The Total Money Makeover Summary

The Total Money Makeover Summary
Reading Time: 15 minutes


In today’s fast-paced and consumer-driven world, mastering the art of personal finance is more critical than ever. As countless individuals find themselves trapped in the vicious cycle of debt and financial uncertainty, there’s a pressing need to explore practical strategies for achieving financial wellness. Welcome to our latest blog post, where we dive into an incisive analysis of one of the most influential personal finance books of our time: “The Total Money Makeover” by Dave Ramsey. This bestseller has been the cornerstone for many in their journey towards financial independence. With its no-nonsense approach and actionable steps, Dave Ramsey’s book promises a path out of debt and into a world where you are in control of your finances. In this post, we will dissect the key principles of “The Total Money Makeover,” evaluate its 7 Baby Steps, and explore real-life applications. Additionally, we will critically assess the pros and cons of Ramsey’s philosophy. Whether you’re a personal finance aficionado or someone looking to turn a new leaf financially, this analysis will offer valuable insights and empower you with the tools needed for a financial transformation. So tighten your seat belts as we embark on a journey to dissect and analyze the essence of “The Total Money Makeover” and its potential impact on your financial destiny. Let’s get started!

Quick Summary: The Total Money Makeover – A Path to Financial Fitness

In a world where financial uncertainties abound, Dave Ramsey’s “The Total Money Makeover” serves as a beacon, guiding individuals through the murky waters of personal finance. In this quick summary, we’ll take a brief tour of Ramsey’s financial wisdom and the steps he advocates for financial freedom.

First things first, Dave Ramsey shoots straight and debunks common financial myths. From the idea that debt is a necessary evil, to the allure of get-rich-quick schemes, Ramsey demystifies the foggy financial landscape and replaces it with clear, tried-and-true principles.

At the heart of “The Total Money Makeover” lies Ramsey’s 7 Baby Steps. Here’s a quick rundown:

  1. Save $1,000 for a Starter Emergency Fund: Before anything else, build a small safety net to avoid new debts for unexpected expenses.
  2. Pay Off All Debt (except the house) Using the Debt Snowball: List debts, smallest to largest, and pay them off in that order to build momentum.
  3. Save 3-6 Months of Expenses for a Full Emergency Fund: With debt out of the way, fortify your finances by saving a bigger emergency fund.
  4. Invest 15% of Household Income Into Retirement: Secure your golden years by consistently investing in retirement accounts.
  5. Save for Your Children’s College Education: Use tax-advantaged savings plans to ensure your children can get an education without loans.
  6. Pay Off Your Home Early: Pour extra money into your mortgage, and liberate yourself from the chains of debt.
  7. Build Wealth and Give Generously: With financial security, focus on building wealth and giving back.

Aside from the Baby Steps, Ramsey emphasizes the importance of budgeting. He believes that creating and sticking to a budget is crucial in telling your money where to go instead of wondering where it went. Furthermore, he stresses the importance of personal behavior over mathematics. To be financially fit, one must make sound financial decisions consistently.

Lastly, the book doesn’t just preach; it inspires with numerous real-life success stories. These accounts of individuals and families who turned their financial lives around serve as potent motivators.

In a nutshell, “The Total Money Makeover” is not about financial tricks or secrets; it’s about proven, common-sense steps to systematically tackle debt, save money, and build wealth. Whether you’re drowning in debt or looking to refine your financial strategies, Dave Ramsey’s roadmap is an invaluable resource on the journey to financial fitness.

Who is The Total Money Makeover For?

“The Total Money Makeover” by Dave Ramsey is a treasure trove for individuals grappling with debt, families yearning for financial stability, and young adults embarking on their financial journey. The book’s structured approach to eliminating debt, coupled with guidance on saving and budgeting, is particularly valuable. Additionally, those approaching retirement can glean insights on prudent saving and investment strategies to ensure a comfortable post-work life.

For wealth builders, the book lays the foundation for amassing wealth responsibly and generously. It also appeals to skeptics of mainstream financial advice, especially those who prefer to steer clear of debt. The compilation of motivational success stories woven throughout the book serves as a catalyst for change, inspiring readers to take decisive steps toward financial freedom and security.

The Total Money Makeover in Three Sentences

  • “The Total Money Makeover” by Dave Ramsey is a personal finance book that advocates for a disciplined and structured approach to managing money, with the aim of achieving financial independence.
  • It promotes the ‘7 Baby Steps’, which is a series of progressive financial goals including saving an emergency fund, paying off debt using the ‘debt snowball’ method, and investing for retirement and college savings.
  • The book emphasizes the importance of living within your means, avoiding debt, and being intentional with spending by using a budget.
  • Through real-life success stories, Ramsey demonstrates how individuals, regardless of income levels, can transform their financial situation by following the principles and steps outlined in the book.
  • Additionally, the book stresses the significance of personal responsibility, behavioral change, and a long-term view in achieving financial success and creating a legacy for future generations.

5 Key Takeaways From The Total Money Makeover

  • Embrace the 7 Baby Steps: The book presents a sequential approach called the 7 Baby Steps, which are designed to help individuals build a strong financial foundation. These steps include saving for an emergency fund, paying off debts, saving for retirement, and more. Following this structured approach can help individuals progressively improve their financial health.
  • Avoid Debt at All Costs: Dave Ramsey is a strong proponent of living a debt-free life. The book emphasizes that debt is a hindrance to financial freedom and encourages readers to avoid taking on new debt, and to aggressively pay off existing debts using the ‘debt snowball’ method.
  • Budgeting is Essential: One of the central themes in “The Total Money Makeover” is the importance of creating and sticking to a budget. A budget is portrayed as a tool that gives you control over your finances by ensuring that every dollar has a purpose.
  • Change Your Money Behavior: The book emphasizes that financial success is not just about knowledge, but also about behavior. Changing your attitude towards money, making sacrifices, and avoiding consumerism are necessary for achieving financial independence.
  • Think Long Term and Build Wealth Slowly: The Total Money Makeover discourages get-rich-quick schemes and instead promotes a steady, long-term approach to building wealth. It stresses the importance of saving and investing consistently over time as a means to create a stable financial future and a legacy for your family.

The Total Money Makeover Quotes

  1. We buy things we don’t need with money we don’t have to impress people we don’t like.”
    • Explanation: This quote reflects the societal pressures that often lead individuals to make poor financial decisions. People often overspend to acquire material possessions as a way to gain social approval, even if it means going into debt. The quote emphasizes the irony that this spending is often done to impress people who don’t hold significant value in one’s life.
  2. “If you will live like no one else, later you can live like no one else.”
    • Explanation: This quote is a cornerstone of Dave Ramsey’s philosophy. The first part refers to making financial sacrifices in the present, like living frugally and avoiding debt, which most people don’t do. The second part implies that by doing so, you will be able to achieve financial independence and have the means to live comfortably in the future when others may not be able to.
  3. “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.”
    • Explanation: This quote encourages readers to take a strong stance in protecting their financial well-being. It emphasizes the importance of being assertive and making decisions based on what’s best for oneself and one’s family, even if it goes against societal norms or expectations.
  4. “A budget is people telling their money where to go instead of wondering where it went.”
    • Explanation: Here, Dave Ramsey stresses the importance of a budget in personal finance. By creating and sticking to a budget, individuals are actively managing and directing their money in a purposeful way. Without a budget, people often spend without thinking and later wonder why they have no money left.
  5. “You must gain control over your money or the lack of it will forever control you.”
    • Explanation: This quote emphasizes the importance of taking control of one’s financial situation. If you don’t take steps to manage your money, you will always be in a reactive position, dealing with financial stress and constraints. By gaining control over your finances, you empower yourself to make choices that align with your goals and values.

The Total Money Makeover Summary

“The Total Money Makeover: A Proven Plan for Financial Fitness” by Dave Ramsey is a personal finance book that provides readers with practical steps and advice on how to gain control of their finances, get out of debt, and build wealth.

The book is divided into several chapters, as follows:

Introduction: Super Saving

  • The book starts by emphasizing the importance of saving as the foundation of financial fitness. Ramsey suggests that it is important to adopt a new set of values concerning money, rejecting common myths and committing to saving.

Chapter 1: The Total Money Makeover Challenge

  • In this chapter, Ramsey challenges readers to transform their financial lives. He points out common excuses and misconceptions about money and encourages readers to take responsibility for their financial health.

Chapter 2: Denial: I’m Not That Out of Shape

  • Ramsey discusses the denial that many people have regarding their financial situation. He emphasizes that admitting the problem is the first step in the journey toward financial fitness.

Chapter 3: Debt Myths: Debt Is (Not) a Tool

  • The author busts common myths about debt, arguing that debt is not a tool for building wealth. He emphasizes that true financial freedom is possible only when you are not beholden to creditors.

Chapter 4: Money Myths: The (Non) Secrets of the Rich

  • In this chapter, Ramsey dispels myths about wealth, such as the belief that overnight success is common. He emphasizes that wealth is usually built slowly through disciplined saving and investing.

Chapter 5: Two More Hurdles: Ignorance and Keeping Up with the Joneses

  • Ramsey discusses the hurdles of lack of knowledge and societal pressures. He explains that financial literacy is crucial, and that trying to keep up with others’ spending is detrimental to financial health.

Chapter 6: Save $1,000 Fast: Walk Before You Run

  • This chapter introduces the first of the 7 Baby Steps, which is saving $1,000 as a starter emergency fund. Ramsey stresses the importance of having this safety net in place before tackling debt.

Chapter 7: The Debt Snowball: Lose Weight Fast, Really

  • Ramsey explains the second Baby Step, which is paying off all debt (except the house) using the debt snowball method. He explains how to list debts smallest to largest and focus on paying them off in that order.

Chapter 8: Finish the Emergency Fund: Kick Murphy Out

  • Here, Ramsey discusses completing the emergency fund by saving 3-6 months of expenses. This serves as a buffer against life’s unexpected events and keeps you from going back into debt.

Chapter 9: Maximize Retirement Investing: Be Financially Healthy for Life

  • Ramsey discusses Baby Step 4, which is to invest 15% of household income into Roth IRAs and pre-tax retirement funds, to secure a comfortable retirement.

Chapter 10: College Funding: Make Sure the Kids Are Fit Too

  • This chapter covers Baby Step 5, advising parents to save for children’s college expenses using tax-favored savings plans, ensuring their education without relying on loans.

Chapter 11: Pay Off the Home Mortgage: Be Ultra-Fit

  • Ramsey explains Baby Step 6: paying off your home early. He provides strategies for paying down a mortgage faster, thus saving on interest payments.

Chapter 12: Build Wealth Like Crazy: Become the Mr. Universe of Money

  • In this final Baby Step, Ramsey encourages readers to build wealth by investing in mutual funds and real estate, and to be generous by giving.

Chapter 13: Live Like No One Else

  • The concluding chapter of the book focuses on the benefits of living like no one else in terms of financial discipline and frugality, so that later in life, you can live and give like no one else. Ramsey shares inspiring stories of individuals who have achieved financial independence and are now living fulfilling lives with the freedom to pursue passions, spend time with family, and give generously to causes they care about.

“The Total Money Makeover” features several appendices, including budgeting forms for financial planning and a section elucidating the Debt Snowball method for efficient debt repayment. Additionally, it includes Ramsey’s guidelines on income allocation across various categories for a balanced budget and practical advice on saving and investing. Lastly, the book shares inspiring success stories of individuals who have triumphantly applied its principles to overhaul their financial lives.

In conclusion, “The Total Money Makeover” is a comprehensive guide that combines practical advice, motivational encouragement, and success stories to inspire readers to take control of their financial lives. Dave Ramsey’s 7 Baby Steps are at the core of the book, guiding readers through a systematic process towards financial freedom and wealth building. Through budgeting, avoiding debt, saving, and investing, Ramsey asserts that anyone can achieve financial fitness and live a life of abundance and generosity.

Key Principles in ‘The Total Money Makeover’

“The Total Money Makeover” by Dave Ramsey is built on several key principles that serve as the foundation for his financial advice:

  1. Live Below Your Means: Ramsey emphasizes the importance of not spending more than you earn. This is crucial for avoiding debt and being able to save and invest effectively.
  2. Avoid Debt: One of the central tenets of the book is the aversion to debt. Ramsey believes that debt is a hindrance to financial freedom and advises readers to avoid it at all costs.
  3. Use a Budget: Ramsey stresses the importance of using a budget to plan your finances. He believes that every dollar should have a purpose and that being intentional with your spending is key to financial success.
  4. Save for Emergencies: Before tackling debt or investing, Ramsey advises setting up an emergency fund. This serves as a financial buffer and helps avoid accumulating more debt when unexpected expenses arise.
  5. Focus on Behavior Over Math: Ramsey acknowledges that personal finance is more about behavior and discipline than mathematics. Making consistent, wise financial choices is more important than trying to find the perfect investment or interest rate.
  6. Use the Debt Snowball Method: When paying off debt, Ramsey recommends listing all debts from the smallest to the largest and paying them off in that order. This method, known as the Debt Snowball, is designed to create psychological wins that motivate individuals to continue paying off debt.
  7. Invest for the Long Term: Ramsey advocates for long-term investment, particularly in retirement accounts. He emphasizes the importance of starting early and being consistent with investments.
  8. Generosity and Giving: One of the final stages of Ramsey’s plan involves building wealth not just for personal gain but to be generous and help others. He believes in the importance of giving back as part of a balanced financial life.
  9. Stay Committed and Be Patient: Ramsey acknowledges that achieving financial freedom is not a quick fix but a marathon. Staying committed to the process and being patient is essential.
  10. Seek Accountability and Support: Throughout the book, Ramsey highlights the importance of having a support system, such as family or a financial accountability partner, to help stay on track.

These key principles provide a structured approach to achieving financial health and independence as outlined in “The Total Money Makeover”.

How I’ve Implemented The Ideas From The Book

I have been applying the principles from “The Total Money Makeover” in my own life for the past few years. The first step I took was to create a budget, which gave me a clear picture of my income and expenses. This helped me adjust my spending habits so that I could save more money.

I also adopted the Debt Snowball method to pay off my credit card debt in an organized and effective manner, focusing on the smallest debts first and gradually making progress. The sense of accomplishment that came with each payment made it easier to stick to my plan.

Success Stories: Real-world Examples of ‘The Total Money Makeover’

The book gives several examples of how readers have practically applied the principles in “The Total Money Makeover” to overhaul their financial lives. One success story is of a couple who had approximately $50,000 in debt and paid it off within two years by following Ramsey’s advice, which included living on a budget and avoiding all new debt.

Another inspiring example is of an entrepreneur who used the Debt Snowball method to pay off $60,000 of business debt in under two years.

A single parent, struggling to make ends meet and juggling credit card debt, medical bills, and daily expenses, adopts the principles from the book. By creating a strict budget, cutting non-essential expenses, and sometimes finding new sources of income, she managed to create an emergency fund and pay down debt, bringing stability to her family.

The Total Money Makeover Criticism

“The Total Money Makeover” has garnered a large following for its simple, step-by-step approach to financial freedom. However, it is not without its criticisms. One common critique is that the book’s one-size-fits-all approach may not suit everyone’s unique financial circumstances. For instance, Ramsey’s Debt Snowball method, which advocates paying off debts from smallest to largest regardless of interest rates, has been argued by some as inefficient compared to the Debt Avalanche method which focuses on higher-interest debts first. Furthermore, Ramsey’s strong aversion to credit and debt is viewed by some as impractical; critics argue that responsible use of credit is essential in today’s world, and that his recommendation of saving only a $1,000 emergency fund initially may not be enough for many people.

Another area where Ramsey faces criticism is in his investment advice. Financial experts have taken issue with what they see as overly optimistic assumptions regarding stock market returns and his preference for actively managed mutual funds over lower-cost index funds. Moreover, Ramsey’s emphasis on morality and personal responsibility in finances is seen by some as moralistic and failing to acknowledge structural issues such as income inequality and access to healthcare, which can heavily influence one’s financial situation. Additionally, some readers feel that there is a fair amount of marketing and upselling of Ramsey’s other products and services within the book.

Lastly, “The Total Money Makeover” has a distinct religious flavor, with Christian principles and biblical references interwoven throughout. While this resonates with many readers, those who do not share these religious beliefs might find it less appealing. In conclusion, while “The Total Money Makeover” offers actionable advice that has helped many achieve financial stability, potential readers should approach it with an open but critical mind, considering their own unique circumstances and values.


As we have seen, it’s clear that this book has been a catalyst for financial transformation for countless individuals and families. With its no-nonsense approach, Ramsey lays out a road map that is both practical and actionable.

The 7 Baby Steps, with their focus on debt elimination, saving, and wealth-building, provide a solid framework for anyone looking to regain control of their financial life.

However, as with any financial advice, it’s essential to recognize that personal finance is, indeed, personal.

What works for one may not necessarily work for another. Ramsey’s prescriptions, while invaluable for many, might not fit everyone’s unique circumstances, and some of his stances, particularly on credit and investments, have been met with criticism.

Therefore, as responsible consumers of financial information, it is imperative to approach “The Total Money Makeover” as one resource among many. It’s worth considering blending Ramsey’s advice with other financial perspectives and adapting the principles in a way that aligns with your values and circumstances. Most importantly, the journey to financial freedom is often about continuous learning, adaptation, and making informed decisions.

In the end, “The Total Money Makeover” can serve as a powerful starting point or a critical waypoint on your financial journey. Whether you’re drowning in debt, looking to build wealth, or anywhere in between, the principles and stories in this book offer both the tools and the inspiration to make meaningful change. Here’s to your financial makeover and the many possibilities that come with financial freedom and security. Happy budgeting, saving, and investing! 🚀🌟


Does Baby Steps Work?

Yes, the Baby Steps approach outlined in “The Total Money Makeover” has been successful for many people. It provides a structured, step-by-step system of eliminating debt, building an emergency fund, and investing for retirement.

What Is The Average Return On Investment According To Dave Ramsey?

Dave Ramsey does not provide a specific rate of return. Instead, he emphasizes the importance of diversifying and investing in a mix of stocks, bonds, and other types of investments. He also recommends aiming for a reasonable rate of return while avoiding taking on excessive risk.


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