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The Truth About Clark Howard and Dave Ramsey

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Financial Tips When Preparing For Your First Child

July 12, 2020

The Truth About Clark Howard and Dave Ramsey

Recently, I was having a conversation with a friend of mine and we were discussing his decision on whether to move to a new place that would be more financially pressing or to continue to sit back and accumulate more money in the bank before taking the leap. One thing was for certain and it was that he would have to take this step one way or another. During our discussion, I figured out that it was not that he was not ready to take the next step, but rather that he was living in a scarcity mindset. What does this mean and how does this mindset come into your life? I thought this would be an interesting topic to discuss as many people in this world, you probably have heard of like Dave Ramsey or Clark Howard and countless others, strongly believe in this philosophy.

Now, do not get me wrong, their methods to become debt free are certainly justified and many should heed this advice especially when they have mountains of credit card debt, student loans, personal loans, etc. However, perhaps you are in a situation like my friend. Say you are in a good spot financially, how do you leverage what you've learned about personal finance to take that next step, whether it's a new home, car payment, starting a business, investing in a retirement fund, etc. And how do you take that step forward with confidence? I have listed a few points below on what you can do.

  • 3-6 months of Cash Reserve: Whenever someone asks how much cash they should have for a rainy day; 3-6 months of living expenses is the common number thrown around. All people who are in a financially optimal position should have this cash behind them. However, this is not the end all be all rule because everybody is unique and must look at their circumstance individually. So yes, it's good to have this cash on hand, but if you have the opportunity to make a decision that would put yourself in a better position long term and for the future you should bet on yourself. However, most people are not talking about this and in fact are teaching us to live in a state of fear and we all know that when we are in a state of fear, we can't achieve our highest potential.
  • Security: most people will tell you they want security in their life whether it be with their job, family, finances, etc. What they fail to realize is that the security they idolize in other people was not achieved by playing it safe. Most individuals who are at a level of security in any area of their life had to take a chance, a risk, or bet on themselves. You will have to do this too if you want to achieve the things that you believe you are capable of. Ultimately it will be up to you take the chance on something that others might not believe, but this will be what ultimately provides you the security you are seeking.
  • Granular Budgeting: The dreaded B word. It is something that most do not want to talk about. Everyone should be a good steward of your money. However, if you constantly operate out of a place of lack then you will continually stay in that place long term. This is very apparent with budgeting because if you constantly know you make X and can only spend X then you subconsciously are training your mind to stick with those numbers instead of seeing something bigger. The truth is, financially you can budget and save 20% and that will put you in a better place than most. However, if you are truly wanting to build financially you will need to earn more income and that will be the number one driver toward your financial goals.


In summary, it's important to have the proper financial foundation in place like having a cash reserve and not overspending what you make. Use this time as a reflection to consider when was the last time you bet on yourself; the last uncomfortable decision you made? If you can't answer this, then you need to consider a new way of thinking to achieve your highest potential. "To know what life is worth you have to risk it once in a while." Jean-Paul Sartre

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About the author

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Kurt Brucker

Vice President, Private CFO®

Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. oXYGen Financial is not affiliated with Kestra IS or Kestra AS. Kestra IS and Kestra AS do not provide tax or legal advice.

The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra Investment Services, LLC or Kestra Advisory Services, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual.

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Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. oXYGen Financial is not affiliated with Kestra IS or Kestra AS. Kestra IS and Kestra AS do not provide tax or legal advice.

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