Saturday, May 23, 2015

Paying Off Debt with Dave Ramsey

I have really been thinking about money lately. And more specifically about student debt and the ability to pay it off. I don't want to be the person that is 40 years old with the student debt created in their teens and early twenties still lingering around. The thought of having any debt is pretty depressing and I just want to get rid of it ASAP!

Well to accomplish this goal, I have been researching and have come across the Dave Ramsey method for financial management: http://www.daveramsey.com/. He recommends using a specific plan to financial freedom. He first specifies getting all of your debts into current status (if you have any late payments then we just want to pay anything past due). Then setting up a $1,000 emergency fund and attacking debt using the debt snowball. 

The debt snowball plan is to line up all debts in order of size and begin making minimum payments on all but the smallest debt. Then you will put any extra income towards that small debt until it is paid off. Then you begin the same process with the next smallest debt. And it continues until you are debt free! 

The idea behind paying off the smallest debt first is that you begin seeing the traction and get even more passionate about getting rid of it.

I am working on this now and I am so excited to begin working getting rid of debt under this plan. 

Here's a video highlighting the plan: 



Wish me luck! 

Jess

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