1. Dave Ramsey
Total Money Makeover

2. Famous Quotes:
“If you will live like no one else, later you can live like no one else.”
“Stop spending money you don’t have, on things you don’t need, to impress people you don’t like.”
“Act your wage.”
“A budget is people telling their money where to go instead of wondering where it went.”

3. The Cash Envelope System
Literally use labeled envelopes to separate your income into budget categories
What is in the envelope is all you can use for the entire month. Once it runs out, no more spending in that category!
It is way harder to spend cash than it is to swipe a credit/debit card
Tips:
Account for every penny (Zero Based Budget)
Budget realistically
Leave the plastic cards at home
Let yourself have some fun

4. Baby Step 1: Save $1000 Emergency Fund
What constitutes an emergency?
Why start here? You don’t want to stop your debt reducing momentum that you will gain in the next step in order to pay for something unexpected.
Once you get it, hide it – make it harder to get to so you aren’t tempted to use it frivolously
Keep it liquid
How long will it take you to save?

5. Baby Step 2: The Debt Snowball
Identify your debts
List in order from smallest to largest (except your home)
Behavior modification over math
Pay the minimum payment to stay current on all debts except the smallest. Every extra dollar you have should go to the smallest debt.
Proceed up the ladder
Become debt free except your home
Don’t borrow any more money!
Note: If something comes up and you use your $1000 Emergency Fund, you should stop the debt snowfall, and rebuild your emergency fund. Then pick back up on making the extra payments.

6. Baby Step 3: Finish the Emergency Fund
A fully funded emergency fund covers three to six months of expenses
Utilize the project to really understand how much money that is
Keep it liquid
Make it hard to access but not impossible
Look at how much risk your family would be in if you or your spouse lost their job to determine how many months you need to save for
Turn crises into inconvenience – Image being able to pay for a hospital bill or new air conditioner in cash

7. Baby Step 4: Invest 15% of Income in Retirement
Invest 15% of before-tax gross income annually toward retirement
Don’t include company match in that 15%
Mutual Funds/IRAs
How much you need at retirement depends on the lifestyle you want in retirement.

8. Baby Step 5: Save for College
Educational Savings Account (ESA) – grows tax free when used for higher education
If you invested $2000 from birth to age eighteen in prepaid tuition, that would purchase $72,000 but through an ESA in mutual funds averaging 12 percent you would have $126,000!
529 Plan “flexible” – allows you to move your investment around periodically within a certain brand name of mutual funds
What if your kids are already in high school?
Work study programs
Scholarships
Work

9. Baby Step 6: Pay off your Home Mortgage
What would it feel like to not have a mortgage payment each month?
Don’t have a house but want one? Make a 100% Down Payment!
“The grass will feel different under your feet when you own it.”

10. Baby Step 7: Build Wealth
Invest
Have Fun
Give Back