Total Money Makeover - Baby Step 6I’ve written extensively about Dave Ramsey’s baby steps here on Money Q&A. You can see my overview of Dave Ramsey’s baby steps system from his book, The Total Money Makeover. There are seven baby steps that you should follow in order that will lead you to financial peace that he discusses in his book which is one of the Top Ten Personal Finance Books of all time that you should be reading. Dave Ramsey’s baby steps are…

Baby Step 1 – $1,000 Emergency Fund
Baby Step 2 – Pay Off All Of Your Debt With A Debt Snowball
Baby Step 3 – Fully Fund Your Emergency Fund
Baby Step 4 Save 15% Of Your Income For Retirement
Baby Step 5 – Save For Your Children’s College Education
Baby Step 6 Pay Off Your Mortgage Early
Baby Step 7 – Build Wealth And Give

The seventh and final baby step in Dave Ramsey’s The Total Money Makeover is to build wealth and give. Here’s a breakdown of baby step 7.

Dave Ramsey’s Baby Step 7 – Build Wealth and Give

Winston Churchill once said, “We make a living by what we get, but we make a life by what we give.” In other words, trying to make money so we can get by and afford the things we need and want is a normal part of living, but for a truly meaningful life, giving to others can be transformative.

Dave Ramsey’s Baby Step 7 - Build Wealth and Give

The point of building wealth isn’t just to stockpile enormous amounts of money for your own benefit. Instead, building wealth should incorporate more charitable giving to help you leave a positive legacy in your community and the world at large. Nobody will remember much about your investments when you pass away, but many people will remember how you donated time and money to needy individuals and organizations. I’ve also talked multiple times about why I’m a big fan of giving back to your alma mater

If this sounds like a legacy you’d like to leave behind, here are a few tips for building wealth and giving back to others who truly need it:

Giving Brings Happiness

Did you know that Harvard University researchers found that money can buy happiness? Interestingly enough, this psychological study found that increased rates of happiness were expressed primarily by folks who had given money to others, rather than using that money on themselves.

Even instances of giving as little as $5 to someone else showed a small boost of happiness and well-being for the giver, which means that giving money to others who need us could be a win-win situation. [click to continue…]

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As a young family, it’s important that you’re making the best decision for your future and the future of your loved ones. When you’re dealing with your finances, it can be confusing navigating all of the different options.

Money Mistakes to Avoid

There are many reasons to sell mutual funds.There are a couple of money mistakes that you could be making that are easy to fix, but will have an enormous impact on your family’s finances. Fixing or even staying away from these money mistakes will help lay the foundation for a secure future.

Not Budgeting

The most common money mistake that families are making are not budgeting their money. When you think of budgeting, you probably imagine your parents or grandparents sitting down with all of their bills and writing them down in an old notebook. But, it doesn’t have to be as painful as that. There are several websites and apps that you can use to make a budget as simple as a few clicks.

One of the best apps for creating a budget is Personal Capital. After you’ve created your Personal Capital account, all you have to do is link your bank accounts and credit cards, and Personal Capital will display all of your account information and recent transactions. Not only that, but the app will categorize all of your purchases into the appropriate sections. This makes it easy to see how much you’re spending on certain categories and identify areas where you can cut back on your spending.

If you don’t know where your money is going, you could be overspending thousands of dollars every month. Because it’s so easy, there is no excuse to not have a budget.

Not Having Insurance

Another common money mistake is nothing have quality insurance plans in place. Buying insurance is not the most fun purchase that you can make, but it’s one of the most important. Life insurance is one of the insurance policies that families typically skip buying, which could be one of the worst mistakes that you could ever make for your loved ones.
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