Dave Ramsey inspired us to budget for the first time after 17 years – we just paid off our mortgage

A Reddit user has hit a major financial milestone, and he says he has Dave Ramsey to thank for it. The Redditor explained that he and his wife listened to a lot of Dave Ramsey shows while on a cross-country family trip. They found his advice so inspiring, they made the first budget they had ever created in over 17 years of marriage. 

That budget opened up the door to accomplishing an important goal: Paying off their mortgage early. Here’s how it happened, and some advice on using budgeting to accomplish your own goals. 

How a budget opened up the door to early mortgage payoff

According to the Redditor, he and his wife earn an income that is slightly below the median, and they were debt-free other than their home loan when they decided to listen to Ramsey’s advice and make a budget for the first time.

Since they didn’t have any other debt, they decided they would try to pay off the house ASAP and created a pretty tight budget in order to make that happen. While they took a low-budget vacation or two, they were very consistent with putting as many of their extra dollars as possible toward the mortgage — and, when the original poster (OP) got a raise, they redirected that money to mortgage payoff instead of increasing their expenses. 

Their hard work ended up paying off, and although they are only in their 40s, they now own their house free and clear. This was all thanks to the fact that they were able to take control of their spending and reallocate money to making this dream happen instead of wasting it on other things — which is what often occurs if you don’t have a budget and a job for the dollars you are earning.

How to make a budget to accomplish your own goals

Following Ramsey’s advice on budgeting helped this couple to pay off a home loan ahead of schedule because that was what the OP and his wife wanted to do. However, budgeting can help you to achieve a wide variety of goals, from paying off debt to saving for a college education for your kids, to building a secure retirement.

When you make a budget, you make a conscious choice about how to spend your money based on what you value the most. You can eliminate some expenses that aren’t necessary, or that have gotten out of hand, and make sure you prioritize your goals first ahead of wasteful spending.

There are a few ways to make a budget, including:

• Using a zero-based budget that assigns a job to every dollar so your spending and savings categories add up to the full amount you make. 
• Creating a 50/30/20 budget, which simply says to save 20%, keep fixed costs to 50% of income, and reserve 30% for discretionary expenses. 

The second option is obviously quicker and easier, but if you have a hard time managing your spending, the first option may be best. You can also work with a financial advisor to help you define your goals and build a budget based on them, using the appropriate budgeting method that is most likely to work for you. 

Whatever approach you choose, hopefully, creating your own budget will help you to achieve your goals just as the OP was able to do when he followed Ramsey’s advice and his first budget in 17 years opened up the door to a paid-off home. 

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