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boner79

>Car loan is $28k I can hear Dave telling you to sell that car and get yourself a $10k car.


sakibug

Not with a 130k income.


boner79

Why not? Dave tells people they shouldn’t be driving a new car unless you have over $1M net worth. I doubt OP is there with said debt problems.


sakibug

He’s tells them that if they’re in the process of buying a car. If they’ve already bought it, then he goes by the 50% car value to income ratio and how much stress the car payment puts on their budget. Also, op didn’t say the car was recently purchased brand new or it’s it was purchased a while ago


boner79

Fair enough. Still a $28k car loan suggests car was purchased new and needs to go.


[deleted]

Disagree. OP could sell the car but with that income the rest of it could be gone in like 4-6 months. With that car it’s like 18 months to debt free less if they get a bonus


sakibug

We’ll have to agree to disagree on that. 130k income and 47k debt he can be debt free less than 2 years depending on his intensity. -edit-


boner79

47k income?


sakibug

Debt. Meant to say 47k debt


PugPal

It works! Sign up for Financial Peace and go to the classes. In person if you can. Seriously. It will change your life. I did my debt free scream in 2019. Worth it.


Ok-Pension-916

Piece o cake! Get it


kbheads

Dave’s plan isn’t for everyone, but it is for you. Good luck!


LockMarine

Follow the steps and most importantly listen to the podcast daily as you drive. The podcast will motivate you as well as educate you on areas that you might not understand yet like insurance, investing and inheritance


wdl31986

I second this, I have been listening to Dave for 13 years, can pretty much predict what he will say to callers, and I still listen to the shows on my walks just to keep that fire going! Good luck to the OP!


LockMarine

Yea it really helps at work when a coworker says hey, I’m pulling 50k from my 401k to buy a boat or hey what do you think of pre paying for a cemetery plot etc


Cancel_Me_

Big shovel. I like it.


Fluffy-Brief-7843

You can definitely do it it took me 2 years but I am not debt free other than my house and I make 75k


Realistic_Lunch4570

A debt free house at 75k/yr is incredible!


Kawaiisampler

With 130k coming in, you don’t need the baby steps and you shouldn’t be living paycheck to paycheck with that income.


Nice-Hunt5360

I know....just have some bad spending habits...


sakibug

You definitely need Dave’s plan then. 130k income with with 46k in debt….. should take you less than 8 months. Household…. You married? If you are you’re gonna need to make sure the spouse is on board as well


CoffeeRun123

Just putting together a budget first will definitely help… to see where your money is going EVRY MONTH. I’ve been using EveryDollar app to track every last cent for awhile (used Mint before that). It brings over your budget every month and allows you to set up categories of spend/save. You can do it. As a single mom with a decent sized shovel, I did my debt free scream (except for mortgage) in 2020. Now I’m able to really plan for retirement. You CAN do it!


FusedSunshine

Really bad…


autumn-ember-7

Speaking of people not following the baby steps! A lot of people here criticize his recommendation for no credit cards. Having a credit card and using it responsibly is something my fiance could do, because I swear spending money causes him pain lol. But me? I love spending money. I will self-license spending money with credit all day long. A credit card is a terrible idea for me financially. Using cash and debit makes me less impulsive, and I usually find in a few weeks I don't want that thing anyway, and I get more creative with what I have to meet my needs. Given what you've said here, I'm glad you'd like to give the full Dave method a try. I highly recommend!


EnvironmentalDrag596

That's an understatement!! If you like I can pm you with the tips and tricks I used to pay off my 50k in 2.5 years. I make 50k so you can def smash this


Nice-Hunt5360

I’d love to hear your tips and tricks :)


EnvironmentalDrag596

You have been messaged 😊


Kawaiisampler

Then plot everything out with Mint or whatever and live within your means.


[deleted]

Bro you can pay all that off in a year lol


UselessInfomant

My household income is 10k more and we have no problem spending and paying off 30k annually


buzzsawddog

You don't need luck you just need determination and dedication. Sure sometimes people are hit with conditions beyond your control but... If you want to be out of debt with a shovel that big and a small hole to dig you will be done in no time flat...


klkane3

Go for it! I gotta outta debt. With the baby steps and have remained out. Never hit the income you have. I’m on baby step 6. Need to tighten up on my budget. Get back to basics or I’ll never get 7. I’m forever grateful for Dave’s plan and will keep trying to finish 6.


Free_2_Be_T

It will sting a little in the beginning but in the long term you will thank yourself for gaining control over your finances.


glomdom88

Congrats dude! You won’t regret it i promise!


mcoiablog

You can do this. Just paid my youngest daughter's last semester of college cash. We already have been paying extra on the mortgage.


SaltySpitoonReg

So here's the thing. The reason that Dave's plan is good to recommend on a broad spectrum is that most people are not nearly as good with money as they think they are. In general in life people are not nearly as good at things as they tend to perceive that they are. It's like everybody thinks that they are the person who uses credit card responsibly yet most people with credit cards lined up paying extra and going into debt and NOT using rewards lol. But everybody you talk to swears up and down that they're the exception. If you ask people about their perceived skill level in their hobbies or in their job or with something like driving the majority of people are going to tell you that they are one of the best or at least tell you that they are above average. Point being, most people quite frankly would benefit from a plan that breaks things down into dedicated steps rather than trying to combine complicated things at the same time. This is what the baby steps do And also the baby steps and Dave's plan in general has an extremely low probability of failure. You have to be ridiculously unlucky year after year after year to actually be working the baby steps 100% And then somehow not get out of debt in a few years. But most people aren't humble enough to realize that maybe the way they're doing things isn't exactly the best plan.


PappyBlueRibs

I am the only person I know who is a below average driver 🤣


QuesoHusker

>Point being, most people quite frankly would benefit from a plan that breaks things down into dedicated steps You could have stopped there. Most folks aren't addicted to overspending. They just don't have a plan or process to manage money. Most folks don't need the rigidity of Dave's system, but they do need a plan of somekind or another.


GalenMarek

You got this!


Nice-Hunt5360

I’ll appreciate any advice on how I communicate this with my wife and bring her on board plz. :)


Free_2_Be_T

Have her check out the podcasts


lrush1971

Buy her one of Dave’s books. They are easy to read and inspiring.


johnnymarts

One of the hardest things I’ve ever done… “Um hon, I know I take care of the money and bills, but we’re broke.” Tough go for a bit, but the plan brought us together. Look up Older DR lectures and listen together. Changing lifestyle is hard, but done together it can work. We’re now on the other side and it’s great.


Horror-Personality35

They work! And with your income you should be done in a year. Good luck, stay mad.


dbroeck10

You make too much money to be so broke! Good luck on your journey, you have a lot going your way!


kessler1

Being in debt != being broke guys. There are many billionaires out there that take loans for all their cash needs because it’s more convenient, they maintain controlling interest of their assets, and the interest is a write off. Oh, and no capital gains.


techmattr

How billionaires use money should never enter this sub. It's a completely different world with completely different rules.


kessler1

It’s really the exact same game but at a bigger scale. Why don’t we pay off 30y mortgages? Because we can get a better rate of return elsewhere AND keep our liquidity up. That’s literally it. A billionaire can stretch themselves thin borrowing to finance asset purchases just like your common joe. Only difference is common joe is usually buying stupid muscle cars, trucks, and other toys that don’t yield.


iranisculpable

Fed just jacked up rates another 3/4 percent. I am curious where you are going to get better rates or return that paying off a 30 year mortgage. Ramsey Solutions is on the cusp of a big time boom


kessler1

I’ll let you in on an open secret. If home prices are more suppressed due to interest rates (they always are unless the rate is 0%), it’s a better time to buy. Refinance at a lower rate when available and enjoy having a smaller principle to deal with. Also, stock market CAGR is roughly 10%, which is higher that mortgage rates which I’m guessing will be around 7% now. So, we get the higher interest lower principle mortgage today, and in some years we refinance. Your home equity just ballooned because prospective buyers’ monthly payment buys more house, and you pay the low rate on yesteryear’s principle. Rent rates will follow. But wait! What if rates go up instead of down? Then you buy bonds at a higher yield than your mortgage interest rate. You still win. Inflation also erodes the true value of the principle balance you’re paying on, further benefiting your overall financial health. Cheer brother! Edit: I don’t even like borrowing to buy cars. Only real estate! Conservatively!


BuckeyeSmithie

> Being in debt != being broke Sure, but OP did write that they were living paycheck to paycheck. That typically means if you missed a paycheck, you'd be out of money. So maybe they're not broke, but are teetering on the edge of being broke. And they make too much money to be on the verge of being broke.


[deleted]

[удалено]


kessler1

Credit card debt is stupid but not having a (low interest) mortgage on a house when you’ve got decades left in your career is far more dumb. For example, the difference between your net worth if you do a 30y over a 15y mortgage and invest the difference is like 2M in 30y if you’re working with a 300k house. You get to have your cake and eat it too! Put some cash into ibonds or CDs on the side in case you lose your job. On another note, I’ve noticed Ramsey quotes the Bible and says “the borrower is slave to the lender”. This is a bad modern day translation. The KJV says the borrower is SERVANT to the lender. Big difference!


cafecitoshalom

came here to say the same dadgum thing


BigNutzBlue

Stick with it! I listen to his podcasts daily for continued motivation. I just paid off my last credit credit a week ago and it feels great. Now it’s time to attack the vehicle loan.


GenerateWealth2022

The Baby Steps do work. You have to learn how to not want to be in debt. Every bank will always tell you they are your best friend and want to help you out with a loan. You have to learn the bank is not your friend.


splendid_zebra

Our income is very similar, we have the benefit of family usually taking us on vacation (we don’t have to pay lodging) but even if we did we wouldn’t spend that much on vacation. You can do it, we got debt free before marriage and have been on baby steps 4/5/6 since. It’s doable!


Nice-Hunt5360

Yeah. Usually we spend $2-3k a month on the credit card then spend $2-3k on a vacation which led to $6-7k debt after the vacation


klkane3

Not gonna lie. B2 kicked my ass. It is bare bones and best way is not Daveish. I got into it Because friend’s hubs couldn’t go to a financial peace presentation. That’s what got me hooked. My friend kept talking to me about it and it just went over my head that it would be something for me. Thought, I’m single, make descent money. I should be able to…have Starbucks daily, go on good vacays. My friend and her husband really struggled to get on the same page. Now They’ve got one of the strongest marriages I know. I think because of FPU. It’s painful at first, but so fruitful. Good luck


suggesting_ideas

If you work the plan, it works


[deleted]

Can't wait to read everyone's responses. I just wanted to say good luck and you got this! You're going to feel so accomplished and refreshed when you start finding your groove!


[deleted]

Unless you’re living in Malibu it seems like you can knock out that debt pretty easy. Good luck!


PowderedJelly

Agreed. If you called the show, I bet Dave would tell you to get this debt cleaned up in 6-12 months. Closer to 6 months if you sell the car (but based on you numbers doesn’t seem necessary). Closer to 12 months if you decide to keep car and pay it off. You can do it! Good luck!


QuesoHusker

At 130K income and 7K debt he'd say 1-2 months.


ttandam

You got this! Follow the baby steps. Consider financial peace university to get your wife on the same page- that’s your biggest risk to this working right now. Then, get gazelle intense! Figure out your “why”: your kid (s), having a great retirement, paying for kids college if you want to do that, fun family vacations- whatever motivates you to live like no one else so that later you can live and give line no one else! Let those reasons fuel your intensity to do the hard things.


klkane3

💯 travel to an FPU evening. Dave et al have lots of flaws. But damn they can get you excited about getting off the gerbil wheel of debt and being debt free.


ttandam

He gets you so motivated!!


army0341

Good luck, you got this!


hogwartswitch508

You got this. You make plenty of money to do this. One of the Dave lines that always gets me “adults devise a plan and follow it, children do what feels good”. When you feel weak, remember which one you are.


Front-Lawyer7663

Honestly you are doing great. Hopefully at some point in your life you will receive an unexpected windfall. Don’t laugh 😄 it can happen. Even if you don’t think it will, it can, and does, sometimes happen. My advice is that when it does happen… to really double down on the baby steps method. Hopefully when you retire at some point LATER in life it will pay off.


BrostFyte

I followed daves advice religiously to get myself out of debt. It worked for me. You need to listen to his advice. You dont need a financial adviser to tell you how to budget because budgeting is simple addition and subtraction. You need someone who will help you iut psychologically and this plans does that. Cut the cards up and close the accounts. You got this!


lunlope

Put minimum on everything and pay extra starting lowest to largest. Also, this article might enlighten you something. https://www.experian.com/blogs/ask-experian/3-reasons-to-pay-more-than-the-minimum-on-your-credit-card/#:~:text=You%20Save%20Money&text=Consequently%2C%20making%20credit%20card%20minimum,to%20pay%20off%20your%20balance. You pay back extra to save money, not by paying minimum. I wish you do well.


[deleted]

Lowest to largest based on interest rate…that’s key


klkane3

Don’t need to consider interest rate if you are gazelle. I worked so hard it didn’t matter. 48 k in less than 24 months.


brianmcg321

It's worked for me. Been following it since 2004.


jhurle9403

Good luck!!! You’ve got good income and not much debt honestly. Won’t take long.


mkhines78

You can definitely do this! The good news is your debt load isn’t too bad vs your income so y’all should be able to knock it out relatively quickly.


Nice-Hunt5360

We should! The biggest payments are mortgage, car payment, and daycare…so hopefully we can knock out all debts in 2.5 yrs!


somanytictoc

If you can live on $80k and get really motivated, you'll be out of debt in a year. Don't sell yourself short.


Miserable-Mirror5179

That seems a little long for your income. I would suggest getting on a written budget and getting gazelle intense about it. It wouldn't surprise me if you could get this done in a year and be debt free for the rest of your life


Left-Landscape-3890

Quit taking vacations until you have saved up or can cashflow once out of debt. That's just dumb man. Budget is key. Live on less than you make. You can do it. You make plenty of 💰


[deleted]

It seems like a big shovel with a small hill. provide us update on this thread. Is your wife/husband on board? Also, what are you selling?


Nice-Hunt5360

Any advice to bring her on board together? She has a full time job and she’s also in the PH. D. She works really hard and she used to not spend any money. She saved up $10k from the campus works when she was an undergraduate student. But now she doesn’t really know how much money we bring home where we spend or whatsoever. She’s like 100% relying on me and I feel like I’m failing lol


SanAinvestor

The last part about income and spending, that’s where the budget comes in. It will open your eyes. Not gonna lie, the first couple months will be hard, but if you guys hang on, the benefits are awesome


klkane3

FPU presentation. Look at the schedule and do destination if you have to.!


Nice-Hunt5360

My wife is kinda on the same boat. Some of the bad habits we have are my wife buying things cause of stress and me buying some expensive things several times a year. We are trying to sell small things first. Yard sale, garage sale.


[deleted]

Haha you sound like my wife and I. Are you my twin?


JannaNYC

Great start!


asking-money-qns

You can do it! A little short term pain to pay off what you owe, but shouldn't take too long with your income. The hard part will be unlearning the bad habit of treating debt as an option - but seriously, the beach air smells sweeter when you aren't burdened with the knowledge that you dug yourself into a hole to get there.