FPU Lesson 1 – Super Savings

Ever since my I wised up and started taking my family’s money seriously, I’ve become intentionally focused on teaching more and more people how to do the same. Currently, I coordinate a session of Dave Ramsey’s Financial Peace University twice a year through a local church. It’s an awesome way to give people the basic financial building blocks they need to start changing their lives.

I’m in the middle of leading another session of FPU even as I type this, and I thought it would be interesting to share my notes from each lesson here. These are the key points that I highlight from the video when leading the class, plus any supplemental material that I think could help the class go further on the topic we’re covering.

Lesson 1, Super Savings, is all about the practice of saving money. The video covers the excuses we have for not saving, the reasons why we should save, and what kinds of things we should be saving money for.

Key Points

Saving must become a priority. You must learn to pay yourself first*. Savings have to come off the top of your stack when it first comes in, not from the bottom.You can’t effectively save from what remains after you pay for everything else in your day to day life.

*Standard Christian Disclaimer (SCD):  after your tithe.

You must save for an emergency fund, major purchases and wealth building. There are three things that money has to be set aside for:

• An Emergency Fund is insurance that guards you against major negative financial events. Start with $1000, eventually build it up to number representing several months of expenses.

• When you can’t pay for something out of your regular monthly income, that’s a Major Purchase. Make a plan to save up for several months and pay cash for it, instead of going into debt to have it now, which will always cost you more.

• Don’t neglect Building Wealth for the future. Given a reasonable income and the power of compound interest, hardly anyone should ever reach old age broke.

Money is amoral, but you must approach it with the right attitude. Having a lot of money will not automatically make you greedy, stingy or evil. The attitude you have with few resources will be same attitude you will have with many resources. Learn the right approach now.

It’s not over until you quit. You must start saving NOW. It doesn’t matter if you’re 18 or 85, saving is a fundamental part of healthy money management. It’s never too late to start saving.

Next week we’ll cover Lesson 2 – Relating with Money. How to make discussions about money a healthy part of your relationships.