Regardless of what type of business you start, they all cost something: in time and money. Depending on what type of business you’re starting the startup costs can range from the hundreds up into the millions, and it can be a challenge to decide how you’ll fund your new business, and it doesn’t matter where you’re starting from.
Some people muster their grandiose business idea while living paycheck to paycheck with little to no extra cash to invest, and others, find ways to get cash infusions like debt, equity funding, or borrowing money from friends and family.
Dave Ramsey, is a radical money evangelist who advocates for self-reliance and teaches how to live below your means, pay off debt, and scale your lifestyle after investing and saving, but can this method work if you’re an entrepreneur with a big dream? That’s what we’ll be talking about in this post.
- 1 The Dave Ramsey Budget Backstory
- 2 Dave Ramsey Budget | What is it?
- 3 Dave Ramsey Budget | Who’s it For?
- 4 Dave Ramsey’s Followers and their Business Funding Success Stories
- 5 Dave Ramsey Budget | How To Do It
- 6 Dave Ramsey Budget | Products To Help You Get Started
- 7 Final Words on Dave Ramsey Budget
- 8 Now, it’s Your Turn…
The Dave Ramsey Budget Backstory
Like many young entrepreneurs, Dave Ramsey was very ambitious in his youth. He was taught work ethic and had the inclination to go into business at a young age. His parents started instilling the concept of earning money at 12 years old by taking him to a print shop and getting business cards for a lawn care service.
As a result, he learned customer service and many other business skills very young. When he graduated high school, he started selling real estate. In his early 20s, he started buying and flipping real estate. He had a real estate portfolio of $4 million worth of real estate, and $3 million dollars worth of debt. By many standards, he was wealthy.
He was bringing home $250,000 per year after taxes, and he and his wife were able to live comfortably. Abruptly, his banks were sold, and some were simply tightening up because of economic shifts. His banks called all of his notes; forcing him to repay all of his loans instantly. They lost everything, and were forced to file bankruptcy.
Then, they turned to the Bible for knowledge about personal finance. The Dave Ramsey Budget was born as the Ramsey family relearned principles that enabled them to climb back up the economic ladder, and stabilize their wealth. Now, Ramsey Solutions, Dave Ramsey’s business empire, has 13 million radio listeners per week, hundreds of thousands of book readers, and filled events all over the US several times per year. You can hear the entire backstory on this video here:
Dave Ramsey Budget | What is it?
The Dave Ramsey Budget is a zero-based budget, therefore, if you have $5000 in income, you would add every dollar into an expense line item until you have $0 left. Some of the line items could be:
- Shelter line items
- Transportation line items
- Healthcare line items
- Business investment line items
- and, Other investing
Dave says you need to “tell your money where you want it to go”, or it will run away and you won’t know what happened to it.
Dave Ramsey Budget | Who’s it For?
The Dave Ramsey budget is for people who want to:
- Cut debt
- Accumulate wealth
- Live debt free
- Invest for retirement
- and, stabilize a self-reliant wealth stream
Dave Ramsey’s Followers and their Business Funding Success Stories
Dave Ramsey listeners and readers have SEVERAL success stories. Some very notable success stories can be heard in Dave’s Millionaire Hour.
In Millionaire Hour, people call from all over to share their stories of being everyday employees and employers who have a net worth of $1 million or more. These people are proponents of bootstrap business and self-reliant personal finance. This playlist will show you some very notable millionaire hour episodes:
Dave Ramsey Budget | How To Do It
Dave Ramsey’s course Financial Peace University (FPU) is the most comprehensive course that explains how to apply the Dave Ramsey Budget. It comes with budget worksheets, video courses, prompts, the Dave Ramsey “envelope system” and more.
It walks you thru the Dave Ramsey Babystep System which starts with: 1. A $1000 Emergency Fund 2. The Debt Snowball 3. Filling the Emergency fund with 3-6 months of savings 4. Invest 15% into a Roth IRA 5. Save for College 6. Pay off Mortgage 7. Give Financial Peace University also helps you to overcome common obstacles that deter some people from succeeding in the BabyStep System.
These are other articles that may be relevant to your journey to pursue budgeting and bootstrapping your business:
- How to Budget and Save Money for Your Business
- Why Bootstrapping May Be the Best Option for Funding Your Business
Dave Ramsey Budget | Products To Help You Get Started
The most noteworthy products by Dave Ramsey to help understand and apply the Dave Ramsey Budget are the Total Money Makeover and Financial Peace University.
The Total Money Makeover:
Financial Peace University Homestudy:
Final Words on Dave Ramsey Budget
The goal of this article was to show examples of how the Dave Ramsey Budget can work to fund a business. You don’t have to follow all of the buzz and hype about external funding if you don’t want to. There’s lots of freedom by bootstrapping your business, applying good sound budgeting principles, hard work, and discipline.
If you have questions or concerns about this, don’t hesitate to leave them in the comments section. I’d love to help you out! If you would like to start or scale your business, check out my free e-course. It’s a framework to help you grow your business: from idea to enterprise. Check out my free e-course here.
Now, it’s Your Turn…
Have you or someone you know tried the Dave Ramsey budget? Have you used it to save for business? What are your thoughts on the Dave Ramsey Budget. Leave your comments below.