Dave Ramsey: My Spouse is Terrible with Money

Kaitlyn from Minnesota calls in, she has been married for over 4 years, and their finances are run by the roommate method. Basically, they each pay half of the mortgage and other bills to one person, who then makes the payment. Kaitlyn says they want to start the baby steps for financial success. However, her husband wants to take care of his debt, and she takes care of hers. She knows if they could work together, things would work out better for them. However, her husband has not given any reason why he would want to do this.

Dave and George Kamel are very blunt, and they believe she married someone with the mentality of a child. George states that when they said “I Do,” it was no longer Me but we. This means no separate accounts or separate debts; this is one team, one fight. Dave tells Kaitlyn she needs to get to the bottom of his objections; there should be no reason to be separated like they are. Dave suggests she work together with her husband and create a budget that works together as a team. She may need to have a hard conversation, but marriage isn’t supposed to be easy; it requires work.

Dave Ramsey’s 7 Babysteps For Success

• Baby Step #1 Save 1000

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  In this first step, your goal is to save $1,000 as fast as you can. Your emergency fund will cover those unexpected life events you can't plan for. And there are plenty of them. You don’t want to dig a deeper hole while you’re trying to work your way out of debt!

• Baby Step #2 Pay Off All Debt (Except the House) Using the Debt Snowball

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  Next, it’s time to pay off the cars, the credit cards and the student loans. Start by listing all of your debts except for your mortgage. Put them in order by balance from smallest to largest—regardless of interest rate. Pay minimum payments on everything but the little one. Attack that one with a vengeance. Once it's gone, take that payment and put it toward the second-smallest debt, making minimum payments on the rest. That's what's called the debt snowball method, and you’ll use it to knock out your debts one by one.

• Baby Step #3 Save 3–6 Months of Expenses in a Fully Funded Emergency Fund

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  You’ve paid off your debt! Don’t slow down now. Take that money you were throwing at your debt and build a fully funded emergency fund that covers 3–6 months of your expenses. This will protect you against life’s bigger surprises, like the loss of a job or your car breaking down, without slipping back into debt.
• Baby Step #4 Invest

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  It's time to get serious about retirement—no matter your age. Take 15% of your gross household income and start investing it into your retirement. Start with your company’s 401(k) plan and invest up to the full employer match. Then invest the rest into Roth IRAs—one for you and one for your spouse (if you’re married).

• Teach Your Kids Financial Responsibility

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• Baby Step #6 Pay Off Your Home

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  Now, bring it all home. Baby Step 6 is the big dog! Your mortgage is the only thing between you and complete freedom from debt. Can you imagine your life with no house payment? Any extra money you can put toward your mortgage could save you tens (or even hundreds) of thousands of dollars in interest.
• Baby Step #7 Build Wealth and Give

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  You know what people with no debt can do? Anything they want! The last step is the most fun. You can live and give like no one else. Keep building wealth and become outrageously generous, all while leaving an inheritance for your kids and their kids. Now that's what we call leaving a legacy!