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Old 10-05-2012, 09:43 AM   #79
KrisM
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Join Date: Aug 2006
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Re: Dave Ramsey Support Thread Oct 1 - Oct 7

Quote:
Originally Posted by hsleonard View Post
List them out individually. DR says any loan that is half of your yearly income gets moved to step 6. If you have ones that fall below that put them in step 2...pay minimums on everything but the smallest, put as much money as you can towards it each month, once it is done move onto the next.
My total student loan debt was around 71K we put it in our debt SB with everything else because the individual loans were smaller than 1/2 our yearly income
DR says a second mortgage more than half your income can move to step 6. He says student loans are always BS2. He does say you can have a bigger BEF than $1000, but that means maybe $3000, not a ful 3-6 months.

From his site:
"QUESTION: Penny and her husband have a $33,000 student debt. They bring home $50,000 a year and she wants to know if they should have a bigger baby emergency fund since itís going to take them so long to pay back the student loan. Should they sell their home to pay off the loan faster?

ANSWER: Since itís going to take you so long to pay off that student loan, you should go back to Baby Step 1 and build up your emergency fund to about $3,000. Then go back to Step 2 and finish paying off the student loan. Youíre going to be at it for a while on your income, so you need to have more of a cushion in savings."
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