going straight to the emergency fund. That's my two cents worth of advice. Every family & every situation is different. Do what you believe to be the best course of action for you & yours. Peace.
So I just started following baby steps and I have 3,000 in emergency fund. My truck started to leak a lot of coolant(waterpump). I was stuck away from home. It felt good not to worry. Just called tow truck driver, got myself a chocolate shake from whataburger while I waited for tow truck driver. And even though he charged a bit more for late night tow, I ended up blessing him with more than he asked. Felt good not to worry...
Having an emergency fund is a life saver. My car broke down and the cost was 700$. I didn’t freak out or panic cause I knew I had that money there for that reason. It really gives you peace of mind!!
I must thank you dave I use to make over 100k and never had a emergency fund before I retired. Together with my ex wife we made over 200k and Spent most of what we had. I got a divorce started watching your show taking home half what I make yet I was able to pay 2k to fix my car without no stress. It takes a lot to just humble yourself and do the common sense thing.
I used up my emergency fund because of an unfortunate health issue so i have to start over. I still incurred a little debt but at least I was able to pay for most of it in 4 months while staying current on my expenses.
Paying off car today then going to tackle mortgage. Goal is to be out of mortgage debt in 5 years. Then maxing out retirement and keep adding to emergency fund.
This shutdown proves how an emergency fund is needed. My parents raised me to be moral, avoid welfare, and have an emergency fund. Pay attention to Dave and intelligent elders.
This video is nothing but truth! An emergency fund changes everything! I have a monthly expenses replacement fund and an emergency fund account. I sleep so well and am thankful every single day.
I have a $250,000 emergency fund, and when the transmission on my pickup truck started slipping, I just went out and bought a new truck. No stress, no drama.
There was an excellent article written by Neal Gabler in the Atlantic called "The Secret Shame of the Middle Class." And he cites a research report conducted by Financial Reserve Board asks that if an expense of $400 came up, how would they pay for it?" And 47% of people said they either couldn't pay it or they would have to sell something or the borrow the money. when asked if they can come up with $2000 in 30 days, it's only about 30%. Most people only have enough money to keep going for 3 days if their income suddenly stopped. So yes, it's very weird to have an emergency fund and it shouldn't be. Gabler calls this financial impotence and for good reason. It's more widespread then people want to admit. People don't want to talk about it when it does happen. And so they just ignore the problem. Easier to ignore it and hope it goes away.
Back in December I was living paycheck to paycheck and barely making ends meet. 5 months later and I have been able to save over $4000 in my emergency fund. Working towards $10k!
I can't believe I used to live without extra money in my bank. How reckless I was. Emergency funds and savings in general are a blessing. I don't know how more people don't save. I used to be the " I can't, its not possible with my income" and now I've got a great cushion. I woulda laughed at myself
I find stacking money in the bank more satisfying than spending for stuff I may or may not need.. it’s GROWTH. It helps me feel that my household is secure and it’s just a huge step in your personal being..
Started my emergency fund in Feb of this year and finally reached 1,000. Still want to keep padding it because I still feel rocky on $1,000. With owning a home I feel like I need $3,000 to be comfortable. I'm getting there!
Midwest Badger i agree you need to keep funding it especially with owing a home don't stop just there thats just the beginning keep building in fact you should have one just for housing expense also. So and emergency fund for emergency and a Housing fund if your able keep building both without putting a limit on them
We have our fully funded EF plus some sinking funds, which we can pull money out of if needs be. For instance, the 'next car fund' can take the hit of an unexpected major repair or insurance deductible, the 'home fix up' fund can cover a new water heater, well pump or the like, and the 'medical/vet fund' can easily cover that ER vet trip or misc. health care costs that arise. Our EF is our BIG cushion we try never to touch, and our sinking funds are our little helpers that keep it 'safe'. OUr system isn't for everyone, but it works for us.
I work for an insurance company and I can tell you there's a huge difference between individuals who are ready to face an emergency and those that aren't. Car accidents create a situation where Murphy is just hiding in the corner, waiting to pounce. You've checks that don't come right away. You've got delays in the investigation because the drivers of the other car are refusing to cooperate. You've got to wait for an estimate. There's sometimes even miscommunications. Whatever it is. When you don't have an emergency fund and something goes wrong with the claim, you're dealing with everything at once. Like if a check doesn't arrive at the shop on time for them to finish your car, because now they're not going to release your car, and the insurance company hasn't approved extra days in the rental. You can't reach the adjuster because he closed your claim and left the office for the day. It's a mess! And you're having to deal with it all at once! So now you're stranded and now you're whole day is ruined, and you're panicking because you got to get back to work. When you have an emergency fund, you can deal with it bit by bit. You can say, "You know what? I'll just pay for this now, get my car, and then when I get home, I can call the adjuster. If he's not there, no biggie, I can wait for his return call so we can discuss the insurance reimbursing me." So now the situation goes from completely unmanageable, to just annoying. And you can deal with how annoying it is because you're dealing with an entire fallout.
I totally agree. Dave Ramsey, I personally experience that in my life, the rain days and nights do come. And, yes I had put a emergency in place. That's what save me. Yes, I do have a peace of mind when I paid cash for it too.🤗
Thanks to Uncle Dave's guidance my wife and I were able to purchase a new AC unit for our home when the old one blew. Our emergency fund made that crisis an inconvenience. Thanks for your advice Dave. God bless!
Just diagnosed with cancer. So grateful I’ve been stashing money in savings for 3 years. I really hate to spend it but at least we won’t be in financial crisis. One less thing to stress over.
Paid off my student loan of £2990 due to 3 jobs and gezelle intensity in only 3 months. Still over paying my mortgage and investing during that 3 months. Over here in England. Thanks Dave for the guidance /videos and book.
From Leo: Old saying among soldiers after the war; "ain't much trouble a man can't fix with $900 and a 30-06". Problems are a lot easier if you have the resources to handle them.
Emergency funds are important and if you don’t have one I encourage you all to start. And you can start small and build up. That’s how I did it and now use a two fund approach for my emergency fund savings strategy.
When you start managing your money, you realize that there are very few true emergencies. We saved $12K at the beginning of 2015, after we paid off our student loans, and we haven't touched it since. We haven't had any major problems, but, without debt, it's a lot easier to cash flow the normal unexpected expenses (ex: a $500 bill from the mechanic). I think many people don't get the point of an emergency fund. It's basically a form of self-insurance, only to be used when all the other cash is gone.
I doubt if I’d be this far along in my plan to be debt free if I hadn’t happened upon Dave’s show back in late 2013 or early 2014. Didn’t start right away. Had to get current first, then increase my income. I know I wouldn’t have thought to do Baby Step One. I would have jumped right into Baby Step Two. Well, my version of Step Two. Probably would have just upped the monthly payment some, but not snowballed it. It was exciting to use those online early payoff calculators and compare how much sooner a debt would be paid off, depending on how much more you increased the payment. So grateful I started listening to Dave!
This time a year ago, I went and financed a new vehicle, rather than pay to repair the transmission on my paid off car, because I didn't even have the money to have my old car fixed. One of the stupidest financial decisions of my life. But now, I sold that new vehicle, and I am driving a quality paid off used car. Not only that but I have money in my emergency fund! So much can change in just a year. Thank you Dave
250 in the bank and was told today that my daughter may be coming in three weeks . It's a start . Praying that 1000 is there before she comes . Been living off tips to go ahead put checks at the savings . God will help with wisdom and peace.
I only have $9k in my emergency fund right now, but this past year I've had $4600 in expenses from a furnace repair, two car repairs, and a doctor's bill for lab tests. I also paid off my car which was an additional $6000. Now the only debt I have is the house with $19k left on it. My goal this year is to have more money in the bank than what I owe on the house by the end of the year. I'm not paying off the house though until I can do it while still keeping 6 months of emergency funds in the bank ($18k)
Don't own a home without one. Been on the dave drug since 2005. There are no financial emergencies with a back up fund only emotional ones. Took 3 years to build but worth it.
Impressive kid! I’m teaching my son who just got out of high school to have an emergency fund and do the same. He’s about $400 in which is good considering he just started working a month now.
Sir We Are About to Die I already got a job. This year will make 70K next year more. Going to purchase multi family and live in 1 unit so I don’t have a mortgage. Don’t worry ;)
I had a 20000 EUR emergency fund when I was 18 and spent a lot of it travelling a fun. I've been a spoiled brat. I gave 7000EUR left and 14 000 EUR debt. Now I'm getting my things together. I want financial peace ! The debtor is solve to the lender !
I keep around a 70k e fund and have 200k in student loans. I’ll have them payed off in 12 months. Then onto investing and saving. Always been a natural saver and have a savage income.
When you have an emergency fund, you lose your dependency for a credit card, especially if you have been able to grow it a bit. It's like your very own interest- free debt- free credit. Awesome!
1k isn't enough for an emergency fund for me. Too often I've had emergencies come up requiring more than that so for me it's 3k. It really did lift my anxiety so much once I got the emergency fund and had a plan that I knew I could execute to get rid of my loans. I had no idea how much the stress was affecting me until it was gone.
Just found out my trucks frame is going out. Currently have only $7000 to my name but wouldn't have that if not for you. Luckily no credit card debt but I do have student and truck loans, but I can pay the truck off right now and be ok on my bills. Hopefully the truck will last until tax time so I'll have more money set aside and there will be sales so I can get something decent.
Amen! It is one of the best things to do. All under putting your trust in Jesus. God may decide to let you go through a financial storm to test your faith in HIM.
Jesus recorded in the synoptic gospels: I tell you the truth, it is hard for a rich manto enter the kingdom of heaven. Again I tell you, it is easier for a camel to go through the eye of a needle than for arich man to enter the kingdom of God.
Ricky Allen happens to me as well, I think the best way around this is to focus on increasing your rate of income and how much income you make. That’s what I’m currently focusing on so I can build an emergency account. Because what I was making I would always try to set aside but it would get burned through too fast bc of an emergency. You gotta get more money faster than the rate of emergencies in your life.
I got one credit card 0 interest for 18 months before I found Dave. I used it for a month covering my bills, where I paid off 2 credit cards , and saved the $1000. It helped me breathe, next month we start with the envelopes. $2000 in one credit card $3800 in the other one ( which ended up being the same amount on the credit card that I have over a year to pay)
If you are following the baby steps, the $1000 is baby step 1 and is supposed to be an easy-to-reach motivational goal. Baby step #2 is paying down non-mortgage debt and #3 is building up a true emergency fund (3-6 months of expenses). If you chose to target $2k or $3k and trying to get there wouldn't cause you to lose focus on the goal of ultimately being debt free, I'm sure DR would be fine with it. You'd end up paying a little more in interest on that debt as it would go unpaid a little longer, but that would be a trade-off each person decides individually [ie, how much is it worth to you to have $3k in the bank wehile you are paying off debt versus $1k?]
I read in a comment section once "An emergency fund seems like a Super Power", or something close. And it is. With an Emergency Fund you don't have to break out the credit cards or even worse, go to a pay day loan place. The super power of an emergency fund is it helps to keep you out of the debt cycle.
