I just finished Dave Ramsey’s book – The Total Money Makeover: A Proven Plan for Financial Fitness. I basically used this plan to get out of 40 thousand dollars in debt and now I actually have a decent amount of savings and a retirement account for the first time in my life.
The 7 baby steps are as follows:

Step 1 – Save $1,000
Step 2 – Pay off all of your debt, except your house (if you have one)
Step 3 – Save up 3 to 6 months of expenses (about $10,000 on average) for emergency fund
Step 4 – Invest 15% of household income into retirement.
Step 5 – Start a college fund for your children (if you have them).
Step 6 – At this point, you are debt free, have a nice emergency cushion, are saving at least $500 per month for retirement, and saving $167 per month for your child’s college fund if needed. Next, if you have a home, pay it off early.
Step 7 – Finally, build wealth and give. Once you have done steps 1-6, it’s time to start giving back as well as continuing to building your wealth.

Tips: Don't expect to get out of debt overnight. Don't go for those debt consolidation schemes. Create a monthly budget and a spending plan. Track your expenses.

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