[Book Summary] Baby Steps Millionaires—Dave Ramsey

Rating: ★★★★☆

(Written with aid of ChatGPT)

Baby Steps Millionaires by Dave Ramsey is a practical guide for achieving financial independence and building wealth using a step-by-step approach. Ramsey argues that becoming a millionaire is not reserved for the elite; it is achievable for anyone who is disciplined, consistent, and willing to follow his proven "Baby Steps" system. 

The Baby Steps Framework

1. Save $1,000 for a Starter Emergency Fund:

This is easy to understand and follow.

2. Pay Off All Debt (Except the Mortgage) Using the Debt Snowball Method:

List debts from smallest to largest, pay them off aggressively, and build momentum as you eliminate each one. Mentioning this is understandable considering the widespread credit card over usage in the United States.

3. Save 3–6 Months of Expenses for a Fully Funded Emergency Fund:

Create a safety net to cover major life events or job loss. Prepare for disasters like COVID-19.

4. Invest 15% of Household Income in Retirement Accounts:

Begin building wealth by consistently investing for the long term. Matching>Roth>Traditional.

5. Save for Your Children’s College Fund:

Not applied to me yet.

6. Pay Off Your Home Early:

Focus on eliminating your mortgage to become completely debt-free. Looking at the crazy price tags in 2024, should you buy a house? Or retire in Thailand or China?

7. Build Wealth and Give Generously:

Once debt-free and financially secure, invest and give back to others. It also provides tax benefits!

Pain Plus Reflection Equals Progress—Ray Dalio

Although not directly quoted in this book, Ramsey echoes a similar sentiment throughout *Baby Steps Millionaires*. He emphasizes that financial setbacks, mistakes, and struggles can serve as valuable learning experiences if one takes the time to reflect and adjust their approach.

《財務自由之路：Dave Ramsey的Baby Steps Millionaires》是一本實用指南，透過逐步的方式幫助讀者實現財務獨立並累積財富。Ramsey認為，成為百萬富翁並非精英的專屬權利；任何人只要具備紀律性、持之以恆，並願意遵循他已證實有效的「Baby Steps」（嬰兒步驟）系統，都能實現這一目標。

Baby Steps框架

1. 存下1,000美元作為初步的緊急基金：
   這是容易理解且可執行的第一步。

2. 用「債務雪球法」償還所有債務（不包括房貸）：
   列出所有債務，按照金額從小到大排序，集中資源優先清償金額最小的債務，逐步建立償債的動力。提到這一點是可以理解的，特別是考慮到美國信用卡過度使用的普遍現象。

3. 存下3到6個月的生活費，建立全面的緊急基金：
   建立一個安全網，以應對重大生活事件或失業的情況，例如COVID-19這樣的災難。

4. 將家庭收入的15%投入退休帳戶：
   通過長期穩定的投資開始累積財富。作者建議的順序為：公司匹配計畫 > Roth IRA > 傳統IRA。

5. 為孩子的教育基金存錢：
   （對我來說，這一步目前還不適用。）

6. 提前償還房貸：
   將重點放在還清房貸，實現完全無債一身輕。考慮到2024年瘋狂的房價，是該買房還是選擇在泰國或中國退休呢？

7. 累積財富並慷慨地回饋社會：
   當你實現無債務且財務穩定後，進一步投資並幫助他人。這樣做還能帶來稅收優惠！

痛苦加反思等於進步—Ray Dalio

雖然這本書中沒有直接引用Ray Dalio的這句話，但Ramsey在《Baby Steps Millionaires》中反覆強調了類似的觀點。他指出，財務上的挫折、錯誤和困難可以成為寶貴的學習經驗，只要你願意花時間反思並調整自己的策略。