We Have Only 7 Days Until Dave Ramsey’s Baby Step 7

paid off house christmas lights

Hi! Thank you for visiting. This is the first in a series of articles that will be shared on various sites while my wife and I count the days left until we pay off our house! Come back every day for a new post and link to where it can be found.

In 7 days we PAY OFF THE HOUSE!!!

My wife and I will arrive at Baby Step 7 on Monday, December 14th.

This is the final stage in Dave Ramsey's process for building wealth and achieving financial peace.

The light is getting brighter at the end of the tunnel AND I AM SO EXCITED!

8 years in the making

My wife and I didn’t start paying attention to our money until a few years after we married.

We joined together in 1999 and bought a house for $149,000.

We also came into the marriage with a car loan and some revolving credit card debt, but nothing as debilitating as the stories that come from my coaching clients.

We were doing okay, but we weren’t thriving.

We were average Americans who could pay our bills and put a couple hundred dollars into a retirement account. #Meh

We were never intentional with our financial goals – that is until I learned about Dave Ramsey’s Baby Steps.

Lost in a sea of fragmented advice

I accidentally stumbled across Dave Ramsey’s radio show in 2003(ish).

I challenged all his crazy antics.

He told people to cut up their credit cards, to stop saving for retirement while paying off student loans, and that we shouldn't worry about keeping a home mortgage for the interest deduction.

Until this point I had been taking bits and pieces of financial advice from all over the place:

  • Jean Chatzky would talk about saving for retirement on the TODAY show
  • Suze Orman would talk about using credit cards to build credit
  • CNBC squawked about the hottest stock I should buy RIGHT NOW

This is the same advice being shared today.

I also heard you should use OPM (Other People's Money) to buy real estate.

We followed all the financial tidbits from various financial gurus

…and it brought us a negative net worth of $70,000.

Debt is a tool, right?

I dug deeper into what Dave Ramsey was saying and found the truth:

Finally – a financial plan I could understand!

Dave Ramsey's Baby Steps:

1) Save $1,000 in cash for emergencies
2) Pay off all consumer debt as fast as you can
3) Build up an emergency fund large enough to cover 3-6 months of household expenses
4) Save 15% of income towards retirement
5) Invest and save for kid’s college
6) Pay off the house early
7) Build wealth and give

We have 7 days left until we reach Dave Ramsey's Baby Step 7.

O. M. Gosh!

TIP: Don't skip a baby step!

In 2005 we started the Baby Steps.

We already had a couple thousand in a savings account, we were putting money towards our daughter’s future, and we were saving for retirement.

Oops, we skipped a Baby Step or two!

In 2006, my wife “needed” a new car. We financed $12,000 for a $21,000 SUV.

Why? Because we weren’t intentional enough to save up enough cash to pay for it.

I was mad.

I thought we were doing better than that.

I thought we were on a plan.

Nope. We were not following the steps!

We did have the first $1,000 in an account to satisfy Baby Step 1, so we moved on to Baby Step 2: Pay off all consumer debt.

I vowed to take all the money made from a side hustle and pay it towards the debt. In 13 months we paid off about $15,000 worth of debt – including her SUV. #FREEDOM!

Baby Step 3, a fully-funded emergency fund, was finished about a year later. #Whew

Then we started saving for retirement and put money into investments for our daughter’s college (Baby Steps 4 and 5).

We could have paid off our house sooner, but that was never my wife’s priority.

Note: Come back to SteveStewart.me/paidoffhouse on December 14th, 2015 to find out what her priority was.

7 days to a paid off house


You Could Be Debt Free Without Even Trying

What is funny about the Baby Steps is you will become debt free someday.

It is guaranteed.

It is inevitable.

Every loan offer you take, every credit swipe you make, every auto loan mistake has a built-in debt-free date.

  • A 5-year car loan is paid off in 5 years
  • A $10,000 credit card debt is paid off in an average of 17 years
  • Even a 30 year mortgage is paid off in 30 years

The key is to stop borrowing money and always make your payments on time.

Even if you just make the minimum payments you will pay off the debt some day.

It's simpler than it looks

You can expedite your debt free date, as we have, by paying extra on your debts and never borrowing money again.

We sent the bank a little extra to pay down the mortgage, but not as much as I wanted.

However, we avoided new debt by saving up to pay cash for big purchases and never fell back in the Baby Steps.

We stayed the course and never stopped looking ahead to the day when our house would be paid off.

We did it, so can you!

In 7 days we will stop buying our house and we will own it free and clear!

You can do this too!

You already have a debt free date!

It’s up to you to move the date forward on your calendar.

What could you do this week to accelerate your race to Baby Step 7?

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