Financial Peace Revisited: New Chapters on Marriage, Singles, Kids and Families by Dave Ramsey

Financial Peace Revisited: New Chapters on Marriage, Singles, Kids and Families Reviews

• 
  Kyle

  Since I've been in the middle of a lot of money trouble, a friend of mine lent me this book as well as a little cash to make it through my next set of bills. I figured I owed him enough to at least read the book.
  I can't tell you how annoying it was to read this thing, which is clearly just a collection of transcribed parts of Ramsey's seminars and radio shows from the 1990s. So he gives us some moderately sound financial advice: Get out of debt, or better yet, don't go into it. Save where you can. Invest in mutual funds once you've saved.
  Beyond those few points, this guy is both irrelevant and dangerously stereotypical. The book doesn't even mention the Internet or housing boom/busts or financial problems of the current economy. He talks about looking for deals as if we've never heard of craigslist (and then proceeds to act like it doesn't exist). I would be okay with this, as the book seems to have been written about 20 years ago, but this is the updated, revisited edition. This man has had time to update things.
  He blathers about how everyone can save and stay out of debt, and yet makes the assumption that everyone is going to find work all the time that will pay at least $30,000 a year, which he classifies as really low-end income. I got news for you, Dave. I (barely) made it on about half that last year, and I am working three jobs. I have more than a half-dozen friends who are in similar situations. He has the nerve to question the maturity of 20-somethings who are still living with their parents or with friends, because they just "aren't working hard enough," and classifies it as a problem with my generation. A great deal of his suggestions will only work if you don't have to continue to go into debt to survive or are even just cutting it close. Saving money and paying toward debt only ever works when something can be cut somewhere to save.
  And the part that made even these socioeconomic gaffs is his ridiculous stereotypical worldview in which everyone is going to get married. The men are going to go and earn money. The women could go out and work, but in some situations should just stay home and take care of kids. They are going to buy a house and have 2.5 kids. He is going to want a car and a boat and she is going to want a kitchen set. He jokes that when he sells houses, he sells women the kitchen and men the basement. You know what, Dave? I'm renting where I am because I like my kitchen and basement. Every chapter is clearly aimed at men, and techniques are sold in the same way. Each chapter is followed by a short, couple-paragraph summary from Ramsey's wife Sharon, who breaks down the ideas for the ladies. In one pretty straightforward chapter about investing, Sharon's section explicitly tells women to ask their husbands to explain it to them. I was sputtering at some of the tripe I read. The sidelong jokes about "Social Insecurity" probably make better seminar quip fodder, and they certainly didn't help me through this book.
  Except for one or two good points, this was absolute drivel, and I didn't even understand some of it. Maybe I should ask my husband to explain it to me.
• 
  C

  Some of my friends are Dave Ramsey fans. The 2 main things I knew about him were his envelope system of budgeting, and his anti-debt stance. I thought I'd find out about these by reading
  The Total Money Makeover. That book covered his anti-debt stance, but didn't cover the envelope system, and it also contained many references to this book, Financial Peace. So although this book was published before The Total Money Makeover, I read it second. The 5 Baby Steps briefly mentioned in this book serve as the overarching outline of The Total Money Makeover.
  
  Ramsey again provides good financial advice for the layman. I like how he tells people to keep it simple, so that they don't get themselves involved in things they don't understand, but they do at least make an effort to improve themselves financially. I also like his practical, realistic attitude about financial matters; you can't rely on the government or other people to bail you out, so you better take care of yourself.
  
  I disagree with Ramsey's stance on debt (see my review of
  The Total Money Makeover). Overall, I think there are much better personal finance books.
  
  Notes
  Here are the notes I made while reading this book:
  Money is amoral, and being poor or rich doesn't say anything about your morality.
  Money magnifies character, good or bad.
  Financial independence is unattainable; handle your money well, and gain as much as you're able, but know that it will never be enough that you can stop managing it.
  Live substantially below your income
  Don't borrow money; even if you pay off your credit card each month, people tend to spend more when buying on credit.
  Use debit cards in place of credit cards.
  If you must borrow, only borrow on short terms and for appreciating assets.
  If you're in debt, pay it off in order of smallest to largest debt (the Debt Snowball).
  Don't borrow to build or clean your credit; just pay what you owe on time.
  
  How to allocate your income:
  1. Give to charities
  2. Pay yourself
  3. Pay bills
  
  Keep a 3-6 month emergency fund.
  Use a sinking fund for large purchases; make payments in reverse by saving a certain amount per month, then paying cash.
  Don't buy individual stocks unless you research stocks for a living.
  Buy level term insurance rather than whole, universal, or variable life insurance.
  Keep It Simple, Stupid; only buy investments that you understand.
  
  Choosing a mutual fund
  Minimum 5-year record, preferably 10-15 years.
  Have a portfolio of the following funds:
  - balanced
  - growth and income (large cap)
  - growth (small and large cap)
  - international
  - aggressive (small cap)
  For a more aggressive portfolio, eliminate the balanced fund
  
  Criteria, in order of importance:
  1. Performance - average annual return over at least 5 years. When comparing, compare funds of same type.
  2. Management of family of funds
  3. Beta - the fund's volatility, compared to the S&P 500 (beta 1.00)
  4. Expense ratio, in light of performance
  
  Disregard whether fund is load or no-load.
  
  Additional advice
  Don't pay taxes on money until you use it.
  For 401(k), invest according to the aggressive portfolio listed above.
  Use UGMA for college savings.
  Never pay full price for anything
  
  Negotiating skills
  1. Offer to pay cash
  2. Be prepared to walk away
  3. Keep telling the salesperson that the deal isn't good enough
  4. Use excuses like your wife or girlfriend not letting you spend that much
  
  Include a "blow" or "waste" category in your budget, because you'll do it and need to account for it.
  Use the envelope system of budgeting: have an envelope full of cash for each budget category, and only spend that amount.
  Allocate or "spend" your entire paycheck before you get it so you control where it goes.
  
  Baby Steps Note: these are more fully explained in
  The Total Money Makeover
  1. Pay the minimum on everything until you have a $1000 emergency fund. This should take 1 month.
  2. Pay off all debt except home
  3. Save 3 - 6 months in emergency fund
  4. Fully fund all pretax retirement savings in mutual funds
  5. Start college funds for your kids
  6. Pay the house mortgage off early. It could be 2 - 4 years before you reach this step.
  7. Get rich with real estate, mutual funds, variable annuities, and opportunity money
• 
  Tinea

  This is a useful, sensible guide to budgeting, paying off debt, and achieving financial stability (like being able to handle medical emergencies) for people with low-incomes, especially people struggling with loan payments.
  
  I'm going to synthesize Ramsey's advice into my own words below:
  
  1. Create an emergency fund. Open a savings account if you don't have one, and put effort into getting $1000 into it as soon as possible, even if it means cutting back spending, taking on extra work, or selling something. Use this money for emergencies only-- stuff like unexpected doctor's bills, car repair, etc. and try to refill it after you use it. Eventually, attempt to have 3-6 months of your budgeted expenses in an accessible savings account, so you don't have to rely on credit cards if you lose your job.
  
  2. Create a budget that reflects both how you live and by what values you would like to live. First, asses your income (and if you have any, your assets... ha!) and your total monthly expenses, including debt and money you spend on fun stuff. Then, figure out what percentage of your income you spend on each category, like food, housing, and recreation. Compare your %s to those Ramsey recommends (and your own ideas). Note, Ramsey suggests allocating between 12% to a quarter of your income to personal and recreation stuff. If you stiff yourself in your budget, you won't follow it, because it won;t reflect hwo you want to live your life. Ramsey also stresses donating 10-15% of your income, even if money is tight. Money is rarely really that tight, and if it is, you can still donate time. (Ramsey comes from a Christian background and urges prayer and meditation too. I appreciated the way he emphasized that you cannot separate personal financial planning from personal values and morals)
  
  Next, create a monthly cash-flow plan (basically, a budget), that allocates all of your income in a given month toward something. Allocate the money whether that something is regular and fixed, like a credit card bill or rent; is monthly but variable (in this case, estimate based on past experience [round up:]); or is irregular-- divide expenses that happen only a few times a year by twelve, so you can be sure to save enough for those expenses when the time comes to pay them. Include savings in your allocated money, and if your emergency fund is all saved up, put that money in something with higher interest, like a mutual fund (see below).
  
  3. Pay off your debt using the "debt snowball." First, list your loans in order from smallest to largest. Pay the minimum on all if you can, but make an effort to put a little bit of extra money towards your loans, and direct that towards your smallest loan. Eventually, you'll pay that loan off. Now direct that loan's minimum payments to the next smallest loan. Once that's paid off, use that money to pay off the next smallest loan, and on. This will get rid of your loans faster then trying to pay off the largest or highest interest loan first.
  
  If you can't afford even the minimum payments, create a "pro rata" plan, which means making proportionate payments on your loans out of an amount you determine you are able to spend, based on your budget. Say after all your expenses, like housing and food, you have $100 leftover that you can use for debt. You then figure out what percentage of your total debt each loan is, and pay your loans based not on the company's minimum payment, but each loan's percentage of your $100. By writing to the company and explaining your budget and pro rate plan, and by making regular payments, most creditors will leave you alone. Ramsey includes some legal info in the book explaining that while you're required to pay your debts, you aren't required to forgo basic living expenses to do it.
  
  4. Get health insurance. First, save up the $1000 emergency fund. Once you have that, shop around to find cheap, "catastrophic" health insurance with a high a deductible and high co-pays. This shitty insurance will be the cheapest and provide the worst coverage for everyday medical expenses, but it will prevent a horrible accident or illness from saddling you with thousands of dollars or more in debt. Then, try to save the amount of the deductible in your emergency fund, so you are prepared to pay medical expenses, and have money available for routine exams.
  
  5. Begin long-term savings. Ramsey suggests saving 10-15% of your monthly income. Put these savings into an account that gets a high rate of compound interest, like a mutual fund. Plan ahead and try to use long-term savings to buy things that you would otherwise need a loan for (or to reduce the amount you'd have to borrow): furniture, cars, travel. Ramsey also discusses saving for retirement, your kids college (save for retirement first-- kids can handle paying off their college loans easier then supporting aging parents), and buying a home. My favorite part about this book is his commitment to having a means within how you live: saving money isn't about becoming extravagantly wealthy, and it's important to donate and otherwise redistribute whatever wealth you accumulate by living modestly and saving a little.
• 
  Christine

  Great read! Lots of tips and tricks about handling money. Definitely a good follow up to Total money makeover.
• 
  Kacy Lou Leyba

  Great financial wisdom, tragically couched in a lot of nauseating stereotypes and a fair amount of culturally tolerated sexism. I’m willing to not throw the baby out with the bath water here, but woof. Not my cup of tea.
• 
  Hannah

  Common sense and practical financial information and advice that most people already know, but don't always follow. The back of the book contains a myriad of worksheets to help you after you read. Dave's wife, Sharon, comments at the end of every chapter, which wasn't very informative or interesting. Otherwise, a decent primer for the average Joe to refresh his financial saavy or learn it new.
  
• 
  Jennifer

  While some info in this is slightly dated the advice remains relevant. While we have slowly and admittedly inconsistently practiced the advice offered, already it has helped me be aware of money like never before. Definitely something or everyone in this book, from the struggling millennial to the baby boomer unable to retire. Financial Peace offers everything in the title and more.
• 
  Lorelei

  I assume that there is a need for a book such as this - in fact I'm sure of it, given how many copies have been sold. But I am not the target audience. There is nothing here that is new to me, and I found it tedious, repetitive and unhelpful. I don't like being this harsh, but it is the truth.
• 
  Leisha Wharfield

  I would like to list here the "baby steps" toward financial peace listed in chapter 21, because that's really all anyone needs to read of this book to get started, but I'm afraid that would violate Mr. Ramsey's copyright, and I won't do that to anyone, especially Mr. Ramsey and his wife, who I respect. Yes, the entire program is founded on Christian belief, which includes tithing to one's church. If you're a pagan like me, you may choose to tithe to charities that provide food, clothing, shelter, education, and health care to those more or less rich than you, to the panhandler on your street, some Kickstarter, Giveforward, or impoverished friend or relative you know is in need. Tithing is a good idea and religious specifics don't matter.
  
  Regarding the book's sexism, widely castigated on GoodReads: it's obvious to everyone, so what can I say? I don't want to ask, "What do you expect from someone who worships a male god whose first two human villains -- Lilith and Eve -- are women, and whose worshipers invented original sin to keep us down?" because obviously we all know Christians who aren't sexist pigs.
  
  The Christian bias of Mr. and Mrs. Ramsey doesn't bother me. I wouldn't not read a book from any religious point of view simply because it's faith-based. I was brought up Lutheran, I'm familiar with scripture, and I gained a lot of wisdom via the vehicle of my church and understand it has no monopoly on the truth. Similarly, we must call out sexism when it arises, but that does not negate whatever positive lesson may arise from the work.
  
  For the majority of U.S. consumers who buy a lot of crap we don't need and can't afford, the advice in this book may be tough to take, and that's a good thing. Ramsey's right: we should live within our means, erase debt, not worship stuff, and generally put money in its place and focus on living a compassionate life in which we take better care of ourselves and each other.
• 
  Craig a.k.a Meatstack

  Dave Ramsey has taken a tested and true set of principles, threw some scripture quotes in, and called it "Financial Peace." And that's fine, because if it helps to get people to get their cash flow under control, more power to him.
  
  As a representative of the genre this book belongs to, it really is not bad. Usually in books of this nature the author will attempt to establish his credibility by telling you, in 1/2 the book, his story. (For extreme examples of this, please see the "4 hour" series by Tim Farris) But Mr. Ramsey does not dwell longer than what is needed. Here's my story, now on to the meat.
  
  But this meat does come with a big stack of fluff. First off, the "Thoughts from Sharon" (his wife) is pointless, and in some cases demeaning toward women. Maybe because I've married and have lived with a very strong woman for 12 years, I was embarrassed by some of what she said. "We women love to shop, don't we?!"
  
  And the "Peace puppies" is just a list of his take-aways from each chapter, but the list continues to contain all the previous notes, so by the end, this list takes up 3 pages.
  
  In the end though - none of that matters. What matters is that the author puts in front of the reader a clear plan and reasons on how his system works. He's done that. Its up to the reader to decide if he/she chooses to follow it, and how devoted to the system that person will be.
  
  And that is the true rating of this kind of book. Not whatever star count I place in this review.
• 
  Indy Hart

  "I get it. Thanks."
  That was my overall feeling while reading
  Financial Peace Revisited. This book is a near copy of the other books pushed out by
  Dave Ramsey. His book "Total Money Makeover" had been suggested to me and then
  read and reviewed before.
  
  
  Financial Peace Revisited had a few extra insights in it that I enjoyed, but I probably wouldn't have done anything more than flipped through it were it not for my reading group.
  
  I might reference his categorical generalizations of the financial decisions people tend to make throughout life, simply as a way to remind myself what to be aware of. Other than that, my overall advice regarding this advice-giving book: if you've read one of his books you've read them all. Take a look at the table of contents, see if there's anything that catches your eye, skim it, and then put it back on the shelf. Who knows, maybe the simple act of not buying the book will empower you with a little extra "financial peace".
• 
  Stephen Lubin

  I got introduced to Dave Ramsey with "The Total Money Makeover" audiobook and I thought it was fantastic. It left me wanting more and I immediately started Financial Peace. Financial peace is a good book, it has solid financial advice and if someone can incorporate the principals in their life then they will be better off. Although the principals are simple and straightforward they are hard to consistently practice... at least they are for me.
  
  Unfortunately for me, this book is not nearly as good as "The Total Money Makeover" Dave Ramsey narrates TMM and he crushes it. He skips a lot of extra detail and delivers the main points succinctly and well. In Financial Peace the narrator does a bad Dave Ramsey impression and there is a lot of extra fluff and it's a slog to get through.
  
  I really like Dave Ramsey and will continue to consume his content but I'm very glad I don't have to read Financial Peace anymore.
• 
  Suzie

  I read this book in 2005 while attending "Financial Peace University" at my church. The combination helped me change the direction of my financial life, motivated me to pay off all my debts, helped me become a much better saver, and equipped me with the knowledge to help several of my friends become debt-free too! I highly recommend this book and the FPU course to anyone that does not have a financial plan for their life, and I am more than willing to share what I have learned and help you get to FREEEEEDOM too. : )
• 
  Jermaine Gayle

  Found the author's podcast recently during one of my long trips on the road. After listening I was determined to get a hold of this book. Now that I've read it, I do see the need for proper management of what God has given to us in the form of money. Money is a gift and the principles outlined here are a good guide to managing your finances. This is a must have if you are; trying to stay out of debt, trying to build wealth, and ultimately trying to serve God with what He has allowed you to have.
• 
  Ana

  Overall this was okay, but you can really tell it was written in the '90s (
  Men Are from Mars, Women Are from Venus, urgh!), but the principles are sound. But I recommend either listening to the podcast or just watching the Financial Peace course online since that's more 21-century friendly.
• 
  Bruce Thomas

  Geared for a bit simple-minded audience.
  
• 
  Carol Blakeman

  Not a lot I hadn't heard before, but a good review and written in a way that is engaging with good real-life examples.
• 
  Talia

  About a decade ago, my dad went to the Financial Peace classes and learned about Dave Ramsey's ideas about money. He talked about it and we as a family began to listen to the idea that things could be done differently. Fast forward, and here I am reading this book. I've listened to a lot of Dave Ramsey's radio show and YouTube videos on top of hearing what others had to say about going debt-free and being able to still live.
  
  Because of all this background, and seeing my family go through stupid nonsense over credit, I'm very interested in the debt-free lifestyle and that's why I wanted to read this book and dig a little deeper.
  
  Some of the questions that I either hear on Dave's radio show or see in YouTube comments are addressed in this book. For example:
  

  What if I'm self-employed or don't have a way to predict my income each month?
  
  What about single parents?

  
  
  If you want to know more about Dave's whole system and answers to these questions, get this book. I've been paying attention to this for a long time and didn't know the answers to some of these questions either.
  
  This book also mentions finding what you're great at so you don't have to work a crappy job your whole life. This is one area that I think is so important for people, if they can, to strive towards. Sometimes you don't get the opportunity to have a job you love for a few years or maybe it's just not plausible yet, but it makes your job feel so much more like an enjoyable process instead of a waste of life.
  
  Dave also brought up some good points about people wanting to reach their parents' levels of wealth so quickly after getting married, but instead acquiring so much debt. Many of us forget that our parents worked a long time to get what they have, and many if us just think we'd like to have it now instead.
  
  Some reviewers also mentioned that Dave was being sexist towards women. However, in every area so far into the book where Dave has discussed the differences between male and female, have been quoted from other sources. I don't agree with a lot of these "blanket statements," but I don't necessarily think they're sexist. Men and women are different but we as a society think its bogus to dare point it out because of "sexism." It's fine that we're all different! What comes across as sexist to me personally is acting like other people are stupid or insignificant because of their chromosomes. That's sexist. None of this comes across as that to me as I'm reading this book.
  
  Further into the book, Dave gives a few generalized ideas for men communicating with women and women communicating with men. These are generalized and may tick off some people because "everyone's not like that," and I agree. The point is to get your wheels turning on how to get a spouse on board with living a better life financially. You don't need to do everything Dave says to the letter.
  
  Dave also mentions that it's sexist to leave the woman in the relationship out of financial matters "because she's a woman" just as it's sexist to leave it all with the woman to deal with because she's "modern" or whatever. It's a joint effort.
  
  One thing people don't seem to think about is having Blow Money. Dave says you're gonna do it anyways, so you might as well plan for it. I think that's a great idea, that way if doesn't always feel like you're working for free if you're just saving, saving, saving.
  
  He also dives into Mutual Funds, ESAs, etc. but he is not overly descriptive with these and I still don't totally understand all of it as it's new to me. However, these can be learned about from other sources and this book is not totally about mutual funds, etc. It's more about getting your money as a whole under control.
  
  Dave has a section dedicated to the Baby Steps, which I appreciated because it went deep into what each step should look like. Personally, I hesitate to jump on board with all the steps (anything that involves a bank as we know that they do not keep your cash on hand and this was a big problem during the Depression), however, I'm not quite willing to say it's totally wrong either. I think spreading your wealth to non-banking areas like land, seeds, gold, etc. should be looked at too. If we look back in history, in Germany, money was so worthless that it was cheaper to use it for the fireplace than to use it to buy anything. So that is why I hesitate in putting all the eggs in one basket.
  
  Towards the end of the book, there are forms to fill out to help you get your finances together. These forms include:
  
  • Healthy Financial Plan -- this covers Insurance, Giving, Teaching Your Children (about money management), Emergency Funding, Will/Estate Plan, etc. and the dates you want to have these things taken care of.
  • Consumer Equity sheet -- this covers Real Estate you own, Cars, Accounts, Stocks and Bonds, Jewelry, Debts, etc.
  • Income Sources
  • Lump Sum Payment Planning -- similar to Sinking Funds
  • Monthly Cash Flow Plan forms
  • Irregular Income Planning
  • Breakdown of Savings
  Among others.
  
  Do I think this is the end-all, be-all? Not necessarily. But it's a great financial resource to have. It's kind of like the beginner, basic book for getting your feet wet. I like how it has a simple plan to get you going. I also recommend checking out the Dave Ramsey Show on YouTube and Rachel Cruz's (his daughter) channel as well. Many times, they'll talk about different scenarios and problems that you and I might be dealing with as far as finances. Their channels are more up-to-date than this book, which was published in 2003 and talked about using checks at the grocery store -- we all know that isn't really happening anymore!
  
  A great resource and very helpful for beginning a money-management journey.
  
  4 stars.
• 
  Chad

  I read a Ramsey book a few years ago, and it was really good financial advice, so I decided to give this one a listen, to refresh my mind on some of his principles. He has great ideas, some are very extreme though. His money saving stuff is good advice for all of us, but when he says to sale the car and pay off the loan and then buy a junker that you do not have to have payments for, I have a hard time. Junkers, in my experience, have been money pits for me. Basically, I listened to his book and I have piecemealed some of his principles that will work best for me. With his pointers, those who struggle with money should be able to get a handle on it. If you are like me and feel like you are good with money, you can still pick up some good practices from this and his other books!
• 
  Stephanie

  Although this is an old book and some of the things in here are old/outdated, this is still a great book and has a lot of learning opportunities for you.
  I had already read one of his most recent books, but one of my friends gave this book to me, so I decided to check it out! I enjoyed hearing Dave's wife's thoughts on these things as a spouse at the end of chapters. If you need some help with your finances, this is a great way to start, and I would suggest you continue on and read more of his books, like Total Money Makeover!
  
• 
  Maddy B

  I had to read this for school but I really enjoyed it. It's definitely a book that has helped me understand money a little better and I HIGHLY recommend that every person read it.
• 
  Omgema Dut

  It was a quick and easy read. I liked that he kept the concepts simple and instructions are easy to follow, lots of great advices for novices like myself.
• 
  Sarah

  Great principles for managing money.
• 
  Karisa

  This was our annual finance book, and John and I started reading without realizing how long ago it was written. This was like watching a movie from the 80s, with the fuzzy resolution, crazy outfits and teased bangs. Even though some of the finance advice was irrelevant (like balancing a checkbook), and the stats and examples were all outdated, the gist of the ideas remain true today.
• 
  Jayde Schwerin

  Dave Ramsey is truly a brilliant author. Another excellent book.
• 
  Angela Powell

  Good, but very similar to Total Money Makeover.