It will work better in the long term | Advice

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Dear Dave: My wife and I have a financial dispute. I would like to go ahead and fully fund our Roth IRAs, even though we have about $ 10,000 in auto loan debt. She thinks we should pay off the debt first. We will probably be able to complete one or the other by the end of the year. What do you think we should do? – Mark

Dear Mark: I have to go with your wife on this one. I’m glad you both are having discussions about money and working to make decisions together, but you will never be in control of your finances until you get rid of the mindset that debt is acceptable. Once you lose that idea, you’ll begin to realize that missing a year of funding your Roth IRAs isn’t going to kill you. It won’t stop you from getting rich and living like no one else when you start thinking about retirement.

If you keep in mind that it’s okay to have debt, or you’re going to leave it lying around, it will end up ruining you financially. Earning with money is more a matter of behavior than of math. Don’t get me wrong, you have to calculate the numbers and factor them in, but all of the math components are just theory if the behavior doesn’t kick in.

So yes, I side with your wife on this one. Just follow the Baby Steps plan. Pay off all of your debts except your house and a three to six month emergency spending fund saved and set aside before you embark on a long-term investment. A lot of people will tell you that my method is not mathematically correct, but it will work better in the long run – for your money, your marriage, and other areas of your life! -Dave

– Dave Ramsey provides financial advice as the host of a nationally syndicated radio show, “The Dave Ramsey Show”. Locally, his show can be listened to from 6 p.m. to 9 p.m. weekdays on TALK 104.1-FM WKCT. To learn more, visit www.daveramsey.com.

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