The Total Money Makeover:Classic Edition Review

Debt is an ugly thing that most people like to keep swept under the rug where it is nice and hidden from the neighbors. What many of us don’t realize is that the neighbors have debt too.  In fact, the majority of Americans have some form of debt.  It’s the norm of our consumerist society.

My husband and I have been in debt for years.  It’s an embarrassing confession, but a truthful one.  We each made irresponsible decisions when we were younger, we mismanaged money, and we got in over our heads.  We have slowly been paying things off over the last several years, penny by penny, but sometimes it takes so long to make real progress that we get discouraged.

A friend of mine once told me about Dave Ramsey’s The Total Money Makeover, but I had never actually picked it up to read for myself.  I listened to him occasionally on the radio and I knew some basics (Debt Snowball, Emergency Fund, etc.), but I had always been curious to get a better understanding of his plan and how it works.

Now that I’ve read this book, I can see why so many people rave about it and the principles taught within its covers.  It is common sense in a book jacket, given in a straight forward, no holds barred way.  Dave Ramsey will step on your toes, but if you’ve made poor financial decisions, that may be just what you need in order to convince you to get yourself in gear and pull yourself out of debt!

The book first dispels many common money myths such as debt is a necessary part of adult life or a tool for building credit. Then it moves into explaining many money myths as well (retirement will be worked out, even if you aren’t saving now).  Finally Dave moves into explaining in detail the seven Baby Steps he recommends taking to rid yourself of debt and provide yourself with a debt free future.

The Baby Steps are:

  1. Save $1000 fast
  2. The Debt Snowball
  3. Finish the Emergency Fund
  4. Maximize Retirement Investing
  5. College Funding
  6. Pay Off the Home Mortgage
  7. Build Wealth like Crazy
I really enjoyed Dave’s no nonsense, but friendly approach.  Sometimes you need someone to tell you like it is, without dressing it up in frills and bows.  I liked the in depth explanations of each step, including descriptions of why it is so important to do them in this order and not to try to do several of them at once.
My absolute favorite part of the book is that he explains how this system can work for people (like us!) who do no have a fixed income.  I’ve spoken to several people over the years who don’t understand what it’s like to have an irregular income that just knew they could “fix” our debt with their advice.  The suggestions given weren’t bad or wrong, but they all lived on salaries.  When you aren’t sure the amount of income you are going to bring in at any given time, it’s not as simple to sit down and have a strict budget.  You can have a general idea, but things change–sometimes unexpectedly and fast–which can leave you completely unprepared for emergencies.  The Total Money Makeover takes this type of income into account and has a special way to set up your finances that works when you have irregularity in your paycheck. 
We have decided to attempt our own Total Money Makeover after reading this book.  While we have made great strides on our own to pay down our debt, we would love to find a way to do it faster so that we can live our lives without the burden of financial stress sooner and also to pass on a debt free legacy to our children.  I’d recommend this book to anyone who is deep in debt, only moderately in debt, or even to people who have no debt(you want to stay that way, right?). 
What are your strategies for dealing with debt? 

Comments

  1. Hey, great post! I’m so glad you found his book. I read the book last year, but it didn’t really hit home until I read it a second time in August. So far I have paid off 5 of 13 bills, which is an awesome feeling! I’ve also been blogging about it all. It is a great way to hold myself accountable. Feel free to check it out sometime and leave some comments! I love hearing about other peoples journeys to becoming debt free! http://takingkarayourself.blogspot.com/

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