Monday, November 15, 2010

Book Review: Financial Peace, Revisited

This morning I read a news article that says that Colorado residents carry "an average of $8,700 in credit card debt. They are startling numbers that put Colorado second in the nation for credit card debt per person" (source). These numbers are terrifying, and when the Chef and I got married, we also struggled with debt, specifically racked up by my poor budgeting in college and later wedding expenses.

We read a lot of books and joined a Crown Financial Ministries class at our church to help us create a budget and live within our means. One of the books that we read while in this class was Dave Ramsey's Total Money Makeover. Wow... it changed our perspectives completely.

Almost four years later, I just finished reading another Dave Ramsey book, which inspired me to want to read one financial planning book every month, or at least every six weeks. Whenever I complete one of these books, I feel motivated and inspired to keep a budget, to pay off debt, and to be able to say "no" to those little purchases that keep sucking money out of our checking account.

Last weekend I finished Financial Peace Revisited, by Dave Ramsey. This book was Money Makeover so much of this book was the same material, and I just needed to review it. The Chef and I implemented Ramsey's Baby Steps to Financial Peace over a year ago, and we're slowly slogging away to financial freedom.

Dave Ramsey's Baby Step #1: Save $1000 for an Emergency Fund
   Having this emergency fund has helped us so many times, and I highly recommend having an emergency fund at all times! Not just for a rainy day fund, but for family emergencies, bad plumbing, and the always terrifying car mechanical issues that seem to hit at the worst times of the month-- having an emergency fund is essential.
Baby Step #2 Pay off all debt using the Debt Snowball method
   While we've paid off all of our credit card debt, we still have car and student loans to pay off. Ramsey's debt snowball plan alone is worth reading the book, as it really gets you excited about paying off debt and becoming financially free. Our whole snowball plan was derailed when the Chef's car broke last year and we had to replace it, and then five months later when my recently paid off car was totalled and we had to replace it. Despite that, we're on a mission to be debt free-- read this book and see how!
Baby Step #3 Have 3 to 6 Months of Living Expenses in Savings...
   Hopefully we'll be able to get all of our debt paid off and start this Baby Step soon, and be able to move on to the rest at some point.
I'm excited about budgeting, finances, and living within our means (today). Next month I'll probably have to read another financial book to kick start my budgeting juices again, but I'll give this book five stars, trust me, you won't regret reading it.

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