Shortly after purchasing our dream home in 2006, I was in total disbelief! How in the world did I get my family into this financial quandary? Overhead and expenses galore! The only word that comes to mind is IDIOTIC!
On the surface, I thought we were living the American dream. We have a big house on a golf course. Own multiple cars. Have high-paying jobs. Life is flawless … Right? Nope! Underneath all the glitz and glamour is a stack of cards that may collapse at any moment when the wind blows. Ouch.
What’s ironic is I had no idea of the financial severity we were in! Luckily, I went on a business trip to Atlanta, GA. This is where I stumbled onto the teachings of Dave Ramsey. He’s the author a book, entitled “Total Money Makeover”. Without exaggeration, this book altered the trajectory of my family’s financial future.
The “Total Money Makeover” book laid out 7 concrete steps for getting and staying out of debt:
- $1,000 In An Emergency Fund
- Pay Off All Debt With The Debt Snowball
- 3 to 6 Months Expenses In Savings
- Invest 15% Of Income Into Roth IRAs and Pre-Tax Retirement Plans
- College Funding
- Pay Off Your Home Early
- Build Wealth and Give
After reading, I realized I was financially illiterate. I thought it was cool to purchase the biggest house or purchase the most expense car the bank would approve. I thought it was cool to carry student loan or credit card debt by paying the monthly minimum. After all, isn’t this what everyone is doing (I’m being sarcastic)? Because this approach was implemented, we were over leveraged with debt. Terrible!
During this period, I was very angry with myself. May family was in financial jeopardy. For the next 30 days, I read books, listened to podcasts, spoke to mentors and prayed. I was desperately searching for implementable ideas to generate supplemental income, as I was stressed beyond belief!