I NEVER would’ve believed that, as a single mom, I’d find myself on baby step 6! I started to truly focus 3 years ago, and that’s when I found Dave Ramsey. I don’t own a home yet. I’m still saving up for a down payment. But my down will be right about 20% and then I calculate I will pay it off in 5 years. I have finance meetings with my sons every couple weeks and we are a team! I’ve been sharing your videos with my friends too :)
I used to earn a min wage and rented a small room in a basement of a building the size of a walk in closet (Maybe it was a walk in closet). Now, I'm a multi-millionaire. You never know what life brings you but I never gave up.
I've just realized I'm doing step 2 before step 1 and that's why I'm struggling with my finances when even small financial emergencies happen. Thank you for your videos! 🙌🏼
Baby Step 1 - $1,000 to start an Emergency Fund Baby Step 2 - Pay off all debt using the Debt Snowball Baby Step 3 - 3 to 6 months of expenses in savings Baby Step 4 - Invest 15% of household income into Roth IRAs and pre-tax retirement Baby Step 5 - College funding for children Baby Step 6 - Pay off home early Baby Step 7 - Build wealth and give! PS - Good to see you Rose!!
@@msmaluu Dave Ramsey calls this "Baby Step 3B." After your emergency fund is fully funded, you can start a side savings fund for a house down payment.
I started Ramsey at age 30. It changed my life and provided a foundation that allowed me 4:03 to open a lucrative business and become a multi-millionaire. Dave is the OG. Once you get to his baby 7, he hands off the baton to others. But his steps are foundational.
4-5-6 currently - After watching your video, I realize I need to re-prioritize my budgets and get back on track. Time to look into the every dollar app.
Hey, Rose. Started watching 11 months ago and I have started a finance channel partially due to you. Your videos have helped me start investing. Thanks
I got stuck going back and forth on steps 2 and 3 for many years because of job loss, medical bills, and car repairs. Now I’m finally on steps 4 and 6 but I’m in my mid 40’s so I feel like I have lots of catching up to do and no time to slow down yet.
Investing With Rose - Thank you for your reply Rose. But I really don’t trust crypto yet. I don’t know enough about it and it seems awfully risky. I will try to learn more about it but for now I’m investing mainly in etfs and some mutual funds.
This program help my family get out of debt and save for the emergency fund. When you think you would not need the fund, consider how many people have been without a job and waiting for EDD to start since March or April, or a businesses that can’t open for the same period of time.
Hello Rose and thank you for sharing this practical advice! I have our financial plan all mapped out and am on step 2. I’ve constantly bounced back and forth between 2-3-4 due to accumulating new debt and having to shift focus. In 3 years, I’ll be fully on step 6!
How long did it take to pay down? I had 150k of student loans and paid off 6 in Jan/feb (18k). I used money in my savings since I had more than 6 months of an emergency fund. Once the pandemic hit I paused that to save money. I’ll be able to pay another lump sum when I feel comfortable with my job security/economy etc.... but I feel like it knocked my momentum off!!! I had a plan 😣
I've spent this entire year paying down $24,000 of credit card debt. I started seriously working on it in March, and continued on throughout the pandemic. I'm now down $15,000 and DR and Aja Dang were the inspirations for me to start. I just made a video like this one talking about DR's baby steps and analyzing if they really work. There is no doubt in my mind with what I've accomplished that they truly do work. Specifically with getting out of debt. I still have a little bit to go before I'm finished with baby step 2, but it's working and I'm doing it.
Excellent video! I’ve been on Baby Step 7 for the past 6 years! I’m 33 years old and I plan to achieve Financial Independence in 2-3 years and Retire Early in 3-5 years! Keep sharing your financial knowledge :)
Great video! Rose I am on baby step #2 and it’s one I’ve really struggled with. Fortunately I’ve recently tied the goal of moving abroad to it and am now practicing a no spend rule. Thank you for your videos , they keep me focused and determined. Bless you.
I guess I'm on Step 4 still? I just became debt FREEEEEEEE two Fridays ago! Even the mortgage is gone! It's an income property so the tenants paid most of it ;-) These last two years I've been taking full advantage of my employer's $1-for-$1 match on up to 6% contributions to my 401k. And last year they started a "retention bonus" of an extra 2% if you work the entire year. So if I contribute 6% I get 8% (by the end of Q1). Does that count as 14%?
Sounds like an awesome employer! The 15% that dave recommends is what YOU contribute to retirement. It’s awesome that your employer is contributing so much, but why wouldn’t you add fuel to the fire and help get to your retirement number faster?
@@Albimar17 The reason an employer will match your 401K is often because they control what investments go in and out. They make money off of your contributions via investments and thus offer incentives for you to contribute (typically up to 6%). There's no conspiracy behind it, just economic science.
It's a great question; here's how I personally calculate it (everyone probably does it their own way, though: I consider the employer match part of my gross income. Using simplest possible numbers, say I earn $100 and stash the $6 to get $8 worth of match. In this case, I've "earned" $108 and should put 15% of THAT into retirement, which is $16.20 instead of $15. Thankfully, the employer has put in $8 and I've already done $6, so I need to add $2.20 Best wishes. NB: *gross* income is also *before* insurance, income & payroll deductions, etc. Use 15% of the WHOLE amount of your monthly salary.
@@Albimar17 Haha yep, that's a core principle of investing; accepting risk. There's also a lot of economic science behind investing so it doesn't just magically get multiplied. You have to be smart about investing, understanding where your money goes, and diversifying your portfolio. I agree that if you stick with just a 401K to retire with, a lot can backfire, but that's the reason behind diversification. It all depends on how you want to approach investments!
Hi Rose, In one of your recent videos, I requested you to recap/summarize your video content towards the end to help viewers retain more information. I'm glad to see that you take viewer feedback seriously and continually improve your videos. Thanks. I hope that you and your husband are doing well during these difficult times. -Adi
Thank you, Rose. These videos are incredibly motivating and I love your calm approach. So many of the financial channels on TH-cam are hosted by speed freaks who I picture hanging out in bars and asking people their net worth. You seem very genuine and I believe that you have and will accomplish your goals, and will help me accomplish mine as well!
One of the most valuable aspects of Baby Step 5 is it’s contribution to generational wealth. I worked two jobs to pay cash for my children’s college in addition to our savings. Their not have student loans started them so far ahead of their peers that had student loan payments.
It is excellent to see this video. I have really enjoyed your videos to date. They have been extremely helpful to us on our financial journey. So, we haven't been exactly following everything in order. But are doing what works for us. We are in our early 30s and looking ahead to how we go from here to retiring comfortably. We have completed step 1. Working on step 2. We still have auto loans on our cars (purchased used) and I have $8,900 in student loans. We also have three financial credit accounts with 0% interest. The student loans will be paid off in full early next year when we sell our condo and move into our new house. The auto loans are through a credit union. So interest rates are less than 3.5%. So we are overpaying to have them paid off in less than 3 years from the date of purchase. The consumer debt is being paid at a rate that will have it paid off before any interest starts up. We have completed step 3 and have a 6 month emergency fund. We are also doing step 4 by saving 20%+ monthly for retirement in our accounts using the waterfall approach of maxing out the accounts with tax benefits. Also, we have locked in our term life insurance while younger to get the better rates. So, we are getting there. No kids or plans for kids.... so there is one step we do not have to do.
Rose. I am swamped with work but I am so glad you are back from your break. I have been pouring through your videos and just taking in the content. HSA!! FTW!!! Thank you for breaking it down. I am going to get started on setting it up for end of year and build it. I have set up Roth and 529 accounts for my kids. Thank you for sharing your knowledge and winning attitude. BTW. I am now on a crusade to pay off my student loans. My goal is to pay them off in 24 months or less.
Dang his steps changed my life too! I have been following you for years and I had never seen this video… I didn’t know you also followed his steps! No wonder I love your content ❤
Very good video i was looking forward to this. Thank you. I"m at baby step 1 and almost there. I'm determined and got my wife to do the same! Now i know what all the steps are im looking forward with a positive mindset. thank you Rose, GREAT CONTENT!!
I should be on step 2, but my debt has 0% interest rate so I'm rather investing my money to outperform the debt interest. I think this step depends on how high your debt interest rate is. Great video! Your videos always help me stay motivated to achieve financial independence.
Super helpful- thank you for this! Also I think if you don't have much left in your student debt (and your payments have been deferred due to the CARES Act) it would be good to build up that emergency fund since uncertain times lie ahead during these covid times.
Thank you for giving us directions how to be better. Like what you said in another video, school and family didn’t teach me how to do all this. My wife and me are foreigners here in the US and our family here are also used to debts
Dear Rose, i start step 1, on the 20th oct. By today, 4th nov, i achieved it. Its not that we cannot, we just don't care. I m doing step 2, i m going to do it.....
Step 6, paying bi-weekly is also a good option if you don't want to pay extra towards the principal. If you put less than 20% down, this will help eliminate PMI earlier. Also, depending on the loan amount, duration and interest, it should help pay off the home early. A ~ $300,000 mortgage paid bi-weekly can shave off about 4-5 years of payments. Paying extra towards principal every month works, too, but if your mortgage lender allows for bi-weekly automatic payments, it's also worth investigating if it's worth doing based upon free cash/budget/etc.
Rose! so glad you did video on Dave. Let’s face it HE is the antidote to bad money management. You & Dave are my daily routine on everything money! Thk u!
I’m also taking baby steps to achieve my financial freedom! 🔥 Have emergency fund, no debt, full-size emergency fund, investing 15% of my income, now it’s time for me to save for my kid’s college. (But by the 2045, I think most of people won’t go to college that much.)
I'm with you. Tuition gouging is only encouraged by all these people thinking they need to save $100K + to send a kid through college. This is summed up in their simple (and evil) phrase "Expected Family Contribution". They need to start expecting a LOT less.
Glad you're back! I'm currently working on step 3. Also I really want to know what you think about investing in courses (e. g. stock market for beginners, dropshipping etc.)
Thank you so much. I was really turn between putting all my money towards my student loan or make home improvements such as a play room for the kids. Changing heating system to deprecate the 1st and second floor. Now that I watch this. I’m just going to throw all my extra cash to my 100k student loans!
I love when I see a notification from Rose! I have been following along on my journey to financial freedom following some of your best practices. I even open a fidelity account because of you :) I have been buying dividend stock, etf's and mutual funds like FXAIX and FZROX and recently got in to selling options which I have been documenting on my channel so I can track my progress and see my mistakes along the way. You're also the reason I opened a ROTH IRA! So Thanks Rose, keep inspiring us to make our money work for us, so we don't have to work for our money :D
@@TheEdgeOfTheBlade Right! She always explains it so clearly that it's easy to understand and makes you think, ughhh why didn't I start this years ago...
Very informative videos. I didn't realize I actually completed all these steps in that order years ago...but was a late aggressive investor too much I thought to understand. Videos like yours has boost my confidence in self investing, better late than never thanks!
Thanks for this. I just graduated and currently looking for a job. This is a nice guide for me since i don't know how i will save for my future and which to prioritize.
Your way of explaining all this is very good. I have most of them done but don't forget to mention how important it is to have your spouse on the same page. Very...thank you.
Great content! I've heard a lot of positive things about this program - I'm currently on step 3! 0% student loans the last few months has. been wonderful as I started making triple payments and paid off 4/8 loans in the last 6 months!
I've done that baby steps, its good to get out of the debts, it works for me n my wife, but how to invest the i learn and do "Rose" way, im glad found your channel, thank you
Very fascinating, the whole psychology of savings, expenditures and money management. That momentum is the hardest thing to achieve. You got to get the root of why you spend and don't save. Really get to know yourself.
Guessing I am already at baby step 3? No debt and at least $1000 in savings. Working on a decent emergency fund already. Think I can skip step 5 (No kids, no plans on having any) Just need to get past step three and learn more for proper investments for step four. Canadian, so... pension plan? Learning where/how to invest will be my struggle at first. Amazing video, very informative without being confusing at all.
Hi Rose, I’m becoming fond of your videos even though I’m not from the USA and don’t live there either. I’ve just started earning my paychecks so it’s nice to have your guidance in how to manage that income despite the differences between the American banking and investment systems and the ones down where I live. Thank you for your tips and for taking time to make these videos. Hugs from Colombia!
Another amazing video Rose! Loved and second everything that was said except the "get a 10-15 year Mortgage term tip"! I'm a big proponent of using self-discipline vs. Forced discipline! People should definitely make sure they can afford their mortgage payments with a 10-15 year loan life, but they should opt for the 30 year mortgage. This will allow them to contribute any extra capital towards their mortgage in good times (up to the max amount allowed based on their contract), but wouldn't FORCE them to contribute in bad times (ex: if they lost a job, are underemployed, etc.) Renegotiating terms with a bank is a bad thing to have to do, especially if the banks is in the position of power! As always, wonderful video with wonderful messages. - Shailen
A 30-year mortgage with a low interest rate paid down slowly is the way to go. If there were a 50-year mortgage, I’d take that instead. Especially at an early age, every bit of available cash flow should be freed up for investing in the stock market. 9-12% market returns vs. a 3% mortgage rate? Very clear math there folks. And if you really want to pay the house off... invest in a taxable account, wait 10 years, sell your portfolio, and use the cash to pay off the house! Waaayyy more focus should be placed on not buying a house that consumes more than 20% of your income in the first place. Same philosophy as buying a cheap car. As long as it’s in a safe neighborhood with decent schools. And if you’re single with no kids, rent a room in someone else’s house for as long as you can stand it! House hacking is such an extreme advantage when you’re getting that first $100K of investments accumulated. If I’d only understood these things when I was younger... 🤷🏻♂️😊
@@CalmerThanYouAre1 Totally agree with you Thomas. However, I didn't want to discuss carry trading or interest rate differentials on a video designed for beginners. However, in my comprehensive videos on Personal Finance, I do discuss the advantages of using and maintaining cheap debt vs. Paying it off as fast as possible. Of course, there are always pros and cons to any strategy, some people are just extremely risk averse and want to be completely debt free, which if it helps them sleep better at night, is fine with me. Everyone's situation is different. If someone has the majority of their income source tied to risky work where this income source could stop abruptly, I would expect them to be risk averse and in favour of repaying off all debts as soon as possible. But yes, if life had no hiccups, earning 8% in an ETF > saving 2% of interest expense, so every dollar should theoretically go toward investments vs. paying off (cheap) mortgage debt. - Shailen
I agree with the fixed 30. Thats what I do. Pay extra monthly. Ramsey teaches 15 to get it over with but I’ll be done in 10 on a 30 and still have the opt out clause if hard times come.
@@beans2605 Exactly. This way you're in charge of your finances and protected from the Bank's power should you fall on hard times. Glad to hear you'll be done so quick! - Shailen
I am currently on step #2. Hope to be done with it by mid 2021. I do put a little in investing and an IRA and all my kids are grown but I will be putting some away for my grandkids on step 4. And I don't own a home
To my great surprise, getting a job is the hardest part... Seriously, I did my Ph.D. in Chemistry and now, I keep hearing that I'm overqualified, or that I lack industry experience... The second major worry for me is that job security has been constantly decreasing, making planning to settle down increadibly risky. Moreover, in my parents' generation, everyone from the middle class could afford a house with a garden, but now, you need approximately 2 million EUR to get that near a city! It slowly drives me nuts the combination of uncertainty, being forced to live in a place where I can't even go upright through a doorframe or stand straight under a shower, and am constantly bothered by my neighbours. I don't ask for a life in luxury, but I'm certainly not born to live like this!
Come to Indiana, houses here are cheap and we have many pharmaceutical companies and agriculture that would hire a chemist in a heartbeat. It's mostly small towns and lots of state parks. Be brave and make a big change in your life before life starts to change you.
He is pretty extreme with the no credit cards / no credit in general, but he also went completely bankrupt and managed to come back from it...these days, he can totally afford to not use credit.
Agreed; in our process we are largely following the baby steps, but once the debts are paid off, and the cash flow is stable, we will be cash flowing through a credit card for air miles. The card will not maintain a balance, but we need to go home more than once every 3 years... and man, now that the kids need plane seats it is expensive.
I think of it as going to an Alcoholics Anonymous meeting. A lot of people in the general population can have a drink or two and be fine however most people in that meeting should never touch alcohol again. It’s the same with credit some people can’t control the impulse to spend.
I love Dave Ramsey but I’m loving you too Rose! I just found you recently and love it as I compare your view with Dave! I follow the baby steps religiously 😁. You should totally be a team member on the Ramsey show, #daveramsey #investingwithrose
Thanks to all of your videos and Dave R. And some other ones, I'm now very close to paying off all of my debt, I'm investing 12% for retirement, and I'm close to having 6 months worth of my expenses!!
Thnks for your content, Rose! This video finally put into words what I have been trying to plan this whole month for my life. I’m currently on baby step 3 which will conclude in December, and then I’ll be immediately proceeding to step 4. My goal is FIRE - I want to retire in 10 years before I turn 40 so I can enjoy my time with my future family - before I get old and crankier. And I know I can do it, I just don’t have a clue on a career goal to make more money - figuring that out has been a lifetime struggle. So I’m currently looking into real estate (bad choice during pandemic, I know) and generating a bunch of passive incomes. But I’m a bit stuck as how to start. Any help is welcomed 😅
With interest rates so low for the foreseeable future...compounded with opportunity cost.. I think paying off mortgage soon is the one I would omit off this list. Especially if you think you may ever turn that property into a rental. And allow someone else to pay down that loan, and add equity to an asset that's costing you less by stretching it across 30 years fixed. Just my opinion. Thanks for the content Rose
I skipped step one and have 4 months left to complete step 2. Since paying down debt can seem like a very LONG process, I watch these videos to keep me motivated. The reason I skipped step one is because if I had a $1,000 emergency, I could simply not pay the very large payment on my debt out of my next pay check, and I would have far more than $1,000.
Where does saving for things you want come into play? I'm currently on baby step 6 but don't have a mortgage to pay off (no house or car, since it was never in the baby steps to save for those). If I'm following the baby steps correctly from step 1, I've been using the savings for things like emergency fund, and then once I established 3-6 months living expenses, I shift the incoming money that would go to an emergency fund into 15% retirement instead. I assume saving for things you want come somewhere between baby steps 3-6? If I'm trying to buy a house, around what baby step should this happen? If I save for a house after building 3-6 months of expenses, it would be an opportunity cost; a time loss on saving for retirement, especially in a high cost of living area like CA (though I should probably move). It would seem there's a choice in saving for a house and little retirement stashed or renting for awhile and having a larger retirement nest. What are your thoughts? Love the channel and I appreciate all of the financial advice, Rose!
Love love your videos, since Feb I have paid 16k to my consumer debt and I recently refinanced and I will be having an additional 400 dollars as month. Starting in November. I want to max out my Roth IRA this year so the last of my consumer debt (10k at 0% interest till 2022) I will work on really hard Jan-March of 2021 as I have secured a second job and will be getting money from my taxes. I hope to be done with baby step 2 by my 35th bday in April and begging my wealth building journey after that. I don’t know that I am going to pay off my mortgage because I just got a 2.99% interest rate and will probably used that money to max out my Roth IRA, Roth 401k and open a taxable brokerage account.
Recently found out about Dave so my steps are not quite in order, been paying extra on my house and retirement savings only at 9%, but I will be on step 5 with a few adjustments.
Thanks for watching! For more guidance on crypto to invest in, clarification, tips, support and account management inbox me privately. Forward a request... +1405-4709-099
I got to step 2 easily..almost got thru it and then I moved for a job and I'm back at step one again....but I should have it done by this coming paycheck.
would love a video of what dave does right vs what he does wrong. His baby steps are iconic but he recommends investing in mutual funds as opposed to index funds.
The step I disagree with is paying of a home early. I would invest what extra you would put on the home. Your investments compound up while inflation slowly reduces the adjusted dollar amount down of your mortgage. Look at it like this, my parent's first home in the town that I grew up in had a mortgage of $236 per month. They got that loan in the late 1960's. Now, imagine that they put money in the bank or CDs or stocks or a mix of all three for even fifteen of those years. Can you imagine seeing money grow in an investment while your mortgage effectively becomes cheaper every year by the inflation rate? $236 in the late 60's was a bit of money, lower middle to middle class, back then. Imagine how little $236 felt by the 1980s or 1990s or late 1990s when the note was 30 years old and gone. But, if you still want to pay off the home early, I would still save/invest outside of the extra home payments then when you have enough to pay it off all at once, then do it or don't. That is cheap insurance and a risk reducer. Think about plowing money into a home and then you have a medical crisis and can't work or you lose a job. What if you only have your several months of savings / emergency fund built up. You can't exactly borrow against your home to get at your asset unless you have a job. You could lose a home if you get behind on payments when you may have been paying ahead for several years, then BOOM you get evicted and it gets auctioned off...and not for full value if you cleaned it up and sold it yourself.
I NEVER would’ve believed that, as a single mom, I’d find myself on baby step 6! I started to truly focus 3 years ago, and that’s when I found Dave Ramsey. I don’t own a home yet. I’m still saving up for a down payment. But my down will be right about 20% and then I calculate I will pay it off in 5 years. I have finance meetings with my sons every couple weeks and we are a team! I’ve been sharing your videos with my friends too :)
That’s awesome
Congratulations. Keep it going. Financial freedom is one of the best feelings you can have in your life.
Marybel as a single mom this was so inspiring. Thanks for sharing your testimony
Me too sista
I used to earn a min wage and rented a small room in a basement of a building the size of a walk in closet (Maybe it was a walk in closet). Now, I'm a multi-millionaire. You never know what life brings you but I never gave up.
I've just realized I'm doing step 2 before step 1 and that's why I'm struggling with my finances when even small financial emergencies happen. Thank you for your videos! 🙌🏼
Baby Step 1 - $1,000 to start an Emergency Fund
Baby Step 2 - Pay off all debt using the Debt Snowball
Baby Step 3 - 3 to 6 months of expenses in savings
Baby Step 4 - Invest 15% of household income into Roth IRAs and pre-tax retirement
Baby Step 5 - College funding for children
Baby Step 6 - Pay off home early
Baby Step 7 - Build wealth and give!
PS - Good to see you Rose!!
Thanks for sharing your notes... I still saw the vid and liked!
Um what if you didn’t have a mortgage to start with? At what step do you save for that?
@@msmaluu Dave Ramsey calls this "Baby Step 3B." After your emergency fund is fully funded, you can start a side savings fund for a house down payment.
@@caitox thank you!
@@caitox I couldn’t find it in the book but that what logically made sense
I started Ramsey at age 30. It changed my life and provided a foundation that allowed me 4:03 to open a lucrative business and become a multi-millionaire. Dave is the OG. Once you get to his baby 7, he hands off the baton to others. But his steps are foundational.
We went from BS1 to BS7 in 2020. Talk about life changing!!! So thankful for Dave Ramsey 💙
4-5-6 currently - After watching your video, I realize I need to re-prioritize my budgets and get back on track. Time to look into the every dollar app.
Hey, Rose. Started watching 11 months ago and I have started a finance channel partially due to you. Your videos have helped me start investing. Thanks
I got stuck going back and forth on steps 2 and 3 for many years because of job loss, medical bills, and car repairs. Now I’m finally on steps 4 and 6 but I’m in my mid 40’s so I feel like I have lots of catching up to do and no time to slow down yet.
Investing With Rose - Thank you for your reply Rose. But I really don’t trust crypto yet. I don’t know enough about it and it seems awfully risky. I will try to learn more about it but for now I’m investing mainly in etfs and some mutual funds.
I'm grateful to be in step 7 during a pandemic. It takes a load off knowing losing my job doesn't mean losing my home.
Precisely why I decided this year not to move to a bigger house. So glad I don't have a mortgage right now.
This program help my family get out of debt and save for the emergency fund. When you think you would not need the fund, consider how many people have been without a job and waiting for EDD to start since March or April, or a businesses that can’t open for the same period of time.
My guilty pleasure watching Rose and listening to financial advice at the same time!
Hello Rose and thank you for sharing this practical advice! I have our financial plan all mapped out and am on step 2. I’ve constantly bounced back and forth between 2-3-4 due to accumulating new debt and having to shift focus. In 3 years, I’ll be fully on step 6!
💪🏼💪🏼💪🏼
I LOVE Uncle Dave! About 3 more months to go on my $133k student loans thanks to him and I just graduated started paying them Nov 2019🙌🏾
How long did it take to pay down? I had 150k of student loans and paid off 6 in Jan/feb (18k). I used money in my savings since I had more than 6 months of an emergency fund. Once the pandemic hit I paused that to save money. I’ll be able to pay another lump sum when I feel comfortable with my job security/economy etc.... but I feel like it knocked my momentum off!!! I had a plan 😣
How did you do it?
I've spent this entire year paying down $24,000 of credit card debt. I started seriously working on it in March, and continued on throughout the pandemic. I'm now down $15,000 and DR and Aja Dang were the inspirations for me to start. I just made a video like this one talking about DR's baby steps and analyzing if they really work. There is no doubt in my mind with what I've accomplished that they truly do work. Specifically with getting out of debt. I still have a little bit to go before I'm finished with baby step 2, but it's working and I'm doing it.
Excellent video! I’ve been on Baby Step 7 for the past 6 years! I’m 33 years old and I plan to achieve Financial Independence in 2-3 years and Retire Early in 3-5 years! Keep sharing your financial knowledge :)
Awesome!! This is great ❤
Great video!
Rose I am on baby step #2 and it’s one I’ve really struggled with.
Fortunately I’ve recently tied the goal of moving abroad to it and am now practicing a no spend rule.
Thank you for your videos , they keep me focused and determined.
Bless you.
I guess I'm on Step 4 still?
I just became debt FREEEEEEEE two Fridays ago! Even the mortgage is gone! It's an income property so the tenants paid most of it ;-)
These last two years I've been taking full advantage of my employer's $1-for-$1 match on up to 6% contributions to my 401k. And last year they started a "retention bonus" of an extra 2% if you work the entire year. So if I contribute 6% I get 8% (by the end of Q1). Does that count as 14%?
Sounds like an awesome employer! The 15% that dave recommends is what YOU contribute to retirement. It’s awesome that your employer is contributing so much, but why wouldn’t you add fuel to the fire and help get to your retirement number faster?
Nice. I’m only doing step 4 & 7. No debt and buying property for cash flow.
@@Albimar17 The reason an employer will match your 401K is often because they control what investments go in and out. They make money off of your contributions via investments and thus offer incentives for you to contribute (typically up to 6%). There's no conspiracy behind it, just economic science.
It's a great question; here's how I personally calculate it (everyone probably does it their own way, though:
I consider the employer match part of my gross income. Using simplest possible numbers, say I earn $100 and stash the $6 to get $8 worth of match.
In this case, I've "earned" $108 and should put 15% of THAT into retirement, which is $16.20 instead of $15.
Thankfully, the employer has put in $8 and I've already done $6, so I need to add $2.20
Best wishes.
NB: *gross* income is also *before* insurance, income & payroll deductions, etc. Use 15% of the WHOLE amount of your monthly salary.
@@Albimar17 Haha yep, that's a core principle of investing; accepting risk. There's also a lot of economic science behind investing so it doesn't just magically get multiplied. You have to be smart about investing, understanding where your money goes, and diversifying your portfolio. I agree that if you stick with just a 401K to retire with, a lot can backfire, but that's the reason behind diversification. It all depends on how you want to approach investments!
Hi Rose,
In one of your recent videos, I requested you to recap/summarize your video content towards the end to help viewers retain more information.
I'm glad to see that you take viewer feedback seriously and continually improve your videos.
Thanks. I hope that you and your husband are doing well during these difficult times.
-Adi
Thank you, Rose. These videos are incredibly motivating and I love your calm approach. So many of the financial channels on TH-cam are hosted by speed freaks who I picture hanging out in bars and asking people their net worth. You seem very genuine and I believe that you have and will accomplish your goals, and will help me accomplish mine as well!
LOL so true X,D
💯
Thank you so much for your tips! I really love how you give advice based on your experience.
One of the most valuable aspects of Baby Step 5 is it’s contribution to generational wealth. I worked two jobs to pay cash for my children’s college in addition to our savings. Their not have student loans started them so far ahead of their peers that had student loan payments.
It is excellent to see this video. I have really enjoyed your videos to date. They have been extremely helpful to us on our financial journey.
So, we haven't been exactly following everything in order. But are doing what works for us. We are in our early 30s and looking ahead to how we go from here to retiring comfortably.
We have completed step 1.
Working on step 2. We still have auto loans on our cars (purchased used) and I have $8,900 in student loans. We also have three financial credit accounts with 0% interest. The student loans will be paid off in full early next year when we sell our condo and move into our new house. The auto loans are through a credit union. So interest rates are less than 3.5%. So we are overpaying to have them paid off in less than 3 years from the date of purchase. The consumer debt is being paid at a rate that will have it paid off before any interest starts up.
We have completed step 3 and have a 6 month emergency fund.
We are also doing step 4 by saving 20%+ monthly for retirement in our accounts using the waterfall approach of maxing out the accounts with tax benefits.
Also, we have locked in our term life insurance while younger to get the better rates.
So, we are getting there. No kids or plans for kids.... so there is one step we do not have to do.
This is how I got out of debt and he changed my life! Thank you Dave Ramsey and sharing his principles Rose!
Rose. I am swamped with work but I am so glad you are back from your break. I have been pouring through your videos and just taking in the content. HSA!! FTW!!! Thank you for breaking it down. I am going to get started on setting it up for end of year and build it. I have set up Roth and 529 accounts for my kids. Thank you for sharing your knowledge and winning attitude. BTW. I am now on a crusade to pay off my student loans. My goal is to pay them off in 24 months or less.
Dang his steps changed my life too! I have been following you for years and I had never seen this video… I didn’t know you also followed his steps! No wonder I love your content ❤
During Covid I switched up the steps. I first saved six months of salary and then started paying off debt. I am now paying off debt now.
Madame you’re a genius. The entire community thanks you. We don’t have the link to your PDF tutorial, please if you would. Thank you again as always
Very good video i was looking forward to this. Thank you. I"m at baby step 1 and almost there. I'm determined and got my wife to do the same! Now i know what all the steps are im looking forward with a positive mindset. thank you Rose, GREAT CONTENT!!
Currently on step 1 😁 I’ve started really late ⏰ hoping to be in step 7 in 5 years from now 🙏
I should be on step 2, but my debt has 0% interest rate so I'm rather investing my money to outperform the debt interest. I think this step depends on how high your debt interest rate is. Great video! Your videos always help me stay motivated to achieve financial independence.
Super helpful- thank you for this! Also I think if you don't have much left in your student debt (and your payments have been deferred due to the CARES Act) it would be good to build up that emergency fund since uncertain times lie ahead during these covid times.
Thank you for giving us directions how to be better. Like what you said in another video, school and family didn’t teach me how to do all this. My wife and me are foreigners here in the US and our family here are also used to debts
Dear Rose, i start step 1, on the 20th oct. By today, 4th nov, i achieved it. Its not that we cannot, we just don't care. I m doing step 2, i m going to do it.....
Step 6, paying bi-weekly is also a good option if you don't want to pay extra towards the principal. If you put less than 20% down, this will help eliminate PMI earlier. Also, depending on the loan amount, duration and interest, it should help pay off the home early. A ~ $300,000 mortgage paid bi-weekly can shave off about 4-5 years of payments. Paying extra towards principal every month works, too, but if your mortgage lender allows for bi-weekly automatic payments, it's also worth investigating if it's worth doing based upon free cash/budget/etc.
Rose! so glad you did video on Dave. Let’s face it HE is the antidote to bad money management. You & Dave are my daily routine on everything money! Thk u!
❤️❤️❤️
I’m also taking baby steps to achieve my financial freedom! 🔥
Have emergency fund, no debt, full-size emergency fund, investing 15% of my income, now it’s time for me to save for my kid’s college. (But by the 2045, I think most of people won’t go to college that much.)
I'm with you. Tuition gouging is only encouraged by all these people thinking they need to save $100K + to send a kid through college. This is summed up in their simple (and evil) phrase "Expected Family Contribution". They need to start expecting a LOT less.
Glad you're back! I'm currently working on step 3. Also I really want to know what you think about investing in courses (e. g. stock market for beginners, dropshipping etc.)
We Love Dave! We don't always agree with him on credit/credit cards but we think his views on getting out of debt is top notch!
Dave Ramsey, the FIRE guru! Thanks for sharing those steps 🙌
Thank you so much. I was really turn between putting all my money towards my student loan or make home improvements such as a play room for the kids. Changing heating system to deprecate the 1st and second floor. Now that I watch this. I’m just going to throw all my extra cash to my 100k student loans!
Paying off sizable debt is like watching the grass grow. Good job!
I love when I see a notification from Rose! I have been following along on my journey to financial freedom following some of your best practices. I even open a fidelity account because of you :) I have been buying dividend stock, etf's and mutual funds like FXAIX and FZROX and recently got in to selling options which I have been documenting on my channel so I can track my progress and see my mistakes along the way. You're also the reason I opened a ROTH IRA! So Thanks Rose, keep inspiring us to make our money work for us, so we don't have to work for our money :D
Totally agree! Like Rose has helped me focus on saving and investing for my future :)
@@TheEdgeOfTheBlade Right! She always explains it so clearly that it's easy to understand and makes you think, ughhh why didn't I start this years ago...
Thank you Rose, Dave Ramsey is a great asset for us and instructing our youth in their preparation to become viable success in our community
Very informative videos. I didn't realize I actually completed all these steps in that order years ago...but was a late aggressive investor too much I thought to understand. Videos like yours has boost my confidence in self investing, better late than never thanks!
Amazing! Thank you for making it so clear! I'm working on my emergency savings account and next I will pay off my mortgage early 🎉
Thanks for this. I just graduated and currently looking for a job. This is a nice guide for me since i don't know how i will save for my future and which to prioritize.
We are working on step 2: it is so frustrating how long this takes . But thanks for sharing, it is really helpful
Your way of explaining all this is very good. I have most of them done but don't forget to mention how important it is to have your spouse on the same page. Very...thank you.
Great content! I've heard a lot of positive things about this program - I'm currently on step 3! 0% student loans the last few months has. been wonderful as I started making triple payments and paid off 4/8 loans in the last 6 months!
I've done that baby steps, its good to get out of the debts, it works for me n my wife, but how to invest the i learn and do "Rose" way, im glad found your channel, thank you
Very fascinating, the whole psychology of savings, expenditures and money management. That momentum is the hardest thing to achieve. You got to get the root of why you spend and don't save. Really get to know yourself.
Hey Rose!! I’m glad you are here again.
Hi, Rose. I like you are so modest and wear no make-up. Thanks for being so real
Glad to see you back Rose 🌹, a lot of people need your help with financial Cris nowadays, thanks you Rose 🌹 for all great contents 🌈🙏
@Investing With Rose I’m really appreciate that Rose 🌹
I have done baby steps one and two. I am now on going in finishing baby step 3. Thank you for the advices you have given us. 😁
The way you mentioned baby step 7 makes me want to go for it
Guessing I am already at baby step 3? No debt and at least $1000 in savings. Working on a decent emergency fund already. Think I can skip step 5 (No kids, no plans on having any) Just need to get past step three and learn more for proper investments for step four. Canadian, so... pension plan? Learning where/how to invest will be my struggle at first. Amazing video, very informative without being confusing at all.
Hi Rose, I’m becoming fond of your videos even though I’m not from the USA and don’t live there either. I’ve just started earning my paychecks so it’s nice to have your guidance in how to manage that income despite the differences between the American banking and investment systems and the ones down where I live.
Thank you for your tips and for taking time to make these videos. Hugs from Colombia!
Another amazing video Rose! Loved and second everything that was said except the "get a 10-15 year Mortgage term tip"! I'm a big proponent of using self-discipline vs. Forced discipline!
People should definitely make sure they can afford their mortgage payments with a 10-15 year loan life, but they should opt for the 30 year mortgage. This will allow them to contribute any extra capital towards their mortgage in good times (up to the max amount allowed based on their contract), but wouldn't FORCE them to contribute in bad times (ex: if they lost a job, are underemployed, etc.) Renegotiating terms with a bank is a bad thing to have to do, especially if the banks is in the position of power!
As always, wonderful video with wonderful messages.
- Shailen
A 30-year mortgage with a low interest rate paid down slowly is the way to go. If there were a 50-year mortgage, I’d take that instead.
Especially at an early age, every bit of available cash flow should be freed up for investing in the stock market. 9-12% market returns vs. a 3% mortgage rate? Very clear math there folks.
And if you really want to pay the house off... invest in a taxable account, wait 10 years, sell your portfolio, and use the cash to pay off the house!
Waaayyy more focus should be placed on not buying a house that consumes more than 20% of your income in the first place. Same philosophy as buying a cheap car. As long as it’s in a safe neighborhood with decent schools. And if you’re single with no kids, rent a room in someone else’s house for as long as you can stand it! House hacking is such an extreme advantage when you’re getting that first $100K of investments accumulated.
If I’d only understood these things when I was younger... 🤷🏻♂️😊
@@CalmerThanYouAre1 Totally agree with you Thomas. However, I didn't want to discuss carry trading or interest rate differentials on a video designed for beginners. However, in my comprehensive videos on Personal Finance, I do discuss the advantages of using and maintaining cheap debt vs. Paying it off as fast as possible.
Of course, there are always pros and cons to any strategy, some people are just extremely risk averse and want to be completely debt free, which if it helps them sleep better at night, is fine with me. Everyone's situation is different. If someone has the majority of their income source tied to risky work where this income source could stop abruptly, I would expect them to be risk averse and in favour of repaying off all debts as soon as possible. But yes, if life had no hiccups, earning 8% in an ETF > saving 2% of interest expense, so every dollar should theoretically go toward investments vs. paying off (cheap) mortgage debt.
- Shailen
I agree with the fixed 30. Thats what I do. Pay extra monthly. Ramsey teaches 15 to get it over with but I’ll be done in 10 on a 30 and still have the opt out clause if hard times come.
@@beans2605 Exactly. This way you're in charge of your finances and protected from the Bank's power should you fall on hard times. Glad to hear you'll be done so quick!
- Shailen
I am currently on step #2. Hope to be done with it by mid 2021. I do put a little in investing and an IRA and all my kids are grown but I will be putting some away for my grandkids on step 4. And I don't own a home
To my great surprise, getting a job is the hardest part... Seriously, I did my Ph.D. in Chemistry and now, I keep hearing that I'm overqualified, or that I lack industry experience... The second major worry for me is that job security has been constantly decreasing, making planning to settle down increadibly risky. Moreover, in my parents' generation, everyone from the middle class could afford a house with a garden, but now, you need approximately 2 million EUR to get that near a city!
It slowly drives me nuts the combination of uncertainty, being forced to live in a place where I can't even go upright through a doorframe or stand straight under a shower, and am constantly bothered by my neighbours. I don't ask for a life in luxury, but I'm certainly not born to live like this!
Come to Indiana, houses here are cheap and we have many pharmaceutical companies and agriculture that would hire a chemist in a heartbeat. It's mostly small towns and lots of state parks. Be brave and make a big change in your life before life starts to change you.
I commonly consider Dave Ramsey a financial "extremist" (Ex: credit cards) but his advice can be very useful for a large portion of the country!
He is pretty extreme with the no credit cards / no credit in general, but he also went completely bankrupt and managed to come back from it...these days, he can totally afford to not use credit.
Followers of Dave Ramsey expect you to follow the plan to the letter. If you don't have massive I would still take the match in my employers 401K.
Agreed; in our process we are largely following the baby steps, but once the debts are paid off, and the cash flow is stable, we will be cash flowing through a credit card for air miles. The card will not maintain a balance, but we need to go home more than once every 3 years... and man, now that the kids need plane seats it is expensive.
I think of it as going to an Alcoholics Anonymous meeting. A lot of people in the general population can have a drink or two and be fine however most people in that meeting should never touch alcohol again. It’s the same with credit some people can’t control the impulse to spend.
@@davidfunvideos nope! Dave says all the time their his rules. You can pick n choose to do all of them or none or some. Try again dave
I really needed to hear this! Is there anything in that coffee cup?😅
It looks like tea. I see a little tag 🏷
I love Dave Ramsey but I’m loving you too Rose! I just found you recently and love it as I compare your view with Dave! I follow the baby steps religiously 😁. You should totally be a team member on the Ramsey show, #daveramsey #investingwithrose
Happy to see you posting, I love your videos, such wonderful advice!!
Amazing Rose, you are such a breath of fresh air. Thanks for your tips.
I'm on Step #2 and I plan to get to step 7 in 1.5 years
Thanks for sharing your experience with his baby steps Rose!
Thanks to all of your videos and Dave R. And some other ones, I'm now very close to paying off all of my debt, I'm investing 12% for retirement, and I'm close to having 6 months worth of my expenses!!
Thnks for your content, Rose! This video finally put into words what I have been trying to plan this whole month for my life.
I’m currently on baby step 3 which will conclude in December, and then I’ll be immediately proceeding to step 4.
My goal is FIRE - I want to retire in 10 years before I turn 40 so I can enjoy my time with my future family - before I get old and crankier.
And I know I can do it, I just don’t have a clue on a career goal to make more money - figuring that out has been a lifetime struggle.
So I’m currently looking into real estate (bad choice during pandemic, I know) and generating a bunch of passive incomes. But I’m a bit stuck as how to start.
Any help is welcomed 😅
I think I’m on 4.
Been considering an alternate option of retiring and living out of a van.
Baby Step 7 love it!
Exceptionally helpful video. I keep trying other TH-cam accounts and none beat yours for advice and explanations ty
I’m on step 6 house will be paid off 2024, but also put more in investments this year due to discount stock prices
My goodness... My favorite video of yours for sure. Great info! (Okay, time to get serious about paying off the mortgage...)
Hey Rose love your videos they are so informative and helpful keep up the good work. btw love your dimples
I got Dave's Total Money Makeover years ago and it was well worth it.
With interest rates so low for the foreseeable future...compounded with opportunity cost.. I think paying off mortgage soon is the one I would omit off this list. Especially if you think you may ever turn that property into a rental. And allow someone else to pay down that loan, and add equity to an asset that's costing you less by stretching it across 30 years fixed. Just my opinion. Thanks for the content Rose
I skipped step one and have 4 months left to complete step 2. Since paying down debt can seem like a very LONG process, I watch these videos to keep me motivated. The reason I skipped step one is because if I had a $1,000 emergency, I could simply not pay the very large payment on my debt out of my next pay check, and I would have far more than $1,000.
I'm currently working on saving $ for a rental property :) Great content, Rose! You inspired me to make a TH-cam channel
Where does saving for things you want come into play? I'm currently on baby step 6 but don't have a mortgage to pay off (no house or car, since it was never in the baby steps to save for those). If I'm following the baby steps correctly from step 1, I've been using the savings for things like emergency fund, and then once I established 3-6 months living expenses, I shift the incoming money that would go to an emergency fund into 15% retirement instead.
I assume saving for things you want come somewhere between baby steps 3-6? If I'm trying to buy a house, around what baby step should this happen? If I save for a house after building 3-6 months of expenses, it would be an opportunity cost; a time loss on saving for retirement, especially in a high cost of living area like CA (though I should probably move). It would seem there's a choice in saving for a house and little retirement stashed or renting for awhile and having a larger retirement nest. What are your thoughts?
Love the channel and I appreciate all of the financial advice, Rose!
Love love your videos, since Feb I have paid 16k to my consumer debt and I recently refinanced and I will be having an additional 400 dollars as month. Starting in November. I want to max out my Roth IRA this year so the last of my consumer debt (10k at 0% interest till 2022) I will work on really hard Jan-March of 2021 as I have secured a second job and will be getting money from my taxes. I hope to be done with baby step 2 by my 35th bday in April and begging my wealth building journey after that. I don’t know that I am going to pay off my mortgage because I just got a 2.99% interest rate and will probably used that money to max out my Roth IRA, Roth 401k and open a taxable brokerage account.
Dave Ramsey's teaching are solid and they are not new! They have made me a millionaire!
I'm at step #7. Love your show.
Thank you, that was very useful! Seems like I do some of the steps already but not in the right order!
Recently found out about Dave so my steps are not quite in order, been paying extra on my house and retirement savings only at 9%, but I will be on step 5 with a few adjustments.
Thanks for watching!
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Rose do you have an opinion on Velocity banking and using that method to pay off different types of debt?
I got to step 2 easily..almost got thru it and then I moved for a job and I'm back at step one again....but I should have it done by this coming paycheck.
Hi Rose! Totally off topic...but that lamp is gorg!!! Is it yours? Where's can I get it from??
Excellent video! Thank you for keeping us financially savvy.
Hi Rose, nice video. Could you plz advise how is robo advisor of fidelity? Thanks
would love a video of what dave does right vs what he does wrong. His baby steps are iconic but he recommends investing in mutual funds as opposed to index funds.
The step I disagree with is paying of a home early.
I would invest what extra you would put on the home. Your investments compound up while inflation slowly reduces the adjusted dollar amount down of your mortgage.
Look at it like this, my parent's first home in the town that I grew up in had a mortgage of $236 per month. They got that loan in the late 1960's. Now, imagine that they put money in the bank or CDs or stocks or a mix of all three for even fifteen of those years. Can you imagine seeing money grow in an investment while your mortgage effectively becomes cheaper every year by the inflation rate?
$236 in the late 60's was a bit of money, lower middle to middle class, back then. Imagine how little $236 felt by the 1980s or 1990s or late 1990s when the note was 30 years old and gone.
But, if you still want to pay off the home early, I would still save/invest outside of the extra home payments then when you have enough to pay it off all at once, then do it or don't. That is cheap insurance and a risk reducer. Think about plowing money into a home and then you have a medical crisis and can't work or you lose a job. What if you only have your several months of savings / emergency fund built up. You can't exactly borrow against your home to get at your asset unless you have a job. You could lose a home if you get behind on payments when you may have been paying ahead for several years, then BOOM you get evicted and it gets auctioned off...and not for full value if you cleaned it up and sold it yourself.
Stuff like this is why I continue to follow you Rose. Thank you so much!
Loved this. Thank you for sharing!
ROSE ! We've missed you.
Omg yes welcome back Rose! You're the best :)
AGREEEEED!!! 🥳🥳🥳
Nice info. Curious..why are you holding a cup? Are doing a bit of marketing..we’re u gonna take a sip?
@@GroovJunki huh
@@xiloa23 u didn’t undersatand
Awesome video! Thank you Rose for your amazing knowledge and guidance about managing finances!!
Im glad you are back active on TH-cam. Loved your content as always ☺️
Love the break down, the hardest thing to do is start the process.