Dave Ramsey, TMMO and FPU?

Question

I read the TMMO book in Sept and enrolled in FPU class a week ago. I can't wait till spring to have a "real honkin' " garage sale.

When snowballing Dave indicates keep making minimum's snowballing off the smallest 1st rather then doing the highest interest 1st. Can someone who has gotten through their snowball explain the why of doing it that way?

I wish our politicians would be required as part of their oath of office to commit to a full blown TMMO plan for our gooberment..

Answer 1

First, let me tell you that the snowball debt elimination is a tried and true method. Dave Ramsey didn't invent this method but he cleverly packaged with his books, his classes, his websites in such way that you really want to do it!!!!!!!

It's psychological really: list your debts from smallest balance to the largest, pay off the mimimum monthly balance. When you kill that first debt, you feel so good about it, it gives you this feeling of empowerment and hope over your debts and the will to go on and do it until they're all gone! Once, the first debt is killed, you add that minimum payment to the second debt, and so on.

Since you already enrolled in a FPU class, you will have all the required tools to achive your goals!

Answer 2

Dave Ramsey Tmmo

Answer 3

It felt GREAT getting those little pesky bills out of the way when we started the debt snowball! Psychologically you need to keep motivated. Everything in our society is "now" (instant gratification) and getting out of debt isn't but you can make it close to it by doing the smallest to the largest debt to keep yourself motivated.



I have done the calculations on our debt using crown.org software and an amortization website and the difference of time to pay off highest interest verses lowest balance first was a couple months. Not a big amount of time was "saved."



You can do it and keep on snowballing :-)

Answer 4

We're probably going to put most of it into the emergency fund to take it from the 3 month end more towards the 6 month side.

Answer 5

you pay lowest debt first to gain momentum, to have a few small successes to keep you motivated. And that frees up more money for the larger debts.



just ignore interest, pay lowest debt to largest... it works.



follow the baby steps in order.