The Total Money Makeover

by Dave Ramsey

Troy Shu
Troy Shu
Updated at: March 04, 2024
The Total Money Makeover
The Total Money Makeover

What are the big ideas? 1. The Total Money Makeover focuses heavily on changing behavior as the key to financial success, rather than just relying on head knowledge

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What are the big ideas?

  1. The Total Money Makeover focuses heavily on changing behavior as the key to financial success, rather than just relying on head knowledge (Chapter Introduction). This approach is unique because it recognizes that personal finance is largely influenced by habits and emotions, making a commitment to improving one's own behavior essential for lasting change.
  2. The book openly discusses spiritual aspects of money as an integral part of achieving financial peace and freedom. While some may find this incomplete or unnecessary, the author believes it is vital for addressing the emotional side of money management and helping people overcome denial and obstacles (Chapter What This Book Is NOT).
  3. The Total Money Makeover advocates a specific process-driven approach to managing money, from building an emergency fund and eliminating debt to investing in retirement and giving generously. This step-by-step method is distinctive as it offers a clear roadmap for achieving financial freedom (Chapter 5).
  4. The book debunks common myths about money and debt, providing accurate and practical information to help individuals take control of their finances. For instance, it challenges the idea that debt consolidation solves the underlying problem of overspending or that you need a high income to get out of debt (Chapter 4).
  5. The Total Money Makeover emphasizes the importance of community and support in achieving financial success. By sharing inspiring stories of people who have followed the plan and experienced life-changing results, the author encourages readers to seek guidance from trusted resources and experts, build a network of like-minded individuals, and share their own progress with others (Chapter Meet The Winners of The Total Money Makeover Challenge).

Chapter Summaries



  • Personal finance is 80% behavior and 20% head knowledge
  • Change your life to get out of debt, give, and invest
  • The Total Money Makeover plan is successful because it focuses on changing behavior
  • The process is simple, inspiring, and based on common sense principles
  • Millions have followed this plan and experienced life-changing results.

What This Book Is NOT


  • This book is simple and uncomplicated, not sophisticated or complicated.
  • The author has not invented new ideas about money but packaged time-honored information into a process.
  • The book does not mislead about investment returns; 12% is achievable with good growth stock mutual funds over the long term.
  • The author's credentials come from personal experience and success in applying these principles.
  • The book openly discusses the spiritual aspects of money, making it incomplete for some but necessary for behavior change.
  • The author is confident that this material works based on millions of lives changed.
  • This book is different from the author's other books as it is a process-driven work.
  • People who follow the plan report life-changing financial freedom, with no complaints from those who do it.


“Aristotle once said, “To avoid criticism say nothing, do nothing, and be nothing.”

“My grandmother used to say, “Those convinced against their will are of the same opinion still.”

Meet The Winners of The Total Money Makeover Challenge


  • Couple, Chance and Kimberly Morrow, paid off over $56,000 in debt in a year using Dave Ramsey's Total Money Makeover plan
  • Stopped using all credit cards and set a goal to pay off $10,000 in debt that first year
  • Sold their home with equity to become debt-free and save for six-month emergency fund
  • Epiphany led them to win The Challenge contest and receive $50,000 grand prize
  • Used part of the prize money for church, celebration, and down payment on a house
  • Chance became a Christian and reunited with long-lost son during their journey
  • Four years after starting Total Money Makeover, they were debt-free at age 40
  • Share their story to inspire others to achieve financial peace and live within their means.

The Total Money Makeover Challenge: Feeling Lost and Afraid


  • I felt overwhelmed by debt and lack of control over my finances, leading to fear and hopelessness.
  • My debt prevented me from reaching financial goals like sending kids to college or retiring.
  • I needed a change and set out on a quest to learn how to manage money effectively.
  • Realizing that my money problems stemmed from myself, I focused on improving my own behavior and gaining confidence in handling money.
  • The Total Money Makeover is 80% behavior and 20% head knowledge, requiring commitment and hard work.
  • Tens of thousands of ordinary people have used the system to get out of debt and build wealth.
  • Living below your means and saving for future goals are crucial components of financial success.
  • The first step in the Total Money Makeover is confronting and controlling your own spending habits.
  • It will take sacrifice, discipline, and commitment, but the payoff of financial freedom is worth it.


“Winning at money is 80 percent behavior and 20 percent head knowledge. What to do isn’t the problem; doing it is. Most of us know what to do, but we just don’t do it. If I can control the guy in the mirror, I can be skinny and rich.”

“IF YOU WILL LIVE LIKE NO ONE ELSE, LATER YOU CAN LIVE LIKE NO ONE ELSE. This is the motto of your Total Money Makeover. It’s my way of reminding you that if you will make the sacrifices now that most people aren’t willing to make, later on you will be able to live as those folks will never be able to live.”

“We enjoy earning interest now, rather than paying it.”

“Savings without a mission is garbage. Your money needs to work for you, not lie around you.”

Denial I’m Not That Out of Shape (Two Major Obstacles to Your Total Money Makeover)


  • Recognize denial as a major obstacle to financial fitness and facing the reality of your financial situation.
  • Understand that debt consolidation only treats the symptom, not the root cause of financial problems.
  • Identify personal obstacles to achieving financial fitness and take action to overcome them.
  • Break the cycle of living beyond means and start paying yourself first.
  • Don't wait for a crisis to motivate you to make changes; act now.
  • Be aware of the danger of gradual financial decline and the importance of taking steps to improve your situation.
  • Seek out resources like The Total Money Makeover plan to help guide you towards financial freedom.


“For your own good, for the good of your family and your future, grow a backbone. When something is wrong, stand up and say it is wrong, and don't back down.”

“Years ago, in a motivational seminar by the master, Zig Ziglar, I heard a story about how mediocrity will sneak up on you. The story goes that if you drop a frog into boiling water, he will sense the pain and immediately jump out. However, if you put a frog in room-temperature water, he will swim around happily, and as you gradually turn the water up to boiling, the frog will not sense the change. The frog is lured to his death by gradual change. We can lose our health, our fitness, and our wealth gradually, one day at a time. It might be a cliché, but that’s because it is true: The enemy of “the best” is not “the worst.” The enemy of “the best” is “just fine.”

“Change is painful. Few people have the courage to seek out change. Most people won’t change until the pain of where they are exceeds the pain of change.”

“If you keep doing the same things, you will keep getting the same results. You are where you are now financially as a sum total of the decisions you've made to this point.”

“Albert Einstein said, “Great spirits have often encountered violent opposition from weak minds.”

Debt Myths: Debt Is (Not) a Tool


  • Debt is not a tool for prosperity but a hindrance to financial peace and wealth accumulation.
  • Credit cards are a dangerous financial tool that can easily lead to debt and financial ruin.
  • Living beyond your means by using debt to purchase items you cannot afford will only result in a life of financial stress and struggle.
  • Consolidating debt into one payment does not solve the underlying problem, which is overspending and living beyond your means.
  • Borrowing against your home to pay off debt is not a wise decision, as it leaves you stuck in the house and with even more debt.
  • The economy would prosper if everyone lived within their means and did not use debt, instead focusing on saving, investing, and giving.


“It is human nature to want it and want it now; it is also a sign of immaturity. Being willing to delay pleasure for a greater result is a sign of maturity.”

“I have heard it said that if you tell a lie often enough, loudly enough, and long enough, the myth will become accepted as a fact. Repetition, volume, and longevity will twist and turn a myth, or a lie, into a commonly accepted way of doing things. Entire populations have been lulled into the approval of ghastly deeds and even participation in them by gradually moving from the truth to a lie. Throughout history, twisted logic, rationalization, and incremental changes have allowed normally intelligent people to be party to ridiculous things. Propaganda, in particular, has played a big part in allowing these things to happen.”

“Debt is so ingrained into our culture that most Americans cannot even envision a car without a payment, a house without a mortgage, a student without a loan, and credit without a card. We”

“Proverbs 22:7: “The rich rule over the poor, and the borrower is slave to the lender”

“If you want to be skinny, study skinny people, and if you want to be rich, do what lots of rich people do, not what some mythsayer says to do.”

“If I loan money to a friend or relative, the relationship will be strained or destroyed. The only relationship that would be enhanced is the kind resulting from one party being the master and the other party a servant.”

“We buy things we don't need with money we don't have to impress people we don't like.”

“If you had saved $20 per week for just ten weeks, you could have bought the scratch-and-dent model off the floor at the same Rent-to-Own store for $200! Or you could have bought a used set out of the classifieds or online. It pays to look past the weekend and suffer through going to the Laundromat with your quarters. When you think short term, you always set yourself up for being ripped off by a predatory lender. If the Red-Faced Kid (“I want it, and I want it now!”) rules your life, you will stay broke!”

“we buy things we don’t need with money we don’t have in order to impress people we don’t like.”

“If you keep a $495 car payment throughout your life, which is “normal,” you miss the opportunity to save that money. If you invested $495 per month from age twenty-five to age sixty-five, a normal working lifetime, in the average mutual fund averaging 12 percent (the eighty-year stock market average), you would have $5,881,799.14 at age sixty-five. Hope you like the car!”

“You have to reach the point that what people think is not your primary motivator. Reaching the goal is the motivator.”

“Having seen several hundred lease agreements entered into by people I have counseled, my financial calculator confirms that the average interest rate is 14 percent. Shouldn’t you lease or rent things that go down in value? Not necessarily, and the math doesn’t work on a car, for sure. Follow me through this example: If you rent (lease) a car with a value of $22,000 for three years, and when you turn it in at the end of that three-year lease the car is worth $10,000, someone has to cover the $12,000 loss. You’re not stupid, so you know that General Motors, Ford, or any of the other auto giants aren’t going to put together a plan to lose money. Your fleece/lease payment is designed to cover the loss in value ($12,000 spread over 36 months is equal to $333 per month), plus provide profit (the interest you pay). Where did you get a deal in that? You didn’t! On top of that, there is the charge of 10 to 17 cents per mile for going over the allotted miles and the penalties everyone turning in a lease has experienced for “excessive wear and tear,” which takes into account every little nick, dent, carpet tear, smudge, or smell. You end up writing a large check just to walk away after renting your car. The whole idea of the back-end penalties is twofold: to get you to fleece/lease another one so you can painlessly roll the gotchas into the new lease, and to make sure the car company makes money.”

“We have discussed the new-car purchase in its various forms for the last several pages. No, you can’t afford a new car unless you are a millionaire and can, therefore, afford to lose thousands of dollars, all in the name of the neat new-car smell. A good used car that is less than three years old is as reliable or more reliable than a new car. A new $28,000 car will lose about $17,000 of value in the first four years you own it. That is almost $100 per week in lost value. To understand what I’m talking about, open your window on your way to work once a week and throw out a $100 bill.”

“Debt is not a tool; it is a method to make banks wealthy, not you. The borrower truly is slave to the lender.”

Money Myths: The (Non)Secrets of the Rich


  • Debt Myths:
  • Debt is a necessary evil.
  • Credit cards help you build credit.
  • Debt allows you to live beyond your means.
  • You can't get out of debt without borrowing more.
  • Declaring bankruptcy is the best solution for overwhelming debt.


  • Debt is a financial burden that enslaves you and keeps you from being financially free.
  • Credit cards make it easy to buy things you can't afford, leading to unnecessary debt.
  • Living beyond your means leads to financial instability and debt.
  • Creating a budget and sticking to it is the best solution for managing debt.
  • Bankruptcy ruins your credit and leaves a lasting financial impact.
  • Money Myths:
  • You need to earn a high income to get out of debt.
  • Living below your means is synonymous with living in poverty.
  • Investing in the stock market is risky and only for the wealthy.
  • Credit cards are necessary for building credit.
  • It's okay to borrow money from retirement accounts to pay off debt.


  • Creating a budget and sticking to it allows you to get out of debt regardless of your income level.
  • Living below your means is the key to financial freedom.
  • Investing in index funds is a low-risk way to build wealth.
  • Building credit with a secured credit card or through other means is possible without relying on credit cards.
  • Borrowing from retirement accounts to pay off debt is a short-term solution with long-term consequences.


“The lottery is a tax on poor people and on people who can’t do math. Rich people and smart people would be in the line if the lottery were a real wealth-building tool, but the truth is that the lottery is a rip-off instituted by our government. This is not a moral position; it is a mathematical, statistical fact. Studies show that the zip codes that spend four times what anyone else does on lottery tickets are those in lower-income parts of town. The lottery, or gambling of any kind, offers false hope, not a ticket out.”

“A budget is people telling their money where to go instead of wondering where it went.”

“A good man leaves an inheritance to his children’s children” (Prov. 13:22 NKJV). I”

“You must walk to the beat of a different drummer. The same beat that the wealthy hear. If the beat sounds normal, evacuate the dance floor immediately! The goal is to not be normal, because as my radio listeners know, normal is broke.”

Two More Hurdles: Ignorance and Keeping Up with the Joneses


  • The Total Money Makeover is a process that requires effort and commitment.
  • Denial, Myths, Ignorance, and Approval are common obstacles on the path to financial freedom.
  • Overcoming denial involves acknowledging the reality of your financial situation.
  • Debt myths can be harmful and prevent individuals from taking control of their finances.
  • Ignorance about personal finance can lead to poor financial decisions.
  • Approval from others can influence spending habits and lead to financial instability.
  • The Total Money Makeover involves following a specific plan, including creating a budget, eliminating debt, and saving for emergencies and retirement.
  • It is important to stay committed to the process and avoid falling back into old habits.
  • Climbing the mountain of financial freedom will be challenging, but the rewards are worth it.
  • Seek guidance from trusted resources and experts if needed.


“Here’s the deal. When you get married, you become a team. The pastor at your wedding wasn’t joking when he said, “And now you are one.” It’s called unity. The old marriage vows say, “Unto thee I pledge all my worldly goods.” In other words, “I’m all in,” so combine the checking accounts. It’s hard to have unity when you separate your bank accounts. When his money is over here, and her money is over there, it’s easy to live in your own little financial world instead of working as a team. When you do your spending together, it’s about “our” money. We have an income and we have expenses and we have goals. So when you’re both in agreement on where the money is going, then you’ve taken a major step to being on the same page in your marriage, and you will create awesome levels of communication. This all boils down to trust. Do you trust your spouse or not? I’ve heard from people who keep separate bank accounts just in case their spouse leaves them. Well, why on earth would you marry someone you can’t trust? And if that’s really the case, then you need marriage counseling, not separate bank accounts! Your spouse isn’t your roommate, and this isn’t a joint business venture. It’s a marriage! You don’t run your household and your life separately. Your job is to love each other well, and that includes having shared financial goals—which is hard to do when you have separate accounts.”

“typical millionaire lives in a middle-class home, drives a two-year-old or older paid-for car, and buys blue jeans at Wal-Mart.”

“We are scaling down” is a painful statement to make to friends or family.”

Save $1,000 Fast: Walk Before You Run


  • The first step in the Total Money Makeover is building an emergency fund of $1,000 or more.
  • Having an emergency fund can help prevent reliance on credit cards for unexpected expenses.
  • Building an emergency fund requires sacrifices and budgeting, but it is worth it for financial peace.
  • The emergency fund should be kept in a liquid form, easily accessible in case of true emergencies.
  • Delayed gratification and trust in God's provision are essential parts of building an emergency fund.


“If you’re married, agree on the budget with your spouse. This one sentence requires a stand-alone book to describe how, but the bottom line is this: if you aren’t working together, it is almost impossible to win. Once the budget is agreed on and is in writing, pinky-swear and spit-shake that you will never do anything with money that is not on that paper. The paper is the boss of the money, and you are the boss of what goes on the paper, but you have to stick to the budget, or it’s just an elaborate theory.”

The Debt Snowball: Winning the Battle Against Payments


  • Eliminating debt is crucial for building wealth and securing financial freedom.
  • Create a budget and stick to it, focusing on essential expenses only.
  • Use the Debt Snowball method to pay off debts from smallest to largest, regardless of interest rates.
  • Increase income through side jobs or selling items to accelerate debt repayment.
  • Temporarily halting retirement contributions can help speed up debt repayment but should be reinstated once debt is eliminated.
  • Avoid dipping into the emergency fund for non-emergencies and replenish it as soon as possible.
  • Large debts, such as second mortgages, business loans, and rental property mortgages, are paid off in later steps.
  • With intense focus, sacrifice, and extra effort, most debt can be eliminated within 18-24 months.


“Many of you reading this are convinced that you could become wealthy if you could get out of debt. The problem now is that you are feeling more and more trapped by the debt. I have great news! I have a foolproof, but very difficult, method for getting out of debt. Most people won’t do it because they are average, but not you. You have already figured out that if you will live like no one else, later you can live like no one else. You are sick and tired of being sick and tired, so you are willing to pay the price for greatness. This is the toughest of all the Baby Steps to your Total Money Makeover. It is so hard, but it is so worth it. This step requires the most effort, the most sacrifice, and is where all your broke friends and relatives will make fun of you (or join you).”

“After you list the debts smallest to largest, pay the minimum payment to stay current on all the debts except the smallest. Every dollar you can find from anywhere in your budget goes toward the smallest debt until it is paid. Once the smallest is paid, the payment from that debt, plus any extra “found” money, is added to the next smallest debt. (Trust me, once you get going, you will find money.) Then, when debt number two is paid off, you take the money that you used to pay on number one and number two and you pay it, plus any found money, on number three. When three is paid, you attack four, and so on. Keep paying minimums on all the debts except the smallest until it is paid. Every time you pay one off, the amount you pay on the next one down increases. All the money from old debts and all the money you can find anywhere goes on the smallest until it is gone. Attack! Every time the Snowball rolls over, it picks up more snow and gets larger, and by the time you get to the bottom, you have an avalanche.”

Finish the Emergency Fund: Kick Murphy Out


  • The emergency fund is a critical component of financial security.
  • Aim to save three to six months' worth of expenses in an easily accessible account.
  • Use windfalls and bonuses to build up the emergency fund quickly.
  • Do not use the emergency fund for non-emergencies or debts.
  • Once the emergency fund is established, focus on eliminating debt, starting with high-interest debts.
  • The emergency fund provides peace of mind and protects against unexpected expenses.
  • Men and women may have different perspectives on the importance and use of the emergency fund.


“Being the highly trained investment mogul that I am, I could certainly find places to put that money where it would earn more. Or would it? Remember, personal finance is personal. I have come to realize that Sharon’s peace of mind bought with the oversized emergency fund is a great return on investment. Guys, this can be a wonderful gift to your wife. An Emergency Fund Can”

“The reality is that Murphy doesn’t visit as much, but when he does, we hardly notice his presence. When Sharon and I were broke, our heating-and-air system quit, and the repair cost $580. It was a huge, hairy deal. Recently I had a new $570 water heater installed because the old one started leaking, and I hardly noticed. I wonder if the stress relief that your Total Money Makeover provides will allow you to live longer?”

“There are some Baby Step Three clarifications. Joe asked recently if he should stop his Snowball—Step Two—to get his emergency fund finished. Joe and his wife have twins due in six months. Brad’s plant is closing in four months, and he will lose his job. Mike got a huge severance check of $25,000 last week when his company downsized him. Should these people work on debt or finish the emergency fund? All three should temporarily stop Snowballing and concentrate on the emergency fund because we can see distant storm clouds that are real. Once the storm passes, they can resume the plan as before. Resuming the plan for Joe means that once the babies are born healthy, are home, and everyone is fine, Joe will take the emergency fund back down to $1,000 by using the rest of the savings to pay the Debt Snowball. Resuming for Brad would mean that once he finds his new job, he’ll do the same. Mike should hold his instant emergency fund of $25,000 until he is reemployed. The sooner he can get a job, the more that severance is going to look like a bonus and have a huge impact on the Debt Snowball.”

“Saving for a down payment or cash purchase of a home should occur after becoming debt-free in Step Two and after finishing the emergency fund in Step Three. That makes saving for a down payment Baby Step Three (b). You should save for the home if you have the itch before moving on to the next step. Many people are worried about getting a home, but please let it be a blessing rather than a curse. It will be a curse if you buy something while you are still broke. There are all sorts of folks who are eager to “work with you” so you can make it happen sooner, but the definition of “Creative Financing” is “Too Broke to Buy a House.”

Maximize Retirement Investing: Be Financially Healthy for Life (Maintaining Your Money Muscles)


  • Investing in retirement is an important part of securing your financial future.
  • Start by maximizing your employer's 401k contributions, then invest in low-cost index funds like VTI, VXW, and VTSA.
  • Use tools like Personal Finance Software (PFS) to monitor your progress.
  • Stay disciplined by following The Total Money Makeover steps.
  • Retiring with dignity is achievable at any age.


“Here’s a Reader’s Digest version of my approach. I select mutual funds that have had a good track record of winning for more than five years, preferably for more than ten years. I don’t look at their one-year or three-year track records because I think long term. I spread my retirement, investing evenly across four types of funds. Growth and Income funds get 25 percent of my investment. (They are sometimes called Large Cap or Blue Chip funds.) Growth funds get 25 percent of my investment. (They are sometimes called Mid Cap or Equity funds; an S&P Index fund would also qualify.) International funds get 25 percent of my investment. (They are sometimes called Foreign or Overseas funds.) Aggressive Growth funds get the last 25 percent of my investment. (They are sometimes called Small Cap or Emerging Market funds.) For a full discussion of what mutual funds are and why I use this mix, go to and visit The invested 15 percent of your income should take advantage of all the matching and tax advantages available to you. Again, our purpose here is not to teach the detailed differences in every retirement plan out there (see my other materials for that), but let me give you some guidelines on where to invest first. Always start where you have a match. When your company will give you free money, take it. If your 401(k) matches the first 3 percent, the 3 percent you put in will be the first 3 percent of your 15 percent invested. If you don’t have a match, or after you have invested through the match, you should next fund Roth IRAs. The Roth IRA will allow you to invest up to $5,000 per year, per person. There are some limitations as to income and situation, but most people can invest in a Roth IRA. The Roth grows tax-FREE. If you invest $3,000 per year from age thirty-five to age sixty-five, and your mutual funds average 12 percent, you will have $873,000 tax-FREE at age sixty-five. You have invested only $90,000 (30 years x 3,000); the rest is growth, and you pay no taxes. The Roth IRA is a very important tool in virtually anyone’s Total Money Makeover. Start with any match you can get, and then fully fund Roth IRAs. Be sure the total you are putting in is 15 percent of your total household gross income. If not, go back to 401(k)s, 403(b)s, 457s, or SEPPs (for the self-employed), and invest enough so that the total invested is 15 percent of your gross annual pay. Example: Household Income $81,000 Husband $45,000 Wife $36,000 Husband’s 401(k) matches first 3%. 3% of 45,000 ($1,350) goes into the 401(k). Two Roth IRAs are next, totaling $10,000. The goal is 15% of 81,000, which is $12,150. You have $11,350 going in. So you bump the husband’s 401(k) to 5%, making the total invested $12,250.”

“The average household income in America is right around $50,000 per year, according to the Census Bureau. Joe and Suzy Average would invest $7,500 (15 percent) per year or $625 per month. If you make $50,000 per year and have no payments except the house mortgage and live on a budget, can you invest $625 per month? Follow me here. If Joe and Suzy invest $625 per month with no match into Roth IRAs from age thirty to age seventy, they will have $7,588,545 tax-FREE! That is almost $8 million. What if I’m half-wrong? What if you end up with only $4 million? What if I’m six times wrong? Sure beats the 97 out of 100 sixty-five-year-olds who can’t write a check for $600! I would submit to you that Joe and Suzy are well below average. Why? In our example they started at the average household income in America, and in forty years of work never got a raise. They saved 15 percent of income and never increased it by one dollar. There is no excuse to retire without financial dignity in the United States today. Most of you will have well over $2 million pass through your hands in your working lifetime, so do something about catching some of that money. Gayle asked me one day if it was too late for her to start saving. Gayle wasn’t twenty-seven like Joe and Suzy. She was fifty-seven years old, but with her attitude you would have thought this lady was 107. Harold Fisher had a much better outlook at age one hundred than Gayle did at age fifty-seven. Life had dealt her some blows and had knocked most of the hope out of her. A Total Money Makeover is not a magic show. You start where you are, and you do the steps. These steps work if you are twenty-seven or fifty-seven, and they don’t change. Gayle might be starting the retirement investing step at sixty that Joe and Suzy start at thirty years old. Gayle was unwise to enter her sixties without an emergency fund and with credit-card debt and a car payment. She, like all of us, couldn’t save when she has debt and no umbrella for when it rains. Would it have been better for Gayle to start when she was twenty-seven or even forty-seven? Obviously. But once she was done with the pity party, she still needed to start with Baby Step One and follow The Total Money Makeover step-by-step to put herself in the best position possible.”

College Funding: Make Sure the Kids Are Fit Too


  • Prioritize saving for college over other debt payments if possible.
  • Consider options such as military service, work-study programs, and high-earning summer jobs to pay for education.
  • Utilize scholarships, grants, and financial aid to reduce or eliminate the need for student loans.
  • Encourage your child to attend an affordable school and live on campus to save money.
  • Save and invest early and consistently to build up funds for college expenses.
  • Avoid taking on unnecessary debt during college years.
  • Be resourceful and creative in finding ways to pay for education without relying on student loans.


“Only if you mix knowledge with attitude, character, perseverance, vision, diligence, and extreme levels of work will your college degree produce for you.”

“15 percent of success could be attributed to training and education, while 85 percent was attributed to attitude, perseverance, diligence, and vision.”

Pay Off the Home Mortgage: Be Ultrafit


  • Mortgages can be a useful tool for home ownership, but they should be used wisely and with caution.
  • Adjustable rate mortgages (ARMs) and balloon mortgages have hidden risks that can lead to financial disaster.
  • Home equity loans (HELs) are often marketed as a solution for emergencies, but they actually create more risk and can lead to foreclosure.
  • Paying cash for a home is possible, even if it requires sacrifices in lifestyle.
  • It takes an average of seven years to pay off a mortgage and reach financial peace, but the rewards are worth it.


“One thing I am sure of in my Total Money Makeover: I had to quit telling myself that I had innate discipline and fabulous natural self-control. That is a lie. I have to put systems and programs in place that make me do smart things. Saying, “Cross my fingers and hope to die, I promise, promise, promise I will pay extra on my mortgage because I am the one human on the planet who has that kind of discipline,” is kidding yourself. A big part of being strong financially is that you know where you are weak and take action to make sure you don’t fall prey to the weakness. And we ALL are weak. Sick”

“The ARM, Adjustable Rate Mortgage, was invented in the early 1980s. Prior to that, those of us in the real estate business sold fixed-rate 7 or 8 percent mortgages. What happened? I was there in the middle of that disaster of an economy when fixed-rate mortgages went as high as 17 percent and the real estate world froze. Lenders paid out 12 percent on CDs but had money loaned out at 7 percent on hundreds of millions of dollars in mortgages. They were losing money, and lenders don’t like to lose money. So the Adjustable Rate Mortgage was born, in which your interest rate goes up when the prevailing market interest rates go up. The ARM was born to transfer the risk of higher interest rates to you, the consumer. In the last several years, home mortgage rates have been at a thirty-year low. It is not wise to get something that adjusts when you are at the bottom of rates! The mythsayers always seem to want to add risk to your home, the one place you should want to make sure has stability. Balloon mortgages are even worse. Balloons pop, and it is always strange to me that the popping sound is so startling. Why don’t we expect it? It is in the very nature of balloons to pop. Wise financial people always move away from risk, and the balloon mortgage creates risk nightmares.”

“A man with an experience is not at the mercy of a man with an opinion.”

“I tell everyone never to take more than a fifteen-year fixed-rate loan, and never have a payment of over 25 percent of your take-home pay. That is the most you should ever borrow.”

Build Wealth: Arnold Schwarzedollar, Mr. Universe of Money (Baby Step Seven)


  • The Total Money Makeover has three uses for money: FUN, INVESTING, and GIVING.
  • Fun should begin from Baby Step One, but it has to be inexpensive fun in the beginning.
  • Investing begins at Baby Step Four (Invest 15 Percent of Your Income in Retirement).
  • Giving something, even if it is just giving your time by serving soup to the homeless, should start from Baby Step One.
  • Do not neglect any of the three uses of money; doing so will result in missed opportunities and potential regrets.
  • The most mature part of who you are will meet the kid inside as you learn to involve yourself in the last use of money, which is to GIVE it away.
  • Wealthy people are those who have reached the Pinnacle Point, where their money makes more than they do and can comfortably live on their investment income.
  • Giving is the biggest reward of the entire workout and should be a priority for those who have achieved financial security.
  • Giving does not necessarily mean giving large sums of money; it can also mean giving your time, resources, or talents to help others.
  • The most effective givers are those who give freely and without expectation of anything in return.
  • Secret Santa is a great example of the joy and fulfillment that comes from giving generously and anonymously.
  • Doing all three uses of money - FUN, INVESTING, and GIVING - is essential for achieving Total Money Makeover status.


“At this stage in The Total Money Makeover, you are the Mr. Universe of Money, with serious abs, pecs, and quads. You have all this financial muscle, so now you should do something intentional with it. It is not just to look at. We built this financial superbody for a reason. To have FUN, INVEST, and GIVE.”

“one reason to have a Total Money Makeover is to build wealth that allows you to have fun. So have some fun! Taking your family, even the extended ones, on a seven-day cruise, buying large diamonds, or even buying a new car are things you can afford to do when you have millions of dollars. You can afford to do these things because when you do them, your money position is hardly even affected. If you like travel, travel. If you like clothes, buy some. I am releasing you to have some fun with your money, because money is to be enjoyed. That guilt-free enjoyment is one of the three reasons to have a Total Money Makeover.”

“Someone who never has fun with money misses the point. Someone who never invests money will never have any. Someone who never gives is a monkey with his hand in a bottle.”

Live Like No One Else: False Cents of Security


  • Wealth can become a destructive obsession if not handled properly.
  • Material possessions do not bring true happiness or fulfillment.
  • Being tough on children regarding money management to prevent them from being ruined by inherited wealth.
  • Wealth amplifies one's character – be generous, kind, or responsible with it.
  • Possessing riches gives the power to decide how they are used.
  • It is a spiritual duty for good people to possess wealth and use it for good purposes.
  • The Total Money Makeover goes beyond just money issues and requires a complete life makeover.
  • Hope: become debt-free, retire with dignity, leave an inheritance, give generously.


“My kids, you, and I can have good things happen as a result of our Total Money Makeover only if we have the spiritual character to recognize that wealth is not the answer to life’s questions. We further must recognize that while wealth is very fun, it comes with great responsibility. Another paradox is that wealth will make you more of what you are. Let that one soak in for a minute. If you are a jerk and you become wealthy, you will be king of the jerks. If you are generous and you become wealthy, you will be most generous. If you are kind, wealth will allow you to show kindness in immeasurable ways. If you feel guilty, wealth will ensure that you feel guilty for the rest of your life.”


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