The 5 Money Principles According to Dave Ramsey

We got to back up, we got to put data in front of us. And once we all agree on exactly where we are, then we can discuss where we're going. And I think, you know, building wealth or having a high quality life in any area is a little bit like that. You need to back up and say, okay, what are the principles? Before I worry about the tactics. And the principles should lead us to the tactics and the five money principles. If we wanted to pull some out, there would be common sense, biblical things that are kind of boring. But if you lay those principles in place, then they'll lead you to the tactics. I mean, here's one. Live on less than you make right now. That sounds kind of almost glib, you know, but the Bible says the borrower is. I mean, it says a foolish man devours all he has. Live on less than you make. You need to be on a written plan in anything you're doing. If you don't do it intentionally, it's not going to occur. No one wins anything except accidentally. It's an intentional act. Winning always is. At marriage, at taking care of your body, building a business, you know, money. No one accidentally gets wealthy. It just, oh, what happened? No one does that. So that's a written plan. That's called a budget, you know. And so we got to have a budget. We got to live on less than we make. If you get out of debt, mathematically what it does is you have money to invest. Because when you have a $750 payment on your Ford F150, you got no money. And so that money's going to forward instead of to you. It's not going in your 401k. And so that's what the borrower is slave to the lender means. But also what happens when you get out of debt is you have this sense of freedom, you have this sense of autonomy, the sense of agency. You're not being controlled by the man stinking bank of America. It doesn't tell you what to do. Ford Motor Credit doesn't tell you what to do, so you don't have to keep a horrible job. You can move to a better job and take that risk. But if you got to pay payments, you don't feel free. And so, you know, being out of debt, living on less than you make, having written plan, obviously saving and investing, obviously. In the house of the wise are stores of choice, food and oil. Grandma said have money saved for a rainy day. We start with an emergency fund and then we long term invest in the largest study of millionaires ever done in North America. We did it here at Ramsey. We discovered that the typical way someone gets their first 1 to 5 million is they have a paid off house and they have a really healthy 401k or Roth IRA combo in good mutual funds. And so they'll be sitting there with a million dollars in their, in their retirement accounts. After 10, 12, 15 years of doing this and they got a half million dollar or seven hundred thousand dollar paid for house, they got a 1.7 million dollar net worth. And so save money, save money.