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Do you have a car payment? A line of credit? A mortgage? Do you have student loans? If you said yes to any of those questions, this post is written specifically for you.

I can’t figure out when or how I came across Dave Ramsey, but I am so grateful I did. Dave is the voice of debt repayment. Every day for three hours a day he hosts a radio show that is broadcasted live on youtube, facebook and is later offered as a podcast anywhere you listen to your favourite podcasts. He teaches millions of people how to get out of debt and how to be debt free. By following Dave Ramsey’s baby steps it is possible for anyone to become debt free. The hubs and I are on his plan and are currently on Baby Step 2 and crushing our goals hard.

So why should I worry about debt? I make my monthly minimum payments, I’ve never been late on a payment and my credit score is awesome.

Well, with most debt, the longer you have it the more money you throw away in interest payments. Banks WANT your money, and interest is their bread and butter. As Dave says, your greatest wealth building tool is your INCOME, and debt makes this number lower the more you owe! Imagine having no car payments, imagine keeping all the money you make? Yeah, it’s possible, and the Dave Ramsey Baby Steps will get you there.

Baby Step 1: $1,000 to Start an Emergency Fund

Sell anything that isn’t attached to the floor, make a budget and cut back on expenses. Save the $1000 as FAST as you can. If you already have a savings account, take everything out of it and leave $1000 in it and put all the rest to your debt. The idea for this fund is that it’s an EMERGENCY fund. A birthday is not an emergency, because you knew it was coming up. With this in the bank you won’t have to go into debt if something were to happen.

Baby Step 2: Pay Off All Debt but the House

List all your debts from the littlest one to the biggest one and list your monthly minimums. Every month, make a new budget with your partner and attack that little debt with a vengeance! Throw every last dollar you can at the little one until you pay it off. When you do, take all the extra money you were putting towards the debt AND the minimum payment you were making and add it to what you pay to the second debt on the list! This is his snowball method and the idea is that the motivation of knocking off the small debts will inspire you to keep going while freeing up more money to pay off the larger debts!

Baby Step 3: 3 to 6 Months of Expenses in Savings

Now you are debt free! Congratulations!! Time to build your emergency fund to a full fund. This means, add up all your expenses for the month. Mortgage, food, utilities, insurance etc and multiply that number by how many months you want to save. He recommends 3-6 month’s worth. Now this is your new savings goal! This will allow you to be prepared were life to throw a huge wrench your way. This and all his steps are also available on his website.

Baby Step 4: Invest 15% of Household Income Into Retirement

Now that you have no payments and a fully funded emergency fund, time to make that money work for you. Invest!! Take 15% of your gross household income and invest it into a Tax Free Savings account, your work’s matching RRSP etc. Remember, time is of the essence and you will benefit from compound interest when it comes to this step. Stay consistent and soon you will be a millionaire. It’s just math!

Baby Step 5: College Funding for Children

Now that your future is taken care of thanks to investing it’s time to start saving for your kid’s post secondary education! The Canadian government has something called the RESP and by contributing to it the government matches 20% of your contributions up to $500 a year. (aka, free money!) This is a great way to start saving for your child’s education.

Baby Step 6: Pay Off Home Early

Now, there’s just one more debt standing between you and a truly debt free lifestyle. Can you imagine not having a mortgage payment?! I’m freaking out over here just thinking about it! Any extra money you put towards your mortgage is going to shave off so much interest and so many years off your mortgage! This is a huge one, and usually, especially in Canada, we don’t often find mortgages for 80 or 90k like our neighbours to the south do, so our debt here is quite large. Just keep at it. You have no payments, your life is well set up after following all the baby steps, so enjoy your money while paying down your house faster!

Baby Step 7: Build Wealth and Give

Max out your RRSP and TFSA investment contributions per year, and have FUN. As Dave says, you live like no one else so that later you can live and give like no one else. Become incredibly generous, and do whatever you want. You have done so well. Congratulations!

All the baby steps and more on the entire idea behind Dave’s plan, including his own personal story, is detailed in his book the Total Money Makeover, which I could NOT recommend more. I actually wrote about My Top 5 Personal Development books and you better believe this was on that list!

Best of luck on your journey. Are you following his plan? What baby step are you on?

 

 

This post contains affiliate links. What does that mean for you? It doesn’t cost you anything extra but I get a small percentage of your purchase if you decide to purchase something from the post. I do this to make some side income while linking you to the great products I use. I will never write a post about a product I do not believe in, and no one has paid me to write this post. All opinions are always my own. Just like supporting a friend’s small business, by clicking on my affiliate links you are supporting a small time blogger who deeply appreciates it. Read more about this on my about page.

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You failed. It happened, and now you can’t stop thinking about it. It’s ok, we’ve all failed before, and guess what, we’ll fail again. But we need to move past it! Here are some tips on how to finally STOP OBSESSING over that time you failed! Time to move on, move forward and get to the next thing.

1. Admit it, but don’t BECOME it.

Don’t let that one thing that didn’t go quite right define who you become. You do not become a failure, ever. Admit that it happened, but don’t let it touch who you are. You are a try-er, and these are the things you have to go through to get to the place you want to be! Our self-esteem drops when we decide to become our fails, and that’s not only damaging but it lowers our frequencies and slows down our progress. Nobody wants or deserves that!!

2. Feel what you feel.

There’s nothing good that’s ever come from ignoring our emotions. Figure out how you really feel and put it into words. Do you feel angry? disappointed? sad? It’s all ok, and guess what? It’s all natural! Allow yourself to feel what you feel. Once you do, it’s time to move on.

3. Turn it to ashes.

Writing something down gets the energy out of your body. Putting your emotions and situations on paper allows you to clear your mind. Truly. So take a moment, and write it down. The failure, your feelings. Put it all out there onto the page. And then, turn it to ashes. Burn the paper and let the ashes fly away and take everything with them. It’s a very freeing moment.

4. Sage it.

You’ve now gotten rid of all these negative thoughts and emotions that were swirling around inside you. Here’s the thing, though, energy lingers. I can’t seem to focus when I have a cluttered space or when it feels stuffy and heavy in the room or in the house. Ever feel that? Like no matter what you did, you still don’t feel quite right? it’s time to clear the negative energy and clean the space around you. Nowadays you can find these things anywhere, but go grab yourself a sage smudge stick and use it. Sage has been used for centuries to clean and purify areas. Make it work even more by saying some positive thoughts as you do this, or pray, whatever you’re into.

5. Let go of other’s opinions.

Sometimes, when we’ve failed it isn’t so much the failure that we get really anxious about, it’s when it’s a public failure. When people know. What will they think now? Deep down we all have this fear of not being respected or believed in, and failing makes us feel less than. But guess what? You’re not the first person to have failed. You’re not the only person in this world that things have not turned out for. So let go of the care for what other’s think of you because you tried, and somewhere along the way, you will succeed, and that day, you’ll know that it was all your hard work, your dedication, and your drive to stop obsessing about that one time you failed.

Love always,

Mariangelica

 

This post contains affiliate links. What does that mean for you? It doesn’t cost you anything extra but I get a small percentage of your purchase if you decide to purchase something from the post. I do this to make some side income while linking you to the great products I use. I will never write a post about a product I do not believe in, and no one has paid me to write this post. All opinions are always my own. Just like supporting a friend’s small business, by clicking on my affiliate links you are supporting a small time blogger who deeply appreciates it. You can read more about this on my about page. Thanks love.

 

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