What system do you use to get ahead?

[Joel]

For us, we use a combination of a couple of systems.

1. The Automatic Millionaire (David Bach). We've made it so that saving money is automatic. We've also paid off HUGE amounts of our debt already and plan on paying more off.

2. Rich Dad, Poor Dad (Robert Kiyosaki). We're renting out our old house and working on building businesses. Our hope is to create not only active income but passive income as well.

[minnie1928]

We are currently using a modified Dave Ramsey approach. We're down to two debts, Disney vacation club (to be paid off this year) and our house.

The interest rate on the house is low, so at that point I may start doing a little Automatic Millionaire to boost our investment portfolio.

[neatdesign]

We started using You Need a Budget (YNAB) just a couple of weeks ago, and already I can see a major improvement in how we control our finances and spending.

~ Jenney

[Daniel_Shop]

I am doing Kiyosaki way. Keep debts to nothing, increase net worth and try to build a business.

Trying to risk the least possible.

Business is the playground were we can hit homeruns. I had failed but I need only one hit. booom

[cptacek]

I would say Dave Ramsey, modified. As in, if cash flow is a problem, pay off smallest debt to largest debt. Once cash flow is not a problem anymore, pay off highest interest rate to lowest interest rate, and if the interest rate is less than what you can make in a high interest savings account, don't pay anything on that debt except the minimum...as long as you are saving in the savings account.

I also like to do Automatic Millionaire, modified, as in rent, 401(k), student loan payment, gym membership, 0% interest credit card (with the same payment every month) coming out automatically, but variable bills I pay, so I can see why they are varying.

[debtfreecb]

I use David Ramsey's snowball approach.

[Ima saver]

I use the pay my self first method. That is the first money I take out of each paycheck. I have used the envelope method for 42 years. Put the cash in the envelopes weekly; take it out twice a month to pay the bills.

[lgslgs]

The book "Ordinary People, Extraordinary Wealth" ( Amazon.com: Ordinary People, Extraordinary Wealth: The 8 Secrets of How 5,000 Ordinary Americans Became Successful Investors--and How You Can Too: Books: Ric Edelman ) was the most influential for me - especially the part where the only regrets any of the folks had was staying too conservative, too long with their investments. That got me a lot more risk tolerance and built our nest egg.

The "not racing to pay off a low interest mortgage" part was important as well.

Lynda

[Marcymox]

I do a modified Dave Ramsey and add in some other "rules" that I have made up. One of the things I do is NEVER go out any buy anything but groceries and bills on payday. We used to have this problem of going shopping for everything we "Needed" that first weekend after payday- buying things we thought we needed, wanted, ect, and then scrambling for 2 weeks until the next payday with no milk, running out of things, or having unexpected expenses.

so one of the things I did after getting out of debt, was on payday, get online, and pay ALL the bills due that cycle first. Before ever leaving the house to shop for anything. at least I knew, no matter what happened, the lights would be on, the water would still run. After that, I'd buy 2 weeks worth of groceries. That's it. I wouldn't do anymore shopping for ANYTHING for a full week- until the next friday. By then, all the bills had cleared, and I was able to evaluate more fully the amount of available money I really had to buy shoes, or re-decorate or some other frivolus activity.

[BabyBear]

I know this is an older topic, but I just registered tonight and thought I'd make this my first post. Hope no one minds!!

I guess I've always been a little bit of an oddball. I've always been a saver--with no credit cards.

So, by the time I purchased my home last year I had money in savings and no debt. Truck was already paid for and student loan was paid off.

I have really been impressed with Dave Ramsey, but most of what he suggests doesn't really pertain to me.....I already have 3 months living expenses saved, I have no debt (other than my mortgage) to snowball, I save in my 401(k) and contribut to a 529 account, even though I don't even have kids yet.

But, I still wanted some kind of a plan to keep me on the right track. I felt I was wasting money and wanted to keep from tightening the belt too much.

So, I put most of my bills on budget billing so I know how much they will be each month. My water/sewer bill was the only thing I couldn't do this for, but it's about the same every month. So, I figured up the cost of all of my utilities and mortgage each month. At the time I worked at a job that only paid me twice a month. So, I totaled those bills for the month and divided by 2.

I opened a checking account just for paying bills, and deposited that amount each pay.

I have a new job now where I get paid every week (LOVE this!!) So I took my total needed and divided by 4 and now deposit that amount each week. Money (cash) that is left over gets split 3 ways and gets put into envelopes: Gas, Groceries, Other

The first two are obvious. My "other" is for personal items, eating out, clothes, etc. If I need something more expensive, I can take it out of savings, but I have not needed to do that yet. I save up for something if I want it bad enough or I just don't get it if I can't pull it from an envelope. Now that I get paid every week it seems that things aren't nearly as tight. I have money left in my envelopes when I get paid again. So far, I've only been at my new job about a month. When I have money left over, I just add it to the new amount I'm adding to the envelope that week. I think I will figure up a dollar amount and if any envelope gets over that amount, I'll put it into savings.

This plan has really worked well for me. I've been using it for quite awhile now but it's working so much better with a weekly paycheck. All of my figures are take-home (401(k), 529, savings, insurances are all taken out before I figure anything else up)

Hope this makes sense. And I hope it may be helpful to others!!

By the way, I am 31, too. Don't know if that makes a difference, but thought I'd throw it out there!

[JanH]

Wow, Babybear. That's great. Wish I'd had that much sense at that age.

[Koppur]

I'm doing a mix of Dave Ramsey Snowball and Suze Ormans Young Fabulous and Broke and David bachs Automatic Millionaire.

huh, maybe that's why things aren't working out for us. I should probably stick to one programs...

[DebbieL]

I've never read any of the books or used anyone else's methods. I just use my own good old common sense (which doesn't seem too common anymore). Live beneath my means, budget, and save for a rainy day.