Thursday, February 28, 2008

Book Review: Dave Ramsey’s The Total Money Makeover

For the past few weeks, I had some time to read a book by Dave Ramsey - The Total Money Makeover. This book can be found in our libraries.
His method is not easy. It is not a get rich quick scheme. It requires sacrifice, hard work, and focus. In fact, printed on the bottom of every page of The Total Money Makeover is the book's motto:

If you will live like no one else, later you can live like no one else.

Dave explains: 'If you make the sacrifice now that most people are willing to make, later on you will be able to live as those folks will never be able to live.' Filled in the book are testimonies of people who has use this philosophy.

The seven baby steps are :
1. Save $1000 as a Starter Emergency Fund
2. Debt snowball - pay down debt (become debt free except for the house)
3. Finish building the emergency fund - Kick Murphy out
4. Invest 15 percent of your income in retirement (for me, at least $2.5K a year)
5. Save for children's education. (Why? Don't pass a legacy of debt like study loan to my children, Look also into scholarships, bursaries)
6. Pay off the Home Mortgage. Read the myths and truths - can you really make the extra 2-4 % over the CPF rate? When the smoke clears, we really don't make a lot.
7. Build wealth

Have a blessed day!

A detailed review by another blogger can also be found here.

Labels: ,