Do you like the Dave Ramsey Baby Steps or the Crown Money Map? Dave Ramsey created the Baby Steps and Crown Financial Ministries created the Money Map for prioritizing and setting financial goals.
If you’re just joining, this is article #7, the round up article. It is the last in a series about The Baby Steps and Money Map. With each post I’ve stepped through the phases of both approaches, discussed my observations, hopefully, stimulated your thinking and raised some questions for thought.
In this final post I plan to bring both approaches together and discuss the ultimate benefit in following either one of them for your plan. But first, I’ll list the first six phases of the Baby Steps and Money Map.
- $1,000 In An Emergency Fund
- Pay Off All Debt With The Debt Snowball
- 3 To 6 Months Expenses In Savings
- Invest 15% Of Income Into Roth IRAs And Pre-Tax Retirement Plans
- College Funding
- Pay Off Your Home Early
- Begin using a spending plan & save $1000 for emergencies.
- Pay off all credit cards and increase savings to one month’s living expenses.
- Pay off all consumer debt & increase savings to 3 months living expenses.
- Begin savings for major purchases (home, auto, etc.). Begin saving for retirement. Begin saving for children’s education. If you want to start your won business begin saving for it.
- Buy affordable home. Begin prepaying home mortgage. Begin investing wisely.
- Home mortgage paid off. Children’s education is funded. Confirm estate plan is in order.
Baby Step 7 – Money Map Destination 7
What does the Baby Step say?
- Build Wealth and Give.
What does the Money Map say?
- My retirement is funded.
- I am free to to be more generous with my time and money.
Observations and Questions
- The Money Map scripture in this destination is Matthew 25:21. “Well done good and faithful servant.”
- Obviously, both plans come together in the final phase with the key theme of giving and building.
- Are you in pursuit of a final destination of financial freedom and giving more, or is your pursuit more focused on short – term gratification?
Round Up
The ultimate benefit in following either of these two approaches is financial freedom. You see, there is no longer a need to get rich or pursue quick money making schemes or chase after fruitless desires. Most of those things, if pursued, without living from heaven backwards don’t produce anything but a pile of problems. Don’t misunderstand, I don’t have anything wrong with having toys, fun vacations and more, but pursuing these things without a plan for the future (for financial freedom) is exhausting. They never lead to financial freedom.
These approaches bring focus and precision to financial goals. You can’t get to a destination if you’re constantly taking a wrong turn or getting distracted along the way. No, you must have a map, or steps to guide your direction. You have to know the impacts of stalling out. For instance, if I continue to acquire debt, or don’t make progress towards paying off my debts, I’ll probably never have enough for retirement and to ultimatly build wealth, give more, etc.
My wife and I made a decision a long time ago to pursue a financially free life. A life in which we could give more of time and money to help others. I know that we can only get there by following the course presented by these two approaches. Wouldn’t you agree it would someday be great to hear, “well done good and faithful servant?”
Is either approach right or wrong? Which one is better? In my opinion, neither approach is right or wrong. The one that is better is the one that fits your situation. That sounds like a bit of a cop out given the content I’ve posted recently around this dance, but it’s true. To be honest, I’ve found a combination of the two phases that I find works best for our family (upcoming post).
So, what do you find works best for you? Are you into Baby Step’n or Money Map’n?
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