‘The Total Money Makeover’
Fri 26 February 2010
, Alberta Opoku, Leap
There are hundreds of thousands of books about money: from making it to losing it. Some are entertaining, and others inspiring. Dave Ramsey’s The total money makeover is both.
“Wealth building isn’t rocket science, which is a good thing for me (and probably you). Winning at money is 80 percent behavior and 20 percent head knowledge. What to do isn’t the problem: doing it is”, Dave Ramsey says in the beginning of The Total Money Makeover: A Proven Plan for Financial Fitness.
Seven Baby Steps
This book speaks to everyone, from financial disasters to people who want to build wealth slowly. First the radio talk-show host and bestselling author gives seven baby steps, which are designed to build on each other. The first: start a $ 1000 Emergency Fund. Secondly, pay off all debt using the Debt Snowball. Thirdly, build your Full Emergency Fund using 3 to 6 months of expenses in savings.
Steps four through seven are about building wealth: invest 15 percent of your household income into your pre-tax retirement; invest in your child’s college fund; pay off your home early and finally: save for future generations and share your wealth with others.
No credit cards?
One of the reasons why I like this book is because Ramsey appreciates how hard it is to put the Baby Steps into action. So he has seasoned the book with testimonials from ordinary people who’ve effectively used the system and have become debt free. Once you’re out of debt, Ramsey advices to stay away from debt altogether by not having credit cards. Not everyone would agree about that, though. Another thing I’m not too sure about is his advice to couples to not have separate checking accounts. But that doesn’t do away with the fact that The total money makeover is a great and effective personal finance tool.
Check out the ‘Seven Baby Steps’ in detail here.
Author: Dave Ramsey
Title: The Total Money Makeover: A Proven Plan for Financial Fitness
Hardcover: 224 pagesPublisher: Thomas Nelson