DAVE RAMSEY: Do the baby steps change if the student loan debt is larger than average?

Dear Dave,

I have $100,000 in student loan debt. Since the amount is so large, is there a special place in your Baby Steps plan for it? — Julie

Dear Julie,

The fact that it’s a large amount of student loan debt doesn’t change anything. ” rel=”noopener” style=”color: blue; text-decoration: underline;” target=”_blank”>don’t let this student loan debt hang around for years and years. You’ve got to get focused and intense about getting control of your money. That means living on a strict, basics-only monthly budget. After that, start throwing every nickel and dime you can scrape together and save toward those student loans as fast as possible.

Your income is your largest wealth-building tool, Julie. You can’t save, and plan for the future, when all your money is flying out the door to pay back debt! — Dave

Better late than never

Dear Dave,

I have a credit card that I haven’t made a payment on in almost two years. The debt has been sold a couple of times, and now a collector is saying I owe $1,200. The original amount was $500. I’d like to work something out, but I can’t afford $1,200. What should I do? — Luanne

Dear Luanne,

They’re asking for $1,200 because they’ve added things like interest and late fees. ” rel=”noopener” style=”color: blue; text-decoration: underline;”target=”_blank”>the agreement in hand, send them a money order or cashier’s check for $500. Do not, under any circumstances, give them electronic access to your bank accounts.

You waited too long to take of your obligation, Luanne. That made things more difficult and more stressful than necessary. I’m glad you decided to do the right thing, and clean up your mess, though. Better late than never! — Dave

Dave Ramsey is CEO of Ramsey Solutions. He has authored seven best-selling books, including The Total Money Makeover. The Dave Ramsey Show is heard by more than 13 million listeners each week on 585 radio stations and multiple digital platforms. Follow Dave on the web at daveramsey.com and on Twitter at @DaveRamsey.

COMMENTS