Today, we’re taking a look at one of the biggest roadblocks people encounter on their way to achieving Baby Step 1; on Page 9 – 10 in Chapter 1 of Dave Ramsey’s Complete Guide to Money.
And here’s my lesson for the day:
For you to start winning with money, something’s gotta give.
Chapter 1, titled Super Saving: Common Sense for Your Dollars and Cents, continues on Page 10 with what Dave refers to as The Pain of Change.
You’ll remember that we started discussing in detail, Baby Step No. 1 – Put $1,000 in a Beginner Emergency Fund, from the last post.
And as we’ve established before, to win with money, it’s not just enough knowing what to do, you need to master the behaviors that come with knowing what to do.
In other words, winning with money = 20% information + 80% behaviors.
So, what does The Pain of Change actually mean?
Well, according to Dave, putting $1,000 aside as an emergency fund might sound simple on the surface, but he’s found that a lot of people find it really hard to do.
Because the idea that someone will just put aside $1,000 and not touch it, except only for emergencies, sounds strange to a lot of people.
To these people, it looks like, without that $1,000 being used on bills or expenses, their whole world will come crashing down.
And so, even though it’s easier to say ‘let’s put aside $1,000 in a beginner emergency fund’, you’ll need to actually ask yourself the honest question: what habits am I willing to give up to make that happen?
Because here’s the deal: for you to win with money, something’s gotta give.
If you find yourself in deep financial mess, know this: the financial behaviors that brought you here won’t bring you out on the other side.
If you’ll take a minute to process things, you’ll start to see the habits and behaviors (that you may not notice at first glance) that brought you into this financial mess.
And the truth is: you’ll need to commit to changing those behaviors, if you’re ready to start digging yourself out of that financial hole.
You can’t keep doing more of the same things that brought you into this financial mess… and expect different results.
Which is where Baby Step No.1 comes in.
Baby Step No. 1 lets you start somewhere reasonable.
Which means, you don’t need to worry about putting away 50% or 90% of your pay right now.
All you’ve got to do is focus on putting away $1,000 and not touch it except for emergencies.
Please realize: If you can achieve Baby Step No. 1, you’ve achieved a new level of success with your money.
I’ll be the first to tell you this: change doesn’t happen overnight.
You can’t go from not saving anything and living paycheck-to-paycheck… to suddenly saving 80% of your take-home pay.
Because that means… you’ve followed through on your commitment to:
- look away from a lot of distractions calling for your money
- watch Netflix instead of working on your side hustle
- work on ways to make an extra $1,000 this month
And not just that, you didn’t make that $1,000… and spend it yet again on another bill or unnecessary item.
No, you gathered the $1,000, and you stashed it away in a separate savings account, only to be used strictly for emergencies.
If you’ve been able to do this, bravo to you!
And although you may not realize it yet, you’re starting to master the inner psychology of winning with money.
Because, you’re not just learning about financial freedom, you’re also bringing your mind and body under control to apply what you’ve learned.
On the flip side, if you’re finding it hard to come up with that $1,000, know this:
Something’s gotta give.
I mean, you need to ask yourself:
“What am I willing to give up, to be able to come up with that $1,000 for my beginner emergency fund?”
- Am I willing to give up some hours of TV time – to consistently work on my side hustles from 6 pm – 12 midnight, so I can earn more?
- Am I willing to give up few hours of sleep – to wake up early and put in solid hours of work before heading out to my day job?
- Am I willing to give up some of my comfort – to move out of my apartment and live with roommates, so I can save that balance from my rent?
- Am I willing to get off my cozy couch – to deliver groceries for hours and not spend that money, so I can earn and keep more?
- Am I willing to discipline my mind – to resist the temptation to spend the money I’ve earned on luxuries, things I don’t really need, or on unnecessary junk?
- Am I willing to let go of a lot of items I own but don’t use – to sell at a garage sale, so I can set the money aside for Baby Step No. 1?
So, I ask you: Are you willing to give up your current behaviors and master new ones, so you can reach your financial goals?
Because it might feel comfortable to not want to change, and expect for $1,000 to just show up in your bank account by month’s end…
… but don’t be surprised if you don’t change your behaviors, if you’re still spending everything you make (and then some)…
… and then, one month from today, you still can’t come up with that $1,000 for that emergency fund.
Don’t be surprised.
Because now you know exactly why that didn’t happen.
You haven’t followed through on what you need to give up.
See, I know it’s an uncomfortable conversation to have, but if you’re truly ready to achieve financial freedom, here’s what you must realize: you’ll need to intentionally make many sacrifices to achieve that goal.
Because: For you to start winning with money, something’s gotta give.
If it were easy, everyone would be financially free.
Achieving financial freedom is not easy, and some things and behaviors need to go, so here’s the big question:
For you, what will those things and behaviors be?
That’s all for today, my friend. We’ll be continuing with the next section in the second section of Page 10 of the book tomorrow.
See you then.