All right, what's going on everybody?
In today's video, I'm going to be giving you 10 different lessons that I've learned from
Dave Ramsey.
As I'm sure you're probably aware, Dave Ramsey has endless amounts of information out there
in the forms of books, courses, programs, live events, his radio program, and different
things like that which would probably take you hours and hours to get an idea of his
best strategies, and his best tips.
In this video, I basically compiled a top 10 key lessons and strategies that you can
use today to become more savvy in personal finance as well as to start to build wealth.
Let's get into it.
All right so to start this video, a little bit of background on Dave Ramsey, which most
people are not even aware of.
When he was in his mid to late twenties, he actually went bankrupt flipping houses.
He was using a lot of speculative, short term, high interest rate types of loans, and the
economy ended up crashing, the bank called his notes due, and he was not able to pay
his debts and ended up having to declare bankruptcy.
Now you're probably wondering why someone who has declared bankruptcy would be qualified
to give personal finance advice and in my opinion I think that's probably the best person
to give you personal financial advice because, they have seen the worst of the worst, and
they've also seen the best of the best.
After he had went bankrupt, he had to rebuild everything, his life, his income, his livelihood.
I think he was married with kids at the time.
I mean it must have been incredibly stressful situation.
So after he went bankrupt, he learned everything there is to know about personal finance.
He could have no gaps in his personal finance knowledge.
He had to change his situation very quickly, so he learned everything there was to know.
He read.
He went to seminars.
He got mentors.
He learned the best strategies and the best tactics and then he started teaching other
people.
His most famous principle, which maybe you've heard of is called The Debt Snowball and that's
where let's say you're trying to pay off all your debt.
You have three or four different debts of different amounts.
You go after the smallest ones first.
You want to get that quick win.
You want to start building some cashflow.
Maybe you were just paying $100 per month for one of your smaller debts.
Now then you pay that off.
You have an extra $100, and you've also got the win of paying off that debt.
Then you go after the second largest one, then you go after the third largest and so
on and so on until you've completely paid off everything.
I think that's a great strategy, starting small and working your way up.
You get the wins along the way.
You build up experience.
You build up more income, become a little bit savvier to the point where you can take
on that massive debt where there's student loan or medical bills or whatever it is.
Okay, the next strategy he talks about is that you should have an emergency fund of
three to six months' worth of income, and I completely agree with that.
Having been an entrepreneur, doing different deals, seeing different scenarios that can
come up, I can assure you that that is a good idea.
Not only that, I think you should have 12 months' worth of income saved up.
He says look if you're struggling to pay bills and you don't have a lot of income, just start
with $1000.
That should be your first quick win.
Start with $1000 and build your way up to the three to six months to eventually 12 months
where you can have saved income in just liquid cash, just in a bank account where you can
use it.
You know there can be different things that can come up lawsuits, medical bills, different
scenarios like job losses, things like that.
You always have to be prepared and just having that cash in the bank gives you a much better
sense of security.
Actually, I just had a Warren Buffet The Shareholders Conference and he talks about, Warren Buffet
leaves billions of dollars in cash, a little bit different scenario but, he leaves billions
of dollars in cash just for buying opportunities.
Maybe if you have 12 months of income saved up, maybe use six months of that income on
a buying opportunity that could be different real estate deals, business deals, different
types of deals that come up where if you could pay quickly, and you could pay with cash,
you can get a great buy.
All right, the next lesson he talks about is that you should save 15% of your income
towards retirement and that's after you've already saved three to six months of expenses
just for different scenarios that could arise.
I agree with that and in terms of retirement, it's not necessarily putting it all in an
IRA or different things like that.
You could be buying different assets, maybe cashflow and assets like real estate, different
things like that to help prepare and pay for your retirement because hey, what if you wanted
to retire at age 30?
Buy a couple of apartment buildings.
Buy some rental properties but, overall you should be putting a good amount, a good portion
of your income towards retirement.
The next lesson he talks about is that buying things to make you look rich can destroy your
finances.
That's the whole keeping up with the Joneses mentality.
Me, personally, I don't mind living in a inexpensive apartment while I'm building up assets, buying
million dollar properties, doing different things like that.
It's totally fine with me if someone wants to drive a BMW and use all of their income
to look like they're rich because just a few years of saving up and building assets and
investing in the right things can set you up for life.
If you just do three, four, or five focused years, maybe buy some rental properties, maybe
you save up some investments, maybe you invest in different programs, mentors, and things
like that and evolve your skillsets, that's going to be a much better investment than
spending all your money on some big house or big car or the most expensive watches or
different things like that so that you can keep up with the Joneses.
The thing to know about the Joneses is that they have a ton of debt, and they have to
work for their money.
Most of the time the Joneses, they don't have cashflow and assets.
They might have a high paying job but what happens if that job dries up?
What happens if they get laid off?
They're screwed and that's where you as a savvy investor, if you have cash saved up,
maybe you purchase that property at a discounted rate but, you want to build assets and not
liabilities.
Okay, the next lesson he talks about is to give generously and something about giving
money to charity, no matter what charity it is, maybe you have the local pet adoption
center, or your friend's Facebook poll or whatever it may be, giving money gives you
a sense of abundance and really changes your perspective, and you just feel good about
it.
You feel like money is not an issue, and I can guarantee you if you're broke, and you
give $20 to somebody in the form of a charity, that is going to make you feel great, and
it's probably going to change your perspective on money.
All right, his next lesson is to not buy a new cars.
I'm pretty sure everybody says that but buying a new car is probably one of the dumbest financial
things you can do.
Now if you just have millions and millions of dollars, yeah, maybe buying a new car is
not going to really make or break the bank but, if you really want to be savvy, you know
anytime you buy a new car, 15% to 20% of that value is just lost right there that day.
There's different ways of buying cars or maybe you lease a car if you have a business.
You can talk to your CPA about that where you can actually ride off your car and if
you're leasing it, hey, you can get a new car every couple of years but, just don't
buy a new car.
It's not the most strategic thing to do.
If you're worth $10 million, yeah, buy a new car.
It's not going to really make a difference but, if you're really trying to be savvy about
personal finance buying a new car is not the best idea.
All right, the next lesson he talks about is to take out a 15-year mortgage as opposed
to a 30-year mortgage.
I have mixed opinions about this but Dave Ramsey's all about just having zero debts,
no debt whatsoever.
He argues, by having a 15-year mortgage, obviously, it's a forced savings plan.
You're going to pay off your mortgage a lot sooner, and you're going to be forced into
doing so.
Now your mortgage is going to be at a higher rate but hey, 15 years goes by fast and before
you know it, your house will be paid off free and clear.
Just to play devil's advocate, the other side of that would be if you had a 30-year mortgage,
you probably have a little bit more money every month to invest in different things,
and you could still pay your mortgage off in 15 years even if you have a 30-year mortgage.
You're just not forced to.
His whole thing is that by being forced to, it's going to make you take more action and
make you be more diligent and more disciplined.
All right, the next lesson he talks about and this is actually my favorite one is to
increase your income.
Of all the strategies, this is actually one of his most important points.
You can save money for years but if you're not increasing your income, increasing your
skillset, and becoming more valuable, it's not going to make that big of a difference
because your income is going to be your greatest asset.
You need to find ways to increase your income and for me personally, the way I have increased
my income was reading books, learning very specific knowledge, getting mentors, going
to live events, and most people think, "Hey, you're wasting your money on that," but, I
might learn one or two things that can help me make more income.
For example, I just took a YouTube course where they talk about you should make 10-minute
to 15-minute YouTube videos.
You're going to have more engagement.
You're going to make more money by doing that.
Most people would never take a course like that.
You want to do many different things like that where you try to improve your skills,
try to increase your income.
That's going to be the overwhelming factor in becoming wealthy or not.
If you're working at McDonald's and you just have the same skillset for 30 years, eventually,
a robot is going to take your place.
You need to always be evolving.
Your skills should not be the same from the previous year to this year.
Okay, to wrap this up.
One of his most important points is to celebrate all wins.
After you pay off even if it's a small debt, you should celebrate that.
If you look at Dave Ramsey's Instagram page, and you should follow me too on Instagram.
Don't just follow him but, if you look at his Instagram page, it's all about case studies
and testimonials of people saying, "Hey, I just paid off $5000 of debt."
"I just paid of $15000 of debt."
"I just paid off $200,000 worth of debt."
And, they're the happiest people in the world.
You should celebrate all wins.
Celebrate all milestones whether you get an increase income, whether you're paying off
a certain debt, whether you just got a great deal in real estate, celebrate everything.
It's very important and it's going to help you along your journey.
Okay, so, thanks for watching this video and let me know if you have any questions in the
comment box below.
Please like, please share, please subscribe and I will see you in the next one.