A couple of years ago, I was in the process of buying my first house and marrying my fiance. I was going through a lot of life changes and making some huge financial decisions. I felt like I’ve always been somewhat good with handling money but wasn’t doing the best I could by any means. I knew I needed to up my game when it came to personal finance so I started looking things up.

My parents live in a very rural area so before I got my own house, I was driving 30 minutes one-way to get anywhere. As a result of being on the road for usually an hour or two a day, I started listening to a lot of radio. For a few months, I listened to Clark Howard’s show and that was the only source of personal finance information I was taking in.

When I was a teenager, my parents bought a Dave Ramsey course and had me go through it. It was interesting, but after a few years I didn’t remember much of what I was taught. Thinking of the course, I looked Dave Ramsey up to see if he had a podcast. I started listening to him and noticed he was a lot more brash than Clark Howard but seemed to have a more structured plan to follow.

Soon after I began listening to Dave, I started getting addicted to his show. I started listening while at work and probably averaged about 5-6 hours a day (there was a lot of older episodes I listened to). I got super motivated by all the people calling in that had paid off a boat-load of debt and seemed to be killing it with their financial situations.

Dave has a path to financial freedom that he calls “the baby steps”. The steps are:

  1. Save a $1,000 emergency fund.
  2. Pay off all debt other than your mortgage if you have one.
  3. Beef up your emergency fund to 3-6 months of expenses.
  4. Start saving 15% towards retirement.
  5. Save for your kids college.
  6. Pay off your home.
  7. Maximize your wealth and give back.

I got hooked on the steps and since my new wife and I didn’t have any debt, we were able to jump right to step 6 and start paying extra towards our house. We definitely didn’t go as hardcore as we could have but having no debt, an emergency fund, saving 15% and paying extra on our house is a lot more than most 23 year-olds do.

I’m really grateful for the knowledge I got from listening to Dave every day. I feel like following his steps really helped us to get our finances in order, early on in our lives. By refusing to go into debt for anything other than our house, we avoided a lot of interest payments.

I’ve implemented a lot of good things in my life since starting to listen to Dave that I may not have done otherwise. Here’s what I’ve started doing since listening to him:

  1. Saved an emergency fund.
  2. Boosted my retirement savings.
  3. Been more conscience of what I’m spending my money on and started using a budget.
  4. Advanced in my career. (He’s good about motivating people to do their best at work).
  5. Reading more. Dave loves to promote reading since he’s written a couple of books.

I’m sure there are other things I’ve started doing since listening to Dave that I don’t even realize.

After listening to his show every day for over a year, I could literally fill in for Dave if he needed me to. I got to the point where I new how he was going to answer every question that was thrown at him. His methods are very simple so it’s easy to catch on quickly.

Now that I’ve been researching personal finance for a couple of years, I realize that Dave’s advice is great for the masses but at the end of the day, his steps are exactly what he calls them: “baby steps”. He treats his callers like babies most of the time. While this can make for entertaining radio, I’ve realized I could get much deeper into the topic of personal finance by following other people such as Mr. Money Mustache.

I missed out on a lot of savings from strictly following Dave’s advice. If you’re a true Dave follower, you know he says that credit cards are evil and you aren’t allowed to have them. I ended up closing all my credit cards and looking back on it, that was a mistake. If you’re disciplined and only use a credit card for purchases you would have made anyways, you can save a lot of money in the long run.

Dave likes to say “I’ve never met anyone that became wealthy from their rewards cards”. While this may be true, it’s beside the point. You aren’t truly optimizing your financial situation if you’re leaving all the savings from credit cards on the table. I recently got back in the credit card game and should get a few hundred dollars back this year by using it for as many purchases as possible. You can also use credit cards as a way to travel for free if you can learn how to hack them.

Another thing I disagree with Dave on is which vehicle to use for retirement. He’s always touting about mutual funds and how you can expect to get 10-12% returns on your investments. He even has a feature on his website where he refers financial advisers in your area. The thing about financial advisers is, you have to pay them a percentage of your earnings which could literally cost you hundreds of thousands of dollars in the long run. I suggest using low fee vanguard funds and just doing it yourself.

Lastly, I disagree with Dave on how much you should save for retirement. 15% is a good place to start but I suggest saving as much as you possibly can. Chances are you can save 50% of what you make and still live comfortably. Dave doesn’t seem to be in with the FIRE crowd and mostly talks about retiring at the traditional age of 65. Not that I don’t want to work but I plan to hit FI at least by age 40 so that I’ll still have most of my life to devote to things I really want to do.

At the end of the day, I really started my personal finance journey by listening to Dave and would still suggest his program as a starting point. I don’t know of a way I could calculate the financial impact that listening to Dave has had on my life but it could potentially be millions over the course of my life. So if you don’t know much about finances already, start with Dave and then dive deeper once you’ve got his methods down.

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