Debt Free Destiny

Review of well-known radio and tv host Dave Ramsey’s Baby Steps - part of the Financial Peace program.

Today there are literally millions of Americans who have found themselves deep in debt, and although getting in debt is very easy, getting out of debt can be another story.

In fact, to some people, becoming debt free looks like something that is totally impossible. Sure, there are plenty of different methods of getting out of debt available; however, not all are suitable for your needs.

However, Dave Ramsey’s “Baby Steps” offer a very straightforward and simple way to get out of debt. So, let’s take a closer look at the baby steps and the man behind them.

 

The Man Behind the Program

Dave Ramsey, the man who created the Financial Peace books, course and program, is a man who truly knows what it is like to deal with financial difficulties. In fact, at one point in his life, he found himself over his head in debt and lost virtually everything.

However, today he has learned many important lessons that have helped to get him debt free and to a place in his life where he is successful and financially secure. He is an author of several financial books and he also hosts popular national radio and tv shows.

With his experience, he definitely has a lot to offer, and he takes his experiences and the lessons he has learned and incorporates them into the “Baby Steps” program.

Is Financial Peace and the Baby Steps A Quality Program?

So, you may be wondering if this program is a quality one that is better than all the other debt solutions out there on the market. The answer to your question is yes. This is a program that is realistic and helpful, and no matter how much you research and consider a variety of other fix it plans for your finances, you probably won’t find a better plan.

Of course in the end you’ll have to make this decision on your own, but take some time to listen to the radio shows by Dave Ramsey, and no doubt you’ll be impressed, especially each time you hear a success story about this plan.

Dave Ramsey’s Baby Steps

So, let’s take a closer look at the Baby Steps that are given by Dave Ramsey in Financial Peace. They are fairly common sence, but the genius is in their practicality and order. Lots of people know they should be doing most of these things, but “when?” and “how much?”. The baby steps answer these questions.

• Step 1. Accumulate $1000 in Emergency Cash – Ramsey points out that you always need to have some cash in a savings account to fall back on if you want to get out of debt. Just paying the minimum payments for awhile is a great idea. It is important that you have this emergency fund to help if you really need it.
• Step 2 Start Paying Off Debts, Starting with the Smallest Ones – This step teaches you to take inventory of all your bills, and then start with the smallest and start paying off your debts using the debt snowball method.
• Step 3 – Save 3-6 Months in an Emergency Fund – You never know what can happen in life, so once you have effectively dealt with debt, putting together an emergency fund can help you prepare for those bad times in life. Work to get enough money in the fund to pay for the cost of living for about 3-6 months.
• Step 4 - Invest 15% of Your Income - Retirement will come sooner than you think so you shouldn’t wait any longer to start investing in a Roth IRA and pre-tax investments.
• Step 5 - Start a College Fund - If you have kids that are going to college (all kids should) start saving after you’re putting 15% percent into retirement.
• Step 6 - Pay off Your Mortgage - The interest is costing you dearly every month, so pay it off and don’t worry about losing the mortgage interest tax deduction. Why pay $1 in interest to save 28 cents in taxes?
• Step 7 - Invest More and Give Money Away to Worthy Causes. When you’re at this point, you can afford to diversify your invesments a little more and give money away to worthy causes.

Download the baby steps PDF file

Part of Dave’s Financial Peace Program, the baby steps are practical and easy to follow. Not only is this a plan designed to help you get out of debt, but it is also a plan that can help you begin to create wealth as well, in the long run.

So, consider getting started with this plan yourself to effectively get rid of debt and begin on your way to a “debt free destiny”.