Are you looking to be debt-free? To achieve financial freedom? Dave Ramsey tips will help you with that. If you have been researching online for personal finance and debt freedom tips am sure that Dave Ramsey tips must have popped up several times. They are worth paying attention to because Dave Ramsey has helped transform so many lives. If you want to start your financial freedom journey, you are in the right place.
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Wondering who Dave Ramsey is?
Dave Ramsey is an outspoken financial guru who became a self-made millionaire at 26 but lost all of it and at 28 he filed for bankruptcy. What makes him an amazing teacher is that he teaches from experience on how he went from been broke to prosperous again. You can be assured that his teachings and advice are solid as he has been there before.
You are in safe hands. He shares so much financial advice from how to be debt-free, emergency funds to side hustles all over his podcast and on his best-selling Total money makeover book. So whatever you are looking for you won’t leave empty-handed.
If you are struggling with money, then Total money makeover is a must-read. It’s a life-changing powerful personal finance book perfect for anyone who wants to achieve financial freedom. It’s packed with practical exercises and great guides. So many people have testified how Dave Ramsey has helped them get out of debt and they now have control over their finances. His books have immensely helped me especially when it comes to creating a budgeting system that works. His advice is real, he gives charts, simple guides to follow which makes his tips for everyone young, older, and of any social class.
Below are 15 best Dave Ramsey tips that will help you save more and live your dream life. The main reason why Dave Ramsey tips work so well is that they focus on behavior change. It goes without saying that if you continue doing the same thing over and over you will end up with the same results so change is inevitable. If you want to be debt-free, then you have to make some changes.
Without change, nothing will happen. For example, when you are drowning in debt, you first have to realize that debt is bad. Once you understand that you are the problem and solution to your problem then your journey toward financial freedom will begin. You have to make some changes and sacrifices to get ahead.
Dave Ramsey baby steps
Before we dive into Dave Ramsey’s tips here are the core foundation strategies also known as Dave Ramsey’s baby steps. These steps are bite-size, simplified, straightforward steps that will help you become debt-free and you will eventually achieve your financial freedom. It helps you to manage your money way better. They offer you one step at a time which makes it easy and less stressful.
Baby Step 1: Save a $1,000 emergency fund
Having an emergency fund in a non-negotiable because life happens. We sometimes have those emergencies where you need a lot of money asap. I am sure the last thing you want is to get into more debt when you are trying to get out of one. An emergency fund will help you prevent such a situation.
This amount varies depending mainly on where you live. For some people, they will need to save more. The idea is to do your research ahead of time and you will be more prepared in case of an emergency. Your emergency fund should be easily accessed when need be.
Baby Step 2: Pay off ALL of your debts
Paying off all your debt might not be easy as it sounds but it’s a step that will help you a great deal toward your financial goals. Debts steal our joy and put unnecessary stress and pressure on us. We can all agree that it’s a nice feeling to pay what you owe people and get them off your back. If this means you have to look for extra ways to make more money it will be worth it.
His advice is to use the debt snowball method, (this is where you tackle one debt at a time, from the smallest to the largest) as long as you are making some progress then any method is fine. Some people prefer to use the Avalanche method which focuses on paying off the debt with the highest interest rate. It also saves you more money overall but the snowball method gives you quick wins making it easy to remain motivated since you can easily see the progress you are making with your finances. The key is to find a debt-paying method that is working for you.
Baby Step 3: Save 3-6 months worth of expenses
This might call for a profitable side hustle as mentioned above which will make it easy for you to pay off debt while saving enough for your expenses to cover for 3 to 6 months. This will give you security just in case situations out of your control happen such as job loss and death in the family.
It’s also advisable to keep your savings account different from your checking account. You might end up spending your hard-earned savings.
Baby Step 4: Invest 15% of your income to a retirement
Now since you have paid off your debt and you have some savings for expenses in case of a catastrophe it’s time to think about your retirement. This is the best time to get prepared for your retirement. We all want to retire comfortably right?
Baby Step 5: Save money for your kids’ college fund
The early you can save money for your kids’ education the better. Nowadays kids can get loans but if you don’t want to burden them with school debts then it’s the best time to save towards that.
Baby Step 6: Pay off your home early
As your finances are looking up now, it’s time to think about your mortgage. A mortgage is one of those huge debts that keeps makes so many people stressed. As on baby step 2, you simply put any extra money towards paying your mortgage off.
Baby Step 7: Build wealth and give wealth
Now that everything is in order, you’ve paid off all your debts, saved money for an emergency, and your kids’ education, is now the time to build, give and enjoy your wealth. You are now ready and able to live how you want.
Are you ready to take control of your money? Let’s dive in!
1. You need an emergency fund
Having an emergency fund is one of Dave Ramsey’s baby steps as seen below. An emergency fund will prepare you for those unexpected life hard situations such as loss of job, car troubles and medical bills.
This doesn’t mean you can dig into it any time you need money on short notice. It has to be an emergency. There are so many legit ways you can make money fast like selling your items around your house that you no longer need or even taking surveys. An emergency fund acts as a cushion as you start your debt-free journey as it prevents any hindrances on your debt payoff process.
2. Have a plan
For you to be debt-free and to achieve your financial freedom, you need to set realistic goals. Have valid plans in place. Goals will keep you grounded and motivated. Most importantly remember to celebrate every milestone, whether small or big.
3. Cut your credit cards
Cutting your credit cards are one of Dave Ramsey tips that will save you so much money. With a credit card, we tend to keep shopping thinking that we have money and we can afford it. Credit card is money borrowed. Even though you get rewards do away with them. The truth is that no one got rich from credit card rewards.
Using credit cards are not entirely bad but you have to be wise on how to go about it. Only a very small percentage can do that as most people end up with forgotten bills and paying interest months down the line. Unless you are among the rare group that never miss any payment, it’s time to do away with your credit cards. If you have to use a credit card make sure to pay it back straight away to avoid high-interest fees.
4. Give up on expensive hobbies
Expensive hobbies will hurt your debt. If you are in debt, it’s time to ditch those expensive hobbies regardless of how hard it is. For example, if you have a gym subscription cancel it. There are so many works out exercises online and programs which are free or you could even go for a run in the park. If you still have magazine subscriptions, it’s time to let go. Nowadays you can get any information you want online.
There are so many hobbies you can take up that will indeed make you money. Hobbies such as pet sitting, photography, cooking and gaming.
5. Always have a shopping list
Have you ever realized that if you go shopping without a shopping list your bill always triples? A shopping list will keep you grounded as you won’t be doing any impulse buying. If you want to stop overspending and instead save more money make a list and stick to it.
6. Increase your income
Increasing your income is one of the must implement Dave Ramsey tips. You might be doing all the things you ought to but sometimes that still not enough for you to see such a difference. He is a big advocate for working more and smart to get out of debt which makes sense because the more money you have the quicker you will be debt-free.
There are so many ways to make extra money that are legitimate and don’t require you to slave yourself. Whether babysitting, walking dogs or selling the items you no longer need on places like craigslist, posh mark or car garage, the extra money will take you a step further. It will help you to stretch your budget farther. Simply identify a few ways you can increase your income and pursue them.
One of the best and most recommended way to make extra money is blogging. Some of the reasons I love blogging is freedom which means I can work from anywhere as long as I have a computer and good internet connection, flexibility as you get to be your boss and you choose the hours to works on your blog and of course the ability to make you money month after month with little to no effort. At first, you will be required to put in some work but you will enjoy the benefits.
From this income report of 19 super successful bloggers, you can see that making money online from blogging is possible and not at all complicated. Most of the bloggers in that list are making more than $2000 per month. Blogging can for sure help you make extra money that in return save or even use to pay your debt.
There are so many ways you can make money blogging such as creating courses and eBooks, having Ads, through sponsored posts, hosting giveaways and affiliate marketing. Blogging is not a get rich quick scheme, so much hard work goes behind the scene so don’t let all the income reports fool you. Wondering how to get start a profitable blog? Check out my step by step on how to start a profitable blog. The best part is that you don’t have to be tech-savvy to start one or head over to Bluehost and get set up for as little as $3.95/month.
Below are more side hustles that will help you make passive income and the best part most don’t require any prior experience.
7. Keep your current phone
Nowadays there is always a phone new in the market, but it doesn’t mean you have to upgrade every time. In most cases, there isn’t so much that has changed from your old phone. Chances are you paying someone a ridiculous amount for exactly what old your phone can do.
8. Always pay cash when possible
From following Dave Ramsey tips, I now use this analogy that if I can’t pay for it cash then I can’t afford it. For example, if I can’t afford to pay cash for a new phone or a TV means I cannot afford it. It doesn’t make sense getting into debt over such things. This is an exception to things like mortgages.
This is also a great way to avoid impulse buying. When you see something you want the best approach is to sleep on it. That gives you enough time to think about it and many are times you’ll find that you’ve changed your mind the next morning and you no longer want the item.
9. Choose your priorities
Knowing your priorities will help you spend money only on those things that are important. It’s not about how much money you make it’s about how much you spend. Spending more than you earn will lead to financial strain and eventually into serious debt. If you are always to keep up with the Joneses, that’s a habit you need to quit. With the era of influencers, who seem to always own designer items, travel to the most exotic places, dining in the 5-star restaurants it can be tempting to want to live the kind of life they are a priority. We always forget that some of these things are pr gifts. Companies pay them to advertise and create awareness around their items.
Dave Ramsey advises you live like no one else so later you can live like no one else. You sacrifice and pay off your debt now so you can enjoy your money later on. Live in your means and don’t spend more than you earn.
10. Dave Ramsey tips: Avoid brand names
We are in an era where buying brands is the in thing now. People want to be famous for owning designer things. The truth is a lot of off-brand items are equally good and they cost a fraction of what the brand items cost. It’s time to save yourself so much money by cutting down on branded goods.
11. Create a zero budget
Having a budget is one of the most important step to any financial freedom. It simply is the foundation for your money. A zero budget requires you to budget and account for every single dollar you are receiving each month. Your income minus expenses should equal zero. If after budgeting every dollar you still have expenses unaccounted for, it’s an indication that you need to further cut your expenses. Here are 21 easy ways to help you cut your expenses and save more money. With a budget, you will know what you can and can’t afford and it will tell you exactly where and how to spend your money. This will give you more control over how your money is being spent.
12. Cook your food.
Studies have shown that for most families their big expenses is food. Eating out is expensive. Start meal prepping your weekly meals, it will save you so much money. You will always have a healthy meal which means you won’t be tempted to go eat out or even order in.
Meal planning is a life saver. Saves you so much time and money. Knowing what you are going to eat before doing grocery shopping will save you money on your grocery budget. If you don’t know exactly what you need from the store you end up buying unnecessary things that ends up stale. With a meal plan, you won’t buy things you don’t need.
The best way to go about is through The 5 meal plan. I love 5 meal plan program which is perfect for anyone who wants to save time and money. You will get one week’s meal prep recipes and a curated shopping list. For just $5 a month they will send you weekly meal plans, costing less than $2 per person. They also offer special plans in case you are on any diet.
Sign up for $5 meal plan and get super cheap meal-prep recipes sent straight to your inbox every Friday.
Related post: 18 Realistic and simple ways to save money on groceries.
13. Unsubscribe from brands and store newsletters
The reason why some people are in debt is newsletters. Companies do a great job of sending out discounts and deal alerts which sometimes are so tempting to miss out on them. Are you one of those people who spend because they don’t want to miss out on the deal? Go through all your subscriptions and cancel them.
You also need to cancel any automatic subscription you might have. Things like gym memberships and magazine subscriptions that you never make use of.
14. Ask your boss for a raise
So many people miss out on this because they never ask for one as they are afraid of getting a no. In reality, if you never ask, you really never know what your boss’s response is and if it’s a NO, sometimes that’s what we need as a wake up call to motivate us to work hard.
15. Use the cash envelope system
The cash envelope system is a great way to have control of your money. This helps you to keep track of your spending and makes sticking to a budget easier. The cash envelope system is simply creating a budget and using different envelopes to keep your money for things such as groceries, rent and other utility bills. I love these systems because it makes sure that every dollar in my budget is accounted for.
You simply take the money allocated to each category of spending and organize it into envelopes. For this method to work you have to use the money from the assigned envelopes only. It’s all about discipline. You will notice with time that you will end up saving more money using cash only compared to credit cards because with cash we tend to analyze every purchase differently. Spend only cash and once you are out of cash for a category wait for next month.
It might be very hard to implement all of Dave Ramsey tips but you can modify some of his tips to what works for you and your family as long as you are making progress that all that counts. One of the best and most helpful ways to stay on track with his methods was through his workbook. We are human and sometimes we forget a significant amount of what we read. It’s super helpful to write budgets while learning and implementing.
There you have it, Dave Ramsey tips that are realistic and will help you save money this money and become debt-free. We can all agree there is no better way to learn than from the financial guru himself. Someone who has successfully become debt-free. His advice is brilliant. So many people all over the world have used his advice and they have been able to save money, make money, manage money and be debt-free. If you want to reach your financial goals don’t take advice from broke people.
Looking for ways to accelerate your path to achieving your financial goals, Dave Ramsey is the best place to start. 15 amazing Dave Ramsey tips to help you save money and become debt free.