Total Money Makeover which has always really appealed to me. By "appealed to me," I mean that it usually gives me chills. The good kind.
I suspect that a fair amount of its appeal for me derives from the way Dave narrates it in the audiobook version. There are a few things I hold against Dave, but his abilities to storytell and motivate aren't among them. The man is a performer and motivator, no question about it. But who cares — I'm still going to post the little story here, because ... well, because I feel like it:
First, let me tell you that mortgage debt is the only kind of debt I don't yell about. I want you to pay off your home as part of your Total Money Makeover, and, for all the reasons stated in the previous pages, you have to be very careful. When asked about mortgages I tell everyone never to take more than a fifteen-year fixed-rate loan, and never have a payment of over 25 percent of your take-home pay. That is the most you should ever borrow.
I don't borrow money — ever. Luke called me from Cleveland to tell me that some of our listeners and readers are doing what Sharon and I have done: "The 100 Percent Down Plan." Pay cash. Most people don't think it can be done. Luke did it.
Luke made really good money. His income at twenty-three years old was $50,000, and he married a young lady making $30,000. His grandfather had preached to him never to borrow money. So Luke and his new bride lived in a very small apartment over a rich lady's garage. They paid only $250 a month for it. They lived on nothing, did nothing that cost money, and they saved. Man, did they save! Making $80,000 in the household, they saved $50,000 a year for three years ... and paid cash for a $150,000 home. They closed on the home on Luke's wife's twenty-sixth birthday. If you make $80,000 per year and don't have any payments, you can become very wealthy, very quickly.
Keep in mind, though, that Luke's friends and relatives thought he should be committed. They made fun of his cars, his lifestyle, and his dream. Only his bride ... and his grandfather ... believed in his dream.
Who cares what the broke people think?
I don't borrow money — ever. Luke called me from Cleveland to tell me that some of our listeners and readers are doing what Sharon and I have done: "The 100 Percent Down Plan." Pay cash. Most people don't think it can be done. Luke did it.
Luke made really good money. His income at twenty-three years old was $50,000, and he married a young lady making $30,000. His grandfather had preached to him never to borrow money. So Luke and his new bride lived in a very small apartment over a rich lady's garage. They paid only $250 a month for it. They lived on nothing, did nothing that cost money, and they saved. Man, did they save! Making $80,000 in the household, they saved $50,000 a year for three years ... and paid cash for a $150,000 home. They closed on the home on Luke's wife's twenty-sixth birthday. If you make $80,000 per year and don't have any payments, you can become very wealthy, very quickly.
Keep in mind, though, that Luke's friends and relatives thought he should be committed. They made fun of his cars, his lifestyle, and his dream. Only his bride ... and his grandfather ... believed in his dream.
Who cares what the broke people think?
And cue the chills. I hear that story, and oh how it makes me wish I could go back in time and erase the multitude of stupid things I did with my money in my early 20s. Gads. Mid-twenties couple, making $80k per year, and no house payments. Wow.
Ask any eighty-year-old if five years of sacrifice is worth it to change your financial destiny for the rest of your life! Ask any eighty-year-old if five years of sacrifice is worth it to have the satisfaction of knowing you changed your family tree. Paying cash for a home is possible, very possible. What's hard to find is people willing to pay the price in sacrificed lifestyle.
I'll be entirely honest: For me, at twenty-three years old, even if Dave's book had been in my lap, I doubt if I'd have been willing. Heck, look at my last car purchase — I'm 34, and I'm not willing now. Sad, but true. I've come a long way ... but not that long, apparently.
Anyhow, I think that's a great story, particularly if you're in the midst of making some tough sacrifices now in anticipation of some lofty goal(s) down the road. The payoffs can be downright astounding.
Oh well ... then there's me, and my underachieving self. Me, and my fifteen-year, fixed-rate mortgage, with a payment that's well beneath 25 percent of my take-home pay.
At least in that regard, I'm within Dave's house-payment guidelines, right?
Plus I can sleep at night.
Labels: Dave Ramsey, Debt, Homeownership, Mortgages
