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Learn how to manage your money with Dave Ramsey's proven plan of seven steps to ditch debt, save, invest and give. Find out your debt-free date, net worth, budget and more with free tools and resources.
- Save $1,000 for your starter emergency fund.
- Pay off all debt (except the house) using the debt snowball.
- Save 3–6 months of expenses in a fully funded emergency fund.
- Invest 15% of your household income in retirement.
- 9 min
- Save $1,000 for Your Starter Emergency Fund. Only 32% of Americans say they can pay cash for a $400 emergency.That means 68% of them are borrowing, selling or going into debt when life happens.
- Pay Off All Debt (Except the House) Using the Debt Snowball. Debt’s good for one thing and one thing only: holding you back. But you don’t want to be held back.
- Save 3–6 Months of Expenses in a Fully Funded Emergency Fund. The debt is gone. Goodbye, debt. Talk to you never. Now, you’re going to build up that emergency savings fund so it’s strong enough to stand up to bigger problems, like job loss.
- Invest 15% of Your Household Income in Retirement. For some people, retirement can seem like tomorrow’s problem. But that kind of thinking will leave you working for the rest of your life.
- Save $1,000 for Your Starter Emergency Fund. In this first step, your goal is to save $1,000 as fast as you can. Your emergency fund will cover those unexpected life events you can't plan for.
- Pay Off All Debt (Except the House) Using the Debt Snowball. Next, it’s time to pay off the cars, the credit cards, and your student loans.
- Save 3–6 Months of Expenses in a Fully Funded Emergency Fund. You’ve paid off your debt! Don’t slow down now. Take that money you were throwing at your debt and build a fully funded emergency fund that covers 3–6 months of your expenses.
- Invest 15% of Your Household Income in Retirement. It's time to get serious about retirement—no matter your age. Take 15% of your gross household income and start investing it into your retirement.
Ramsey+ helps you follow the Baby Steps, a proven plan to get out of debt and build wealth. With Ramsey+, you can see your debt-free date, get coaching, access courses, and connect with others.
Indeed, the baby steps act as a fantastic approach in many regards to becoming independent of credit card and other debt. But there's more to know about Dave Ramsey's approach and some of his...
