This week marks an important event for us: we completed our Baby Step #1, and we have Dave Ramsey to thank for it! I wrote about Starting Our Debt Journey back in January, and since then we’ve saved $1,000 and started our emergency fund. Two months after making the decision to start our journey towards being debt-free we are finally starting to attack our credit cards at a vigorous pace.
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We were first introduced to Dave Ramsey through his podcasts. Danny and I blew through those podcasts when I accompanied him on his deliveries throughout Brooklyn. We felt so excited listening to him and hearing everybody call in to do their debt free screams. I love his Millionaire Theme Hours, which is when people call in and talk about how they built their wealth.
One of the most important lessons I learned from listening to those callers was the fact that it doesn’t take having debt to build wealth. Last year I was almost convinced I needed to get into debt to build my business with an MLM company I was a distributor for. My upline persuaded most of us to use credit cards to make purchases for stock if we didn’t have cash to upfront the costs. I discovered Dave Ramsey around the same time I joined as a distributor so thankfully I did not fall for that credit card trap.
Click here to read my post about Why I regret being a SeneGence Distributor. It’s one of my most popular posts on Diana Met Danny!
What are Dave Ramsey’s Baby Steps?
Dave Ramsey’s Baby Steps consists of paying off debt and then building wealth. There are seven parts to his plan, and we are currently on step #2. If you’d like to read up on Dave Ramsey’s Baby Steps, click here to read his in-depth article on the 7 Baby Steps.
Now that we’ve completed Baby Step #1 and saved $1,000 Danny and I feel so much better knowing that we are in control of our finances. We were able to complete this step in two months after budgeting carefully and watching our spending. We still have areas in which we need to improve on, but we feel pretty proud of how far we’ve come in these last sixty days.
We want to be debt-free this year
Our goal is to pay off all our debt before we move this summer. It will be so nice to move to a new place and have a fresh start. We want to start over with no debt and fewer payments hanging over our head. We have so many plans for our future and they won’t be possible to accomplish with debt.
Being debt-free is not an easy feat
I never realized what I thought about credit cards until I read Dave Ramsey’s Total Money Makeover. We are so conditioned to believe that we need credit cards that it just seems like a normal part of life.
Danny purchased this book for us last Christmas and we started reading it together the same night. This book really challenged our views on credit cards and debt, and we no longer view a FICO score as a necessary tool to live.
Danny and I both believed that we needed to build a good FICO score in order to take a loan out to purchase a house one day. We’ve thrown around the idea of paying for a house in full or at least save up for a huge down payment on a house since reading the Total Money Makeover.
Small victories over interest rates
His debt repayment does goes a bit against the grain because it ignores interest rates and focuses on reaching small victories instead.
That part of his Debt Snowball plan was a bit hard for me to accept as well. I thought that it didn’t make sense to ignore interest rates, but it truly does matter, at least for me it does. I feel more motivated to pursue a debt-free me now that I’m knocking small debts out to tackle the large ones.
I don’t think Dave Ramsey’s plan is the only to pay off debt and build wealth but it has surely helped us. When it comes down to it, you have to do what’s best for you and your family.
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So, what are you waiting for?
I know that I mentioned the Total Money Makeover a lot in this blog post, but that’s because of how much I love the information in this important resource. I truly believe this book will benefit your life so much, just as much as it’s blessed ours.
If you have debt to pay off I encourage you to browse through Dave Ramsey’s site first before purchasing the Total Money Makeover. Listen to his podcasts, you can find them free on the internet. He is brilliant and you can find great information on the internet and in his podcasts for FREE. I just like having the book because it’s a great resource I can flip through whenever I want.
It is possible to live debt-free
It is totally possible to pay for everything we want without credit cards. Sure, it might take a longer time to save up for things we want but we just have to make do with the things we have until then. I also have my husband to thank for taking such an active role in paying off our debt.
Working together on this plan brings us closer together, surprisingly. It’s not fun working on our budget every month but we’ve been able to get on the same page and learn more about how we communicate with each other.
Knowing that we have each other to count is such a blessing, and we are so excited to finally reach our debt-free goal this summer!
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