Book Review: The Total Money Makeover

I just finished reading The Total Money Makeover: A Proven Plan for Financial Fitness, by Dave Ramsey. Ramsey is a well-known financial planner, who broadcasts his financial advice to millions each week on his radio program, The Dave Ramsey Show. His hook sounds something like this: “If you're making payments on your car, your furniture, your house and your credit cards, you're a typical American...and you're in trouble. If you're behind on your payments and see no earthly way to dig your way out of your miserable pit. You need help.” If you've never heard Dave on the radio or read his works, be prepared for his direct talk. He doesn't sugar coat his advice. He'll tell you what's smart and what's stupid. He won't tell you that the road out of debt is always easy. Read his book and you'll know very clearly where he stands. Ramsey gives a step-by-step approach to getting out of debt, saving and investing for the future. I have always gained something from Dave Ramsey’s books, and this one is no exception. Dave very clearly outlines a financial plan that is worth consideration. It can be summarized into five steps: Step 1: Save $1,000 as a Starter Emergency Fund. Add to it when possible to have 3-six months living expenses as your emergency fund. Step 2: Get rid of debt. Start the Debt Snowball until only mortgage remains. Step 3: Invest 15% of your Gross Income for Retirement (401K, Roth, and Traditional IRA). Step 4: Payoff Home Mortgage. Step 5: Save, save, save Do it and your financial life will be healthier!