The Handbook of Financial Peace University -Dave Ramsey
All his books practically gives the same message Earn, Spend, Save and Give.
The words of wisdom from the book are:
That’s because money is not just about math; it’s about behavior. Personal finance is only 20 percent head knowledge. The other 80 percent—the bulk of the issue—is behavior. And it’s our behaviors with money that can get us into the biggest trouble or lead us into the biggest successes.
Baby Step 1: Put $1,000 in a beginner emergency fund ($500 if your income is under $20,000 per year).
Baby Step 2: Pay off all debt using the debt snowball.
Baby Step 3: Put three to six months of expenses into savings as a full emergency fund.
Baby Step 4: Invest 15 percent of your household income into Roth IRAs and pretax retirement plans.
Baby Step 5: Begin college funding for your kids.
Baby Step 6: Pay off your home early.
Baby Step 7: Build wealth and give.
The Baby Steps work because of focus and priority. It’s like eating an elephant; you can’t do it all in one bite! But if you break it down into smaller steps and pour all of your attention, energy, and passion into one thing at a time, you can do anything.
Discipline is hard, it hurts, and it requires sacrifice. Personally, I don’t like discipline—but I love what discipline produces. When I’m disciplined with my diet and exercise, my body feels better.
A biblical principle: “No discipline seems pleasant at the time, but painful. Later on, however, it produces a harvest of righteousness and peace for those who have been trained by it.”
“If you will live like no one else, later you can live like no one else.” If you make some sacrifices, inject some discipline, and get intentional about winning with money, the future is wide open.
You may be surprised to learn that the brain is designed to do extraordinary mental calculations.
There are four major issues have a much higher probability of a successful marriage. Those four things are religion (shared household faith), in-laws (boundaries, influence, etc.), parenting, and money. If you keep these four pillars standing strong in your marriage, you’ll have a leg up on most of the couples you know.
I’ve heard him say men usually speak about 10,000–20,000 words a day, while women speak 30,000–50,000 words per day—with gusts up to 125,000! That’s why a lot of guys come home from a busy day at work, hit the sofa, and don’t say a word. They can’t. They’ve already used up their quota.
- Men love to share facts; women love to express feelings.
- Men connect by doing things; women connect by talking.
- Men tend to compete; women tend to cooperate.
- Men tend to be controlling; women tend to be agreeable.
- Men tend to be independent; women tend to be interdependent.
Every marriage has a Nerd, Free Spirit, Spender, and Saver. Mix all this together, and it’s really no surprise that money fights so often end in divorce.
There are four main areas of money that children need to learn: Work.
1. Money comes from work, not from other people, the government, or dumb luck. From an early age, your kids need to feel that emotional connection between work and money.
- Save. Teach your kids early on how to save up for purchases. If they learn how (and why) to save up for a Barbie today, they’ll know how (and why) to save up for a car or house tomorrow—with no debt.
- Spend. Let your kids have some fun with their money and experience the awesome feeling of buying something they want with money they saved. If you keep it all in the piggy bank and never let them enjoy it, they’ll either grow up into miserable old misers or they’ll rebel and become crazy, debt-ridden spenders once they hit college!
4. Give. Giving is the most fun you can have with your money.
Some pain is good! It helps; it instructs; it directs. A pain-free life is a life without victory, risks, or hard-learned lessons that really make a man grow up.
They describe boundaries this way: “Just as homeowners set physical property lines around their land, we need to set mental, physical, emotional, [I’ll add financial], and spiritual boundaries for our lives to help us distinguish what is our responsibility and what isn’t.”
Reflect on this statement: “How you spend your money tells me who you are and what is important to you.”
Zig Ziglar says, “If you aim at nothing, you’ll hit it every time.”
Budgeting is all about changing your behaviors with money, and behavior change takes time. Give yourself—and your spouse—some room to grow here, and do not expect an overnight miracle.
Think of it as the four walls that hold your house together. They are food, shelter, clothing, and transportation. If you have food in your belly, a roof over your head, clothes on your back, and a way to get to work tomorrow, you’ll live to fight another day.
“There’s a great place to go when you’re broke: to work!”
Money can buy fun, but it can’t buy happiness.
Mark Twain said it: “The secret of success is making your vocation a vacation.”
A job gives you a paycheck; a career gives you a direction and a purpose for your work. With a career in mind, identify the target.
So instead of just saying, “I need a job,” try starting off with, “I need a career.”
If you really want to live like no one else later, you may have to work like no one else today.
Location is king in real estate.
Only get a fifteen-year fixed-rate conventional mortgage with at least 10 percent down and a payment that is no more than 25 percent of your take-home pay.
When selling a home, think like a retailer. When buying a home, think like an investor.
We are made in God’s image . . . and God is a giver. Giving is the key that unlocks our full potential—in our life and in our money.
The act of giving changes us. It crushes our hearts and reforms us into something that looks and acts a little bit more like Christ. You can’t say you’re a follower of Christ when you’re not giving. You can’t walk around with the clenched fist and tell people about how amazing Jesus is. There’s a disconnect. They won’t believe you because your whole attitude is one of selfishness, fear, and greed. Remember, the clenched fist is the sign of anger. Jesus never talked to people about the love and grace of God with His hands balled up into fists!
Albert Schweitzer may have said it best, “I don’t know what your destiny will be, but one thing I know: The only ones among you who will be really happy are those who will have sought and found how to serve.”