A few months ago I attended a couple of lunch seminars by Dave Ramsey, author of The Total Money Makeover. He outlined a few tips to becoming debt-free. I can’t say that what I heard was anything I didn’t already know, but it was, at the very least, incredibly challenging. Here are a few highlights:
1 – Live within your means (set up a budget & stick to it)
2 – Save money for emergencies (most people recommend 6-12 month’s salary equivalent)
3 – Commit to not incurring more debt (Dave recommends cutting up your credit cards)
He continued with more tips on paying off consumer debt, mortgages, etc. You can find a lot more of Dave’s tips and resources on his website. You’ll find a short video below, as well.
As I look back on the seminars, what really stands out to me is the goal for getting out of debt. It isn’t just to be free of debt, though not having the chains of debt dragging us down is incredibly freeing, it’s really a necessity. If we truly want to be stewards who are rich towards God and His kingdom living debt free will allow us to seize giving opportunities as they arise, and instead of paying interest we can make deposits for eternity.
I don’t think I’m ready to cut up my credit cards just yet, but I am committed to living within my means and paying off the balance each month.
Question: What are you changing this year to be debt free?
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Renae Nanney
Keynote Development Team Coordinator
{ 8 comments… read them below or add one }
For me, the challenge right now is to stay debt free. We have a minivan that will need to be replaced in the next couple of years and I’m realizing that I’m going to have to get much more aggresive in saving for the replacement so I can aviod a car loan. My wife and I both brought car payments into our marriage 17 years ago but after paying those off, we’ve been able to pay cash for all of our “new to us” (i.e. used!) cars since then.
One interesting idea is to think of things you want to buy or things you want and then just wait and put them on your Christmas or birthday lists for presents. This delays the instant gratification of impulse buying and you can create a Christmas list or birthday list all year long. My wife and I are debt free now but we might be looking into buying a home soon and then we will have that mortgage thing to pay for. I use my credit card but pay it off every month and earn 1% interest on all I buy. Anywaz that’s my two cents.
Great input, guys. The concept of not buying big ticket items with cash is definitely foreign in our society, but worth thinking about. Delayed gratification is another missed concept for many of us, especially in America. Why shouldn’t I have it now? Patience, waiting, saving for something…good stuff.
Thanks for the simple reminder.
Everywhere I read and look I keep hearing about Dave Ramsey and wise tips on the importance of being debt free. Hmmmm… Maybe the Holy Spirit is trying to say something? May we and our finances be in God’s hands and may He have the freedom to change us and/or our habits as He desires…
Kim, there are some great videos on Dave Ramsey’s website. You can link there from the post. Also, check out http://www.lifewidget.com for other cool resources on various areas, including finances. Thanks for your thoughts! Good stuff!
Dave Ramsey’s three main points were simple, but very true.
After we were married in 2006, we hammered our car debt and school loan debt. Praise God, we’ve been debt free since the summer of 2008! To continue to be debt free, we have a cash budget and stick to it. A big thing, though is to continually make the decision to not pick up those things at the store that are necessary but not necessary yet…and making sure we’ve saved for them and not justified putting them on our credit card because we need them.