Book Review: The Total Money Makeover
Dave Ramsey’s Plan to Reduce Debt and Improve Money Management
Jun 29, 2008
Dave Ramsey is passionate about helping others to reduce debt and start on the path to financial security. His own early experiences in what he confesses to be the mismanagement of his income and denial when things started to go wrong, have fuelled his desire to help others avoid the pain of bankruptcy and ever increasing debt.
The Total Money Makeover
Ramsey’s first financial guide, Financial Peace (Viking, 1995), offered readers saving and investment principles to improve their approach to their finances. The Total Money Makeover (Thomas Nelson, 2003) recaps those principles and offers readers practical strategies to utilise them in their everyday financial decisions.
Before providing readers with practical tools to improve their financial situation, Ramsey discusses the financial myths, flawed reasoning and harmful attitudes that lead to problems with excessive debt and overspending. Throughout the book there are testimonies by those who have applied Dave Ramsey’s theories to improve their financial situation.
Accompanied by The Total Money Makeover Workbook (Thomas Nelson, 2003) The Total Money Makeover offers a comprehensive list of strategies and skills that will equip individuals and families to reduce their debt and better manage their income.
Money Management Tools
The Total Money Makeover offers practical tools and advice for paying off mortgages, investing for retirement and providing for college and education expenses. Ramsey recommends establishing an emergency fund as a priority to ensure that unexpected future expenses do not derail plans for financial security and put previous investments at risk.
The Total Money Makeover includes a variety of budgeting templates including:
- Consumer Equity Sheet
- Monthly Cash Flow Plan
- Allocated Spending Plan
- Pro-Rata debts
The Total Money Makeover Workbook provides additional templates, charts and questionnaires to assist individuals in assessing their current financial health and establishing a savings and debt reduction plan.
A Philosophy of Better Money Management
Adopting Ramsey’s financial perspective involves more than making changes in money management practices. It requires developing an entirely new attitude to money and debt. His mantra ’If you can live like no one else, later you can live like no one else’ encourages readers to establish an attitude of short term self-denial contrary to society’s constant push for possession at all costs.
He advises that if an individual is able to restrict purchases in the short term, buying only what they can truly afford, then the long term benefits will be a financially secure and sustainable lifestyle.
Ramsey’s Christian faith and motivation are mentioned but in no way dominate what is essentially a practical and common-sense guide to money management.
Dave Ramsey
After experiencing the loss of a 4-million dollar real estate portfolio, Dave Ramsey researched the keys to better financial security and returned to a more basic philosophy of personal finance.
His desire to help others achieve financial freedom has led him to author his New York Times bestselling book Financial Peace and host the nationally syndicated The Dave Ramsey Show. Through his books, website, program and various other initiatives, Ramsey seeks to help individuals and families establish a financial philosophy that will enable them to live the life they desire free from the stress of debt.
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