Book Review: Dave Ramsey’s The Total Money Makeover
Dave Ramsey’s The Total Money Makeover presents a motivational piece on the working of specific business investments. Throughout the book, Dave is a proponent of the ‘no debt” philosophy that requires people only to use cash to purchase items. While this philosophy contracts the loan path chosen by some successful entrepreneurs in the contemporary corporate world, it still gives substantial insight in building financial wealth and freedom. Rather than seeking a loan, an entrepreneur should save an emergency fund, clear all debts, create another emergency fund, and then save to purchase products. The book addresses four key concepts: psychological hurdles that people should overcome to build their finances, the actual process of creating the financial foundation, the steps of building wealth, and what to consider when making the decision of buying or not buying.
The psychological hurdles covered in the book include denial, debt myths, money myths, ignorance, and “keeping up with the Joneses.” According to Dave, the journey to financial freedom should begin by acknowledging your financial problems. Money should then be considered as a mere tool and nothing more. Dave rightly states that sitting down, identifying your issues and needs, and planning how to solve them instead of imitating others is the only guaranteed way of avoiding ignorance. Dave then identifies developing a budget, ensuring that all your accounts are current, quickly building a $1,000 emergency fund, paying all the debts besides the home, building a ‘real’ fund, and saving for real purchases as the steps for creating a financial foundation. Dave’s frequent quoting of Bible verses to illustrate key points throughout the book is somewhat fascinating. Nevertheless, the book offers sound advice on building your finances and ‘acting your income.’