# Dave Ramsey



## proudwidaddy (Dec 26, 2011)

Has anyone tried Dave Ramsey's program for money management? I've accumulated quite a lot of debt with starting over from the divorce with buying things for kids. I need help. Wondering if his program works.


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## Pbartender (Dec 6, 2012)

I can go into more detail later, but yes... While I don't agree with all his investment advice, his basic "snowball" plan for getting out of debt is sound.

Now that I'm divorced, without my ex-wife working against me, I will be completely debt free within 3 years, using his basic plan with a minor modification or two.


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## FormerSelf (Apr 21, 2013)

I highly recommend it...it is very basic and simple...and will help you box yourself out of the corner if debt is really taking up a major chunk of your pay.

I saved up the emergency fund and started paying off smallest bills...paid off a couple. Wasn't making much headway, so we targeted my car...and finished it off with tax return...and after we did that...it gave us room to start actually having a "snowball" that was effective. Still, none of it will work if you aren't committed to making that budget. Of course, now that I got multiple myeloma, it's all blown to hades, so we're having to go bankrupt anyway...but still, it feels good to pay things off.


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## Paradise (Dec 16, 2011)

proudwidaddy said:


> Has anyone tried Dave Ramsey's program for money management? I've accumulated quite a lot of debt with starting over from the divorce with buying things for kids. I need help. Wondering if his program works.


Proud, 

I have read all of Ramsey's books and they are a great place to start. Been budgeting pretty hardcore for the last year or so and it is probably just about the only thing that saved me since I decided to take a pay cut this past year to spend more time with my kiddo. I spent two months tracking EVERY penny that I spent and earned. It was very hard at first. I also started having one "no spend" day a week and now I sometimes have two or three of them a week. It's amazing how much money can be squeezed out of a budget. 

Another thing I do is read financial blogs quite a bit. I have my two or three that I really like because they motivate me to stay on track. I'm sure you are like me and the debt is absolutely debilitating. I've never had credit card debt before my marriage and was within a month or two of considering bankruptcy so I was literally about ready to fall off of that cliff. Things are looking much better now. 

PM me if you want some good blogs to look at. Of course, you can just google them as well.


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## Clawed (May 21, 2013)

proudwidaddy said:


> Has anyone tried Dave Ramsey's program for money management? I've accumulated quite a lot of debt with starting over from the divorce with buying things for kids. I need help. Wondering if his program works.


Let me put this simply - if it were not for Dave Ramsey, I would be in debt to my eyeballs, and my divorce would have been extremely messy. But, because we paid off all of our debt, including our two cars, it was the most painless divorce possible because we had NO liabilites and we both walked away with cash from the sale of our home. 

Amazing stuff - very simple principles, very sound. You'll regret you didn't do it sooner! Good luck, friend ~

Oh, and lest I forget: *I'M DEBT FREE!!!!!*


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## Pbartender (Dec 6, 2012)

For those, who aren't familiar, here's the Cliff's Notes version of his debt elimination strategy...


*Create Emergency Fund* By any means, stash away $1,000. You do this, so that if an emergency happens you don't have to use debt to cover it. If at any time you are required to use some or all of these funds, pause the plan and rebuild the $1,000.
*Debt Snowball* You begin paying off debts, by paying only the minimum payment on all of them, except the one with the smallest balance. Any extra money you have should be used, to pay it off as soon as possible. When the debt is paid off, you add the money from that debt's payments to the payments of the next largest debt, and continue until all are paid off.*
*Increase Emergency Fund* Increase the emergency savings, until it's equal to 3-6 months worth of bills and expenses. This practically eliminates the need to use debt or credit for emergencies and large purchases.
*Start Investing* Invest 15% in retirement accounts or mutual funds... Use your money to make money.
*College Fund* If necessary, start saving for your children's college. To help them stay out of debt, too.
*Eliminate Mortgage* If necessary, make extra payments to pay off your mortgage early.
*Profit!* No debt. No mortgage. Kids are set for college. Enough emergency money saved to last out several months of no income. Continue investing, and use some of your money for fun.

*There is some controversy over this strategy amongst financial experts... The "snowball" method is not necessarily the quickest or most efficient way of paying off debts. Ramsey recommends it on "psychological" grounds. The idea is that working on the smallest first allows to eliminate one of your debts quickly, and the morale boost of paying off a debt, even a small one, provides encouragement to continue.


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## brokenbythis (Aug 21, 2011)

What works for me is:

* DO NOT BUY ANYTHING YOU CANNOT PAY CASH FOR
* Do not use credit cards or take loans.
* Create a realistic budget ie: a budget that includes everything you could anticipate you and your kids will need.
* Get a better job or a second job to live within your realistic budget and save what's leftover (emergency fund).

Believe me, it works.

I am a divorced mom of a special needs child. My salary is nothing to get excited about, mainly because I only went back to work 18 mths ago after being a stay at home mom for 8 yrs. I have enrolled back into school and start in January - I am getting my employer to pay for that through their tuition assistance program = zero college debt for me. I am slated for promotion mid next year with a substantial pay raise. While I do get alimony and child support my total income is not 6 figures. And I live in an expensive part of the city - only for the best schools for my child.

I do not waste money, food or stuff, I don't shop for crap I don't need. I don't have high level cable or an iphone. I actually have a $40 android phone on a no contract pay as you go plan for $35 a month. I cook at home 6 days and nights a week, take my lunch to work 4 days a week. Stopped going to Starbucks 5 times a week, now only go once  ... the complete absence of STRESS due to money problems has made my life so much happier. 

I started doing job research for people a few hours a few nights a week, at $20 an hour. Brings me over $500 a month extra income, after tax. It allows me to live within my means and provide for everything my son and I need.

Hope this helps...


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## brokenbythis (Aug 21, 2011)

PS: I also do not use my debt card I use CASH. Opening your wallet and seeing the actual cash come out makes you think twice 

My car is 5 years old and paid off. Its a Toyota and I keep it serviced on schedule so I should get another 7 yrs or so out of it no problems.

I have a budget I have forecasted out 2 years to 2016. Its an Excel spreadsheet. It has bi-weekly budgets (I get paid bi-weekly), by date and I stick to it religiously.


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## JohnSmithh (Feb 5, 2013)

proudwidaddy said:


> Has anyone tried Dave Ramsey's program for money management? I've accumulated quite a lot of debt with starting over from the divorce with buying things for kids. I need help. Wondering if his program works.


It's a great system if you can stick to it. Easy to follow.


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