Wholeness Healing Center

Financial Woes?

As I write this it is one of the coldest days yet that we have been blessed with this winter. But it is past mid February and so it is a count-down towards spring, which certainly keeps our spirits going as we look forward to the sun and warmth. Often times January and February are the months that we find ourselves regrouping and looking at our finances after the Christmas spending spree bills have started to come in and we are attempting to pay them.

So, I thought it might be timely to talk about a book that I often refer clients to read, The Total Money Makeover by Dave Ramsey. Ramsey’s approach towards financial difficulties is simple and straightforward, yet empowers people to get their spending back under-control and find financial freedom.

If you are experiencing the dread of getting your mail, paying your bills, coming up short each month, fighting with your spouse, having too little savings, or as Ramsey says “sitting with too much month left at the end of the money”, then it might be time to make some changes in your life, your lifestyle, and your thinking about money.

Ramsey believes that winning at money is 80% behavior and 20% head knowledge. He is quick to remind readers that they are the problem with their money and they are the ones who can put it back in order. He acknowledges that his approach is not easy, but it will work. His basic motto is “If you will live like no one else, later you can live like no one else”. This means that you make the sacrifices now that most people won’t make and later you will live like no one else lives.

First, he suggests that we must change our view of debt. 75% of the Forbes 400 surveyed said that the best way to build wealth is to become and stay debt-free. (Ramsey, 2003 pg. 23). So let’s look at how we can do this through Ramsey’s strategies.

He talks about taking baby-steps as the way to eat an elephant is one bite at a time. So before you get overwhelmed and wonder how you can ever be out of debt, consider that you have to start somewhere.

Ramsey advises that you set up a written budget and to do this every month. Before the month has started, spend every dollar on paper. This means you have allotted all your money before the income is in your hand. All your bills need to be current before you start on the plan, so this will become the first priority for your budget. Then he has you “snowball” your debt. And although the process is not complicated, it is difficult to follow through on this as it is a financial “diet”.

Snowballing your debts means that you list your debts in order with the smallest debt first. This will be how you will start paying off your bills. Paying the smallest debt off allows you to have reinforcement, the reaching of a small goal towards financial freedom. It will keep you going. You make minimum payments on all your other debt. Then every dollar you can find from anywhere in your budget goes toward the smallest debt until it is paid. When you have paid off the smallest bill, you take that payment and add it to the next bill and snowball the payments with the focus on the second bill. As you pay off the bills, you will have more money to add to the next debt on the list, enabling you to pay off these bills more quickly.

Of course, this is only part of what Ramsey advocates you do. He suggests that you sell things to pay off debt and that you eventually get to the point that you only pay for anything you purchase in cash. He wants you to have a second and third job to pay off these bills so that you can quickly begin to pay off your debt especially if right now you can barely make the minimum payments in your budget.

I have only touched on some of the meat of Ramsey’s program. What I like about it is that he gives the readers hope that they can be financially free and empowers all to take responsibility for their financial woes by encouraging the readers to roll up their sleeves and get to work!

Tags: Dave Ramsey, getting out of debt, holiday debt, holiday hangover