I listen to this entire audiobook at one time while working in December. I was negative in my bank account, and $20,000 in consumer debt. My income at the time was 12,000 a year. Me and my two young boys cut up all the credit cards that the family had. With God blessing my path, as of this week, I have paid off all the debt. My family had been through some intense changes, and I found myself as the only income for my family of four, by listening to Dave and his advice, and now I have control of my finances. I appreciate you, George and Dave in the blessing that this has been to me and my family.
@@robedmund9948 exactly. Patience and sacrifice is no longer a thing for people. Even though for most just scraficing for 18 months(not long at all) to catch up on finances and paying off debts will help tremendously but god forbid you miss that concert or vacation or going out to dinner once a week or this or that etc… This is my step mom and my dad. They make 150k/year and they’re not just broke but they finance literally everything and don’t have enough(unless they use credit cards) to cover emergencies. Not to mention retirement, both close to retirement age and have very very little. If they just took even 1 single year and did nothing but attack debt they’d be in a exponentially better spot but as my dad says and has been saying since I can remember “We work to be able to enjoy these things, I can get hit by a bus tomorrow” well, he’s had several thousand tomorrow’s and more to come. It’s extremely sad.
It is strange that the Ramsey Baby Steps work in every economy😂. I am in Ghana, our inflation is now close to 60%. I have been on the plan for the past 5 years. I am debt free with a paid off built modest house and living the life of my dreams. Thanks George for this beautiful video. The plan works everywhere and every time ❤
An emergency fund of $1000 is better than no emergency fund at all. It gives you the confidence to tackle debt when you have an otherwise stable situation.
And because $1000 now is not the same as $1000.20 years ago, they have started saying that it should create a little bit of tension so that you get out of debt faster and can build up the actual full funded emergency fund. I think that’s wise.
Agreed, but I tend to agree with The Money Guy show when they say your starter emergency fund should be the amount of your largest deductible (be it homeowners, auto, or medical). That personalizes it without being extreme and many times the emergencies you face fall under those categories.
Agreed. That's what we do for our HSA, tax free acct. I have a line at my deductible that I sleep well if it's there, And constantly add to it all year round.
Considering 60% or so of Americans can't come up a "G "for an emergency expense $1000 Far better than nothing but some criticism is fair as $1000 doesn't go as far as it used to. I'm of the opinion once you notch a couple of wins and see it work maybe start squirreling a bit toward building your fund larger. I'm more a fan of the The Money Guy FOO. Yes, getting rid of high interest debt is important but to pause the 100% return of a 401K match (something that was far less common when the baby steps were born) is not ideal for your financial future.
FPU and the total money makeover changed my life. Sounds dramatic, but I had no direction in life before being faced with a crisis (son diagnosed with cancer). We got into FPU a couple months later to manage the influx of donations, and the rest is history. Currently on BS3. Son is doing amazing. Happy, healthy 8 year old.
We paid off our house and are completely debt free as of August. I recently gave the Total Money Makeover book to a friend who is always stressed about money and he is looking forward to reading it. Took me awhile to swallow my pride and realize I didn't have all the answers and finally decided to follow the steps and it worked! Took a little longer for me because I would get sidetracked and buy shiny things and then would go back and be focused on the step I was on. Cheers!
I’d have to say the criticism is not unfounded. $1,000 won’t cover some car repairs anymore or tires for that matter. If your hot water tank goes out, that won’t cover a household 50 gallon tank and installation, any appliance is close to that number these days. The 15/30 year mortgage debate, here is my take: I took out a 30 year loan and budgeted for a 15. That way if something happened I had a cushion and would not immediately default. I paid the house off in 16 years, a new roof after a hurricane and a new AC unit set me back a year, but I had the money and the cash to pay for everything without defaulting, better to have the the roof over my head then out on the street. I agree with the mortgage tax deduction, it’s a stupid argument, pay it off. Lastly, I fly a plane, I do fix my own AC, and I learned 10 years in that low cost mutual funds far outperform the actively managed funds being sucked off of you. The compound interest formula works just as well for your financial advisor as it does for the bank. That 1-3% adds up over 39 years of retirement savings. It’s also good to know most financial advisors are not fiduciaries, which means they can steer you into bad decisions if they can benefit from it. Keep that in mind when you see your financial advisor, are they a fiduciary, if not they have no legal obligation to look out for you…..
$1000 will get you 2 brand new tires, which is still plenty for 99% of passenger vehicles on the road today, let alone decay to go. A thousand dollars especially if you can do the work yourself, Is enough to replace a radiator both coolant hoses, Your Kevin filter or filters, As well as a thermostat. With still plenty of room to spare. It just depends on the individual car repair situation. But again, the one fact that so many here in this comment section of this video, as well as so many videos on day, ramsay's youtube channels keep missing.... Babysit one was never meant to be a fully funded emergency phone. It is only mint as a quick and reasonably easy. Attainable goal to build one self-confidence 2 want to continue the rest of the steps. Dave, you've even said so himself today as well as 20 something years ago when he started the babystips idea.
A grand will let you patch up some stuff around the car, or replace a broken washer, fridge, laptop or phone. You're also not supposed to stop saving at a grand and nobody will be mad if you do 2000 Dollars
As a relatively high income earner, Dave’s plan saved my life cause i was living paycheck to paycheck. Now i no longer have panic attacks in the middle of the night thinking about money.
Still on Baby Step 2. My wife and I paid off 51k in 20 months making 68k a year, giving us the margin to take a pay cut and get a job in my field while we were in stork mode for my son, after a few months of living la vida loca when he was born we kick-started step 2 again in January of this year, paying off 10k in 4 months. Then we found out we're pregnant with baby #2, due in February. I'm definitely not the poster child for doing it fast, but I'm able to afford a family of four and my wife downgrading to only her seasonal job she loves instead of 40 hour work weeks. We got rid of 1500$ in payments and will be chipping away at the remaining 27k
@@David_Torpedo Thank you. I kinda feel like I'm treading water for the next 15 months between saving for the baby and the big cut in income from her staying at home. But 2 aggregate years of gazelle intensity turned us losing her full time income from "Cripplingly terrifying and keeping us up at night" to "an annoying math problem to make progress on the snowball"
@@alexpietsch7997 Yes, exactly. That's amazing. When you do this stuff, what would be a nightmare is just in inconvenience. I get how you feel though bro. I'm in the same boat. I've got baby number two due in December with my wife not earning nearly as much now as well. But you got this man, you're working it and it's working!
The plan has worked for us. We are in BS6, are Baby Steps millionaires, and are on track to retire early (even though we didn’t start until I was in my early 40s). It can be done!
@@dreamwe2 That's pretty much right where I was. 42 with a car loan, a personal loan, a mortgage, basically zero net worth, and no real plan. You can do it!
We used a 30 years mortgage for our house for a low monthly payment but paid it off quickly by extra payment on the principal most of the time , and when we had money issues for other reason , we knew we could make the regular monthly payment anyway on the mortgage .
Did exactly the same. Remember folks, it's a template, not an instruction manual. Everyone's situation is different. Dave is quick to point out that no one is coming to save you and YOU are responsible for YOU. This applies to Dave as well. He isn't going to send you a check when you need bailing out. You have to tailor the plan to fit your situation.
We did the same thing. We got out of debt and then snowballed all of that money into our mortgage. Paid it off in 18 years and have been debt free going on 7 years now (and I’m only 53!)
@@motoryzenyeah tell them to borrow from library and when they get out of debt buy it. It is not hard well that is unless you think millions more won't make it then if they buy book you still get profits even if they fail.
My wife and I paid off her $80,000 student loans and now we’re on baby step 4,5,6. It’s the best. We’re finally starting baby step 6 since going to Smart Conference. (In May we dropped by Ramsey Solutions and got a pic with you and Dave!)
I followed the Baby Steps before I ever heard of Dave Ramsey. It just made sense to get out of debt and live on less than you make. But I still pay for everything with my credit cards and pay off the full balance before the closing date so my statements are always zero. That way, I get all the points and benefits for what I spend and never pay interest. And I save 50% of what I make towards retirement instead of 15%. The trick is to earn a lot and spend a little. A big pile of cash earning interest is a lot more satisfying than anything I could buy.
Shhhh!!!! George will hear you! In all seriousness, you probably can’t argue with the math on that, if you make 10,000 a month, and you spend 6500, and use your credit card, and the balance is paid off, and you get some points on it, I’m not sure anyone could really argue with you that you did anything wrong, except, of course, with George and Dave would say is that you were probably spending more than you would otherwise, if you just use cash or even a debit card.
I agree with this, credit cards are not bad as long the balance is paid off the balance every month. However some people don’t have the discipline to spend less, hence why Dave is ‘anti-credit card’ and his horror story either ‘American Depressed’ 😮
I've been following the Baby Steps for 2 years now. 1) Already $1,000 when I started 2) Paid of $52k in debt in 26 months 3) Currently cash flowing our wedding and the purchase of a replacement car for me Once the wife and I settle in after the honeymoon, we estimate that we can pay off the debt she's bringing into the marriage in about 12-18 months on our combined income. Can't wait to taste the freedom!
We started in 2017 with $20k in debt and floating expenses on credit cards. We’re now consumer debt free, have a huge savings pile for replacement vehicles, a huge amount of home equity to n a modest home and in the black every month even after retirement, college, and car savings. Anyone who says it isn’t possible through this plan is someone who refuses to act like an adult.
Have listened to Dave R on the radio for years. Finally bought the total money make over book for a buck at used book store. Got the second , new, at barns an noble but on sale 30 % off as a gift to me for Christmas from a friend. Then discovered dave on you tube so lots of great information . Thank you ! And yes debt free, no mortgage , no payments, retired and next purchase may be a new vehicle, and will be paying cash. But procrastinating because hate to buy something that will loose 25 % the minute I drive it off the lot. So may keep current 18 year old , 140,000 miles , running good car . Love driving when former employer provided a new shiny pick up truck and gas card and paid for oil changes and tires as needed. Got a new truck every three years. Also on call 24/7 so got to take the pick-up home. No commute costs. Last car I bought was 2 years old , program car , 50 % off sticker price, had 24,000 miles and came with factory warranty. Did finance for 5 years through credit union buy paid off in 18 months. No pre payment penalties. No car payments in 16 plus years is great.
Great job George, I first read Dave’s Money Makeover book Fall 2019 about 4 years ago and his sage advice completely changed my thinking on money FOREVER. Since then I paid over $172K in debt and just got the mortgage and student loans to go towards being debt free. Dave’s financial guidance is timeless and he is one of the first and few to call out the ‘banking and political cartel’ system hell bent on keeping us enslaved. RESIST!!! 😎
Bought all of Dave's books. I am on BS 6. Looking forward to being totally debt free in 4-5 years. Many of my friends say I am crazy to pay extra on my 2.375% mortgage. I don't feel crazy at all.
As a fan of George and the Ramsey Team, I wish he would have used a contemporary example regarding the mortgage on a 15 year fixed rate. Forget 2019. Think 2023. Take your $240,000 mortgage on a 15 year fixed and this time calculate the monthly payment on a 7% interest rate. Oh, and good luck finding a $240,000 home in this market, by the way; at least one without a need for major repairs.
Check the states your food comes from. Or the counties outside the big city where you drive 3 miles on the highway to get to the interstate. Where I'm from 240k is still a 5 bed 3 bath with a nice yard. 240k is a nice
@@alexpietsch7997I grew up in a small town in northwest Ohio. $240k is nice, but it takes about 300% of the median household income in the area to afford. I then moved to Columbus and $240k gets you a 1,200 SF house in a fringe neighborhood and you still need double the median income to afford it. Comparing cost of living, Ohio has a 80 cost of housing component.
No worries…. That may be because you already value your time.. not wasting time with fake friends will prove worthwhile in time- the reward will be the friendship/relationships that add reciprocal value to each other ❤
Most of my emergency are < $1K. Just last month, the water pipe under my house broke. I called several plumbers and most of them quoted > $1,500. I told everyone that I pay CASH. One guy said he will do it for $500. He came next day. I gave him $100 tip. I live in California Los Angeles -- one of the most expensive places to live. If I can get good service good deals in cash. Anyone can too. Single female no family. People who complain about $1K are just making excuses. My pastor says excuses are like armpits; everyone has them and they all stink!!
DEBT FREEEEEE!!!!! for 5+ years All because of "The Dave's Way" $18,000 Park model home paid for 1 cash payment,,,,, $10,000 2008 Toyota Rav4 paid for in 1 CASH PAYMENT..... 6 months Emergency fund Fully Funded with a bit extra ..... Next Step Retirement woohoo. IT FEELS GREAT!!! Thank you Dave Ramsey!!!
Got the audiobook on a $10 sale a while back. Listened while going for my evening walk. Anyone else felt like you were watching the show while listening to Dave on it?? lol Definitely helped set a foundation for me to get myself in order. Far as things being outdated, adjust for inflation perhaps? 🤷♂
Good videos always George and team. George please talk about the current market , like why car prices are going down, while house market remains high and climbing up. Keep us updated thanks man!
they covered it a couple days ago, I think it was Dave and Rachel talking about rates. Dave summed it up as lack of speculation homes being built, lots of people wanting to buy. or lack of supply and high demand. I would assume the car market is the opposite right now, same amount of buyers as usual and finally more cars on the market.
They shone that data and theyve explained it numerous times across the decades Not a single Marilyn there that they have interview. Said he or she made his or her fortune. Staying in dibt to a house mortgage longer while investing the difference in the cost of a thirty year, monthly mortgage payment versus a fifteen year. Human nature human bad habits don't lie history proofs that as a fact. That's what all you NASA refused to understand. Daves, ideas, and principles involving attacking debt are based upon real life experiences of him learning things the hard way and then trying the correct ways that make more sense in a consistent, sensible, good discipline fashion that works. It's not rocket science, it's life experience.
I love the audio book, read by Dave himself. It is always a good motivation. BS 4, 5, 6 single mom in Germany after 5 years following dave's advice. It still works! Thanks Dave❤
Private investing is the best way to go about the market right now, especially for near retirees, I've been in touch with a wealth manager, netted 370thousand the last downturn, made it clear there's more to the markets than we average joes know.
The home mortgage when it is 3% you are better off doing a 30 year because you can invest the amount you are saving and generally get a yield of 6% very conservatively. The issue of course being most people don’t but it is an opportunity cost.
I am the one debating the 30 year mortgage vs a 15 year one, I live in Scandinavia, our average homes cost about 50-70% more than in the USA: 1 you can't get a house, you can afford on a 15 year mortgage, you can always pay off faster if you have the means. 2 Inflation, money today is worth more than in 30 years. 3 Life, often a house purchase comes together with marriage and kids, a very expensive part of our life. I would rather have money to support my family now, and savings, than fighting to pay off the home in 15 years. 4 when you are on baby step 6 you can go after that mortgage, and have had a comfortable life along the way. 😊Life happens, maybe you have to sell your house for a big one or downsizing, whatever it is, you still build equity. 5 You can claim deduction on your taxes on the interest you have paid that year. I would pay off the mortgage before retirement.
I don't think financial advisors are a scam necessarily, but most people don't need one until they have around $500K in investments. If you're just getting started just throw your money in an index fund, you'll be fine.
And you did not cite any details or examples that would have served to try proving that putting your money in an index fund make any sense yet Details matter
@motoryzen Um, this is the RU-vid comment section, not my term paper. I'm not here to educate you on index funds. Look into it yourself. Or don't. I honestly do not care what some hostile stranger on the internet chooses to invest in.
Giving up our fleeced vehicles for a pair of early 2000’s Toyotas and the cash envelope system were 2 things that made the biggest impact on our debt free journey.
I use one mortgage payment (about $2000) as my emergency fund. This year my salary got delayed by office accounting problems and it made sure I could cover my mortgage without going back into debt again.
A mortgage / rent payment is a great option for a more personalized starter emergency fund. As is the advice to have your starter emergency fund be equal to your largest insurance deductible (be it home, auto, or medical) so you know that in a catastrophic scenario you'll be ok.
I started this video with such hope! But unfortunately you just fought the straw man. Here's what the ACTUAL arguments are that are being made by ACTUAL personal finance people (not the crypto bros, etc.): 1. $1k isn't enough, even for a starter e-fund! People like Caleb Hammer have seen situations where because people only had $1k saved up and they had an emergency that required more than that, they ended up in a worse debt situation than they started in because they now had to borrow that difference on credit cards. Storm mode only works if you KNOW THE EMERGENCY IS COMING which you typically don't. That's why the standard should be "1 month of necessary expenses." 2. Thank you for the doing the math on 15 yr vs. 30 yr, yes, we know that. The point isn't that you're saving money overall, but that you're saving money month-to-month, which lets you start building home equity sooner and get you on the right path faster. You can always pay a 30 yr faster, you can't pay a 15 yr slower (unless you pay to refinance). Also, your math didn't include the average appreciation on the home, and if you're able to afford more home, that means the 15% increase over a decade (or whatever) can actually more than make up for the extra you're paying in interest. 3. If you could get a 30-year unsecured loan for 3%, you better believe it would make all the sense in the world to take it, invest it, and pay what would have been your investing budget as a monthly payment! But no one would do that, which is why it could- if you're financially savvy- make sense to invest the difference instead of paying down your house faster. I'm not saying everyone should do it, but where it makes sense, it makes sense- it's not dumb. 4. This one frustrated me much more. I apologize for the caps, but you can't format comments. THAT'S NOT THE ARGUMENT!! Of COURSE you can hire a financial advisor to help you with your finances- once or twice. What you shouldn't do is give them 1% of Assets Under Management ON TOP OF the crazy cost basis fees that these loaded funds hold when you could just put your investment dollars into a Vanguard (or whatever) Target Date Fund, Total Market Fund, etc. The amount you pay in those fees is utter insanity and is way, way more than paying $150/hr a couple of times per year for a "let's sit down and see where we are" session. I hope you can make a follow up video that actually addresses the actual arguments people are making. I've bought TTMM for myself and others, I'm a huge fan of the work, but we need to be realistic when things change.
4 - The Ramsey Solutions Team have to shill for their Smartvestor Pros to keep that $ rolling in. Just like RST kept shilling for the timeshare forgiveness company because of the $ they kept paying to be a sponsor.
1. I don't know how many times I'm spelled this out for you. All. Dave Ramsey himself said 20 something years ago. Let alone he still saying the same thing today. That baby Step 1 is not meant to be a fully funded emergency phone. That's why he calls it a starter emergency phone. It's meant to handle little nicion Kix of life that Murphy sneaks on us. Period that's what baby step three is four a k a fully funded emergency fund. The entire point of vacuum babystep one be much less than babysit three, and terms of total money saved up is that it's a quick and reashably easy to attain goal. Day front. Do you understand the fact that we first function in terms of human behavior often before we function in terms of math logic because often we don't have the hardcore discipline starting off. When we start anything new in life. We need easy. Small victories to get our confidence up end us. We will be more motivated to keep going for that new plan. It's not rocket signs. It's actually proven historical human fact about human nature with strikes at the core of the problem that person in the mirror. 2. It doesn't make it crap if you pay your house off. In one year, 430 years, whether it's a 15 year fixed or 30 year. Fix. Unless some natural disaster. Really? Screws up your home and property. Both will always appreciate invalue at the same rate regardless of the type of mortgage per. You didn't account for that, did you. 😉 Keeping a mortgage around lower than necessary. Like its a pet was dumb long before I was born and it will always be dumb long after mother. The the dust from my bones are gone from this world. Facts don't care about anyone feelings about this. And the only time when the value of your home increasing matters is when you get ready to sell it. Same thing with the stock market and mutual funds. You only lose money when you sell if the value goes down, and you decide to sell them. That is also a mathematical fact that you're mentality did not account for which is a very coherent and a political analogy to home value, and your flawed reasoning behind wanting to keep a thirty year mortgage vers. Same thing with the stock market and mutual funds. You only lose money when you sell if the value goes down, and you decide to sell them. That is also a mathematical fact that you're mentality did not account for which is a very coherent and a political analogy to home value, and your flawed reasoning behind wanting to keep a 30 year mortgage versus a fifteen. If you're reasoning behind valuing a 30 year mortgage over a 15 year mortgage is that 30 year, mortgage monthly payments or cheaper than a 15 does, allowing you more financial cushiony, that's what he babystepped 3 as 4. 3. No, it does not make all the sense in a world. To do exactly that. It makes absolutely no sense to start investing if you're in debt. If you can't afford to pay down a house in 15 years. Then you cannot inform to investigate. You are introducing an extra variable of risk. See, that's the problem with your people's way of thinking, you never account for the risk and what ifs. What if I lose my job. What if I get injured and I can't work for a while. Oh, crap, I'm still in debt. Oh, crap, I'm now locked into a deal of investing. And now I have to face the embarrassment of calling my financial a viber visor and tell him her to stop the auto drafts of investing out of my checking account into the mutual funds fire account. So many people just assume life works out perfectly. And it never does. These people refuse to face reality. Why else do you think dave always spouts getting out of debt first before investing question? He's been there and Dunn that can his 20s. He used to leverage debt to make his millions in those days. And guess what all it takes is the right person or group. Buying out a company that you are involved with. That gives you the deadline and then beside to call the loan. Meaning you now owe it all up front. Are they make your life a living Hill. And guess what legally it can and still does happen to this day.
From how you're coming reads, It seems like you've been trying to build your savings higher than the baby. Step 1, and you have, and then the second part. You're coming, actually, you've only reached that 3K point. For the first time. Which is it?
I hear the “$1,000 isn’t enough” all the time. That’s like saying “my first 401k contribution isn’t enough to retire”. It’s called Baby Step 1 for a reason.
You honestly don’t think that these numbers should be adjusted for inflation? He hasn’t changed his formula since the 90s. Minimum wage for tipped employees hasn’t changed in 30 years, should that not be adjusted for inflation either?
$1000 is better than nothing. But having all of your deductibles covered for your insurances would be better, in case an emergency actually does happen. Insurance is designed to protect in actual emergencies, but are only as good as your deductibles can cover. Then, after debt is gone, you can build up more of a fund in case of job loss or prolonged health challenges. I still think a 30 year mortgage is better. If you lose your job and can't pay your mortgage, they don't care that you've been paying on a 15 year note. They don't care if you've been paying extra. Your money is locked into the equity of your home. Save the extra in a special savings account, and if you get to the point where you could pay it off in one go, then do it!
Hey George - where are you getting 3.5% or 4% interest rates on mortgages these days?! It’s up to around 7% - which would have made your point even more dramatic!
Don't disagree with the plan, but I feel like the hardest part of it all is getting your income up. Essentially telling people to "just make more money". Like geez George wish i had thought of that.
Most people want more money, but their idea of that is just getting the boss to give them a raise. When people intentionally set out to earn more money by working overtime, switching jobs, starting businesses, doing side hustles… they are often amazed at how much more they can earn. It takes creativity and the path is different for each person based on their skill set and available time.
I get all your points about the $1000 emergency fund. But WHY NOT make it $2000 now? If $1000 was the right about 20 years ago, why not adjust it to the new right amount? It wouldn’t affect any of the points you made. It’s still not enough to let people be worry free or lazy.
Because 1 grand is twice as fast as an achievable goal than 2 grand. The core point of thr baby steps getting you motivated to accomplish all of them is some quick goals being accomplished. If a professional trainer told you to go ahead and start bench pressing 200 pounds right now. When you know good, d*** well you're struggling just to b**** Press 100 pounds 1 time. You are not gonna feel motivated enough to keep trying to bench. Press 200 pounds. But more coherently or a policy, you already know, you'll be able to reach a 100 pounds. Bench pressing sooner than you will reaching 200 pounds bench pressing.
@@motoryzen I get that, but that “right” amount depends on the value of the dollar. I’m not arguing it should be more than 2003’s $1000, I’m arguing it should be the same which is $2000 now. It should be just as easy or hard for someone to save $2000 now as it was to save $1000 in 2003
Because Dave's ego is too big to admit that it needs to change, especially at this point. And realistically it shouldn't be a flat amount for everybody just like Baby Step 3 isn't a flat amount for everybody. Your Baby Step 1 fund should be based on you and your situation. The two best pieces of advice on this topic are 1) Have one rent/mortgage payment as your starter emergency fund and 2) your starter emergency fund should be equal to your largest insurance deductible (be it home, auto, or medical)
I don’t get why Ramsey Solutions doesn’t change baby step 1 to 1 month of expenses. That’s how we did it at the time. It’s an inflation-proof method. Ramsey Solutions can push back on the critique about the $1000 all it wants, but the critique is justified in my opinion
Yup. They'd be wise to make it a rule around your own personal situation as well. Like 1 rent/mortgage payment or your largest insurance deductible. If you know you have that it's a lot more freeing emotionally to start tackling Baby Step 2
Because too many people would never get there. $1000 is attainable, easier to get. May be by selling something. If you can't get through step 1, your not going anywhere.
I disagree with 1000 being helpful. I had 6 k while paying off debt. Good thing I had more than 1000 Is storming stork idea is bs also because there's things That come up that you don't know about. Our previous landlord was doing shady stuff and we're forced to move. Total cost to move was a little over 3k . Not including anything else . 1 k would be hell. Fun fact, when that thousand-dollar starter fund was incepted ,,,when you adjust for inflation that amount today is about 3200..…..
Make sure to get a flat fee financial versus a percentage accirding to Clark Howard. It will save you thousands annually. I used a Dave Ramsey recommended financial advisor. I lost hundreds in 6 weeks while my friends used a non Dave Ramsey person and their accounts gained more than I lost in the same time period.
I think the principles and steps are valid, however there should be some updates. With one person $1000 may be enough, but not for a family. However, having a small emergency is valid, just adjust it per size of family. Maybe there should be some clarification like that provided in the video? The mortgage situation is awful, so glad we bought before the interest hikes. The interest shown in this video is not reflective of todays rates.
Baby, step one is not meant to be a fully funded emergency fund off multiple months of living expenses. It's just meant as a quick, easily attainable savings goal to prove to one's self that he or she can do the baby steps, and it handles most of the little shin kicking situations that life can throw at. Baby, Step 1 is not meant to be a fully funded emergency fund off multiple months of living expenses. It's just meant as a quick, easily attainable savings goal to prove to 1's self that he or she can do the baby steps, and it handles most of the little shin kicking situations that life can throw at a person. Everyone here wants to Knick pick baby. Step 1 saying the same things when they keep forgetting. We're not dealing with a math part. We're dealing with the part to get app and going on a new plan. It is understanding the psychology of the human mindset in the context of trying out something new and you want to see immediate results.
I think the issue some people have with some of the steps is they need updating. What’s wrong with that? Things change over time and sometimes so should advise.
Which step or which steps need updating or changing? If it's baby, Step 1 which it seems like a Dom, it doesn't commenters here. In the comment fiction this video love harping on, Again, David stated this for the past 20 plus years. At babysit warn is not meant to be a full emergency fund. Even back then, it wasn't. It's meant as a simple, fast, easily obtainable goal to have a little bit of money set aside to handle most of life's shin kicking incidents.... And let you build confidence in yourself that you can accomplish the baby steps all the way through and become wealthy.
But you won't get the biggest results. The fact that they advise to ignore any employer matching for retirement (which is typically a 50-100% guaranteed return on investment) shows that
@@SJhikes never said it wasn't. But lets be honest here: the baby steps aren't about the fastest way to building wealth. They're also not the fastest way to get out of debt (that would be the debt avalanche).
@@joecross1561 the fastest way is the way that works in the real world. The avalanche doesn’t factor in the psychological boost that comes from the snowball. Without the success of smaller wins, most people will not see the avalanche through to the end.
@@SJhikes No, the fastest way is the fastest way. Math is math. Dave is anti-math because he leads with emotion. That's fine, and that might be more successful for a lot of people. But you can't argue that Dave's method is the fastest because it's not.
George, I get it; you’re all in on Ramsey. Change the 1K emergency fund to $5,000. U said yourself the 1K is 20 years old. Don’t waste my time and please think for yourself just once in a blue moon buddy
Median home price 2023= $410,000. 20% down $82,000. Monthly payment = $2,861, that's before utilities, property tax, insurance or maintenance. Payment no more than 25% take home pay on a 15 year = $11,444 per month = $137,328 TAKE HOME PAY after taxes. If you make less than $200,000 and don't have $80,000 cash, you can't buy a house according to Dave.
@@marshall2.015 not as much lower as the housing prices… when I was in business school they had a cost of living calculator so people could compare their offers in a realistic way and generally the premium you got working in the big markets didn’t make up the cost of living difference.
@@SovereignMoney maybe skewed is the wrong word but the number of homes in the top part of that line are disproportionately in those HCOL areas like California… there’s like 14 million homes in California and like 8 million in NYC alone (that’s like 15% of the houses in the entire country in just those 2 places) so the top of that line is full of the most expensive houses in the country and not representative of the housing markets in most of the country
It works. I did it before I ever heard of DR. (scotch-irish farm raised parents. My spirit animal is Scrooge McDuck) 3 kids and so far they are doing it. Son is on fire. Oldest D is working on it, youngest is just starting but I have faith. Its behavior, not math. Wife and I had some problems because her fam is/was the picture of how not to use money. Looks like it is working out at the moment.
I live in Los Angeles and looking at all these examples of 250k homes makes me wanna die. Where is the financial advice for people trying to by 1.5M houses
Gave high school grads in our family the total money maker book. Note inside some pages with my phone number to call me when they get to page...so far no phones calls...
It's so funny that you brought up the Presidential Award, because I was just talking to a Phys Ed teacher about it today. 😆Of course, she won it back in the day. I, on the other hand, did not. 😁
This method works, it’s taught me how to make my money work for me not against me. Single mum, debt free, mortgage & a good emergency fund. Growing that emergency fund atm. Aim to pay off my mortgage in 5years(even though mortgage is over 30years). Teacher, rubbish wage. If I can dig myself out of a hole, anyone can. Do it! (Borrowed the book free at the library)
Just wanted to here your thoughts on the 15 year vs 30 year mortgage. Wouldn't it be better to get the 30 year mortgage and pay 1,146 and then pay an additional 600 towards the principal every month so it would match the amount you'd pay for a 15 year mortgage? This would give you a buffer in case there are tough months, you're not obligated to pay 1700 and you could just pay 1,146. Then you could resume paying extra on the principal when you can.
The buffer is your efund. Pump the Efund up. What about little across the span of a year. More than ninety percent of all people who claim the same thing you claim, Which that content make sense in the context of the mission a paying it off well before thirty years. So don't get me.,.... Never accomplished paying off a 30 year mortgage in 15 years less. Because human nature and history have proven that if there is room to cheat., Such as easy access to cheating on a good diet or be training someone out of a sense of complacency and greed., The person will do it AK dial. A.k.a. Cheat and not accomplished the original mission. Either it or composite on the original time agreed upon. In one aspect, this is no different than the mission of building muscle to be able to lift, push. Move heavier weight in life. Your body is not gonna let you cheat. It is a 3 variable mill deal that is required., All three One. Put in the work. Effort matters. Form matters more than speed and heavier, weight. Slow and control. Every rip every time. 2 proper nutrition. Balanced diet. Cut back on the carbs. If you're used to eating more than 3000 calories a day or more than a 100 carbs, a day or a 150 carbs a day. And add more protein total each day that you can soon. Period Three, the final and arguably the most important point of these 3 meal deal variable is proper and consistent. Sleep. Sleep is how your body heals. Repair things and builds muscle.
@@darthstrukt a six month emergency fund is fine, but what happens if you're unemployed for 9? The extra space in a budget on a 30 year fixed can help you stretch and prevent you from taking on debt
@@darthstrukttrue, but what if life throws a curveball at you and you become unemployed and you get hit with an emergency that drains your emergency fund to near zero at the same time? Paying 1100 on a mortgage would be easier through tough times than being obligated to pay 1700
Well, it worked for my family. You feel so good once you have that $1000. And let’s face it if you can’t even save up 1000 how are you gonna save up 3,4,5 or $6000. The whole point is to get the snowball rolling and in terms of the credit card thing, if you are in credit card debt you are not a credit card person. end of story. We did a 10yr mortgage on a foreclosed 563sq ft 1950’s condo. Paid it off in 2yrs 11 months making under the median income. And that was during 8% mortgage rates!!!
Im on track to paying off all of my debt by spring of next year, the method is simple and works. The only thing I've adjusted was increasing the 1000 to roughly 2000 for my own peace of mind. At the end of the month before i get paid again anything over that amount gets chunked at a debt.
Guys, its important to have a financial advisor who you continuously pay a fee for (through us). Just like how you pay a plumber a retainer at all times... oh wait, you pay them once and that's it. If you must, pay an advisor once to give a recommendation and let it sit for 5 years. You don't need them to actively manage it while the mutual funds they invest in also manage it and then undo all that work by splitting it among 200 contradictory funds pulling in different directions.
The main chore of the point that dave and george camel made involving this is that there is no single human being on this planet, who has literally the chronological mathematical time to be all of the following every single day. A doctor, I, plumber, a mechanic, and electrician, a carpenter, a draw, while expert, a floor expert, and accountant, a martial artist, a fire arms expert, a lawyer,. farmer, ..the list goes on. It pretty much goes without saying that common sense. To tell you if you want to be rich, do what rich people do if you want to be physically in great shape. Then do what those people do. I professional real financial advisor is in the general context supposed to be exactly that. If you are new to the investing world, and you don't have a clue who or what to invest in and how everything works, then.
@@motoryzen I think he makes a good point that the professionals can do it better, but they also come with higher costs that offset the gains. I can do my own basic plumbing, medical care, electrical, interior decorating, cook my own meals, etc. I can't afford to pay for all of that to be done, but I can do it much cheaper myself at a slower, poorer result. In my opinion, they should recommend hiring an advisor for a one time fee and then keep it there for around 5 years at a time before getting another consultation - really they could get away longer. I also don't like that they always claim you can pick a fund that has done well in the past and assume it will always do well going forward and somehow beat the odds and over perform indefinitely.
@@Excalibur2 Good luck finding an actual insured and accredited financial advisor that will do exactly that. To a 41 time fee, you can actually afford to pay up front. In United States. I'm America. Because I have yet to find a single one.
@@motoryzen good point, I'm not sure how they work, but I've heard of fee only financial advisors. I've always done my own investing - just basic index funds. If not that, a robo advisor or target date fund is also a good alternative.
@@robloxvids2233 yeah, that's why I do my own investing. The only way it makes sense if you're scared and would sell without a coach telling you to hold.
