50 pages • 1 hour read
Dave RamseyThe Total Money Makeover: A Proven Plan for Financial Fitness
Nonfiction | Book | Adult | Published in 1994A modern alternative to SparkNotes and CliffsNotes, SuperSummary offers high-quality Study Guides with detailed chapter summaries and analysis of major themes, characters, and more.
Themes
Financial Improvement Is Self-Improvement
The Total Money Makeover is a personal finance book. It is also a personal transformation book. Dave Ramsey refuses to separate financial improvement—the objective of the Total Money Makeover plan—from improvement of the whole person. His reason is that concerning good money management, behavior matters more than information: “[W]inning at money is 80 percent behavior and 20 percent knowledge. […] Most of us know what to do, but we just don’t do it” (4). Foolish behavior, not ignorance, is what Ramsey believes usually causes financial trouble. His second premise is that money behavior is intertwined with everything about a person: “[T]he emotional, the relational, the family history, the socio-economic impacts, and the spiritual. To ignore any of these while discussing behavior change about money is incomplete and very naïve” (xvii). His conclusion, expressed succinctly, is that money is about everything.
This conviction manifests in his discussions of topics that are not strictly financial yet impact financial wellbeing. Delaying gratification is an aspect of emotional maturity that involves more than resisting impulse buying—but it does involve resisting impulse buying, so Ramsey begins his discussion of debt, not by defining debt, explaining different academic theories of debt, or giving statistics about debt, but by connecting it to emotion: “It is human nature to want it and want it now; it is also a sign of immaturity” (17). Marriage is not just about budgets and bills—but budgets and bills test or break many marriages, so Ramsey demands that stubborn husbands sell their fancy cars for the sake of giving their wives peace and insists on the importance of couples agreeing on and holding each other accountable to financial goals (100-01, 142-43). Generosity is a virtue anyone can cultivate: the rich can give money, and the less affluent can give time, affection, and attention. But the rich can give money and ought to according to Christian ethics, so Ramsey advocates for generosity with spiritual arguments—he explains that good people have a moral duty to accumulate and distribute wealth for the benefit of all and that giving brings more happiness than hoarding. He preaches a prosperity gospel: “Every mentally and spiritually happy person I’ve met has been turned on by giving as long as it didn’t mean his own lights got cut off” (212).
It does not follow that all rich people are “mentally and spiritually happy” (212) or healthy in other aspects of their lives. Though Ramsey believes financial wellbeing tends toward wealth, wealth can come by other means, including luck and fraud, and in such cases, other aspects of a person may remain unimproved: “If you are a jerk and become wealthy, you will be king of the jerks” (221). Money is about everything, but the corollary is that not everything is about money. When one undertakes financial improvement, they are committing to facing their weaknesses honestly and making positive change. Wealth may be the result, but it’s the change that matters. Ramsey hopes his readers “have the spiritual character to recognize that wealth is not the answer to life’s questions” (220-21). This admission brings crucial balance to Ramsey’s emphasis on the importance of good financial decisions and the dangers of bad ones throughout the book.
Ramsey expresses both convictions when he says, “Ultimately, we are not defined by wealth; however, your Total Money Makeover will affect your wealth, as well as your emotions, relationships, and spiritual condition. This is a ‘Total’ process” (165). The theme of the relationship between financial wellbeing and personal wellbeing elevates Ramsey’s book from a mere vehicle of information to a potentially transformative experience for readers. The Total Money Makeover isn’t groundbreaking by Ramsey’s own admission, but it may be “life-changing” (xiv).
Motivation Matters More Than Knowledge
In his personal story of going bankrupt, Ramsey paradoxically states, “Hitting bottom and hitting it hard was the worst thing that ever happened to me and the best thing that ever happened to me” (2). It was the worst because he felt miserable; it was the best because that misery drove him to change.
Ramsey explains that undertook a “quest” to discover what financial wellbeing meant and how to achieve it. He describes this quest as a search for knowledge: “I read everything I could get my hands on. I interviewed older rich people, people who made money and kept it” (3). But crucially, emotion—specifically, exasperated dissatisfaction—was what drove Ramsey on his quest, and equally crucially, his turning point was not an intellectual epiphany but a self-confrontation in which his newfound motivation to change conquered his complacency. The book presents a similar challenge: “Are you ready to take on the guy or gal in the mirror? If you are, you are ready to win” (3).
In citing the idea that “[w]inning at money is 80 percent behavior and 20 percent knowledge” (4), Ramsey emphasizes the importance of motivation in directing smart financial choices. This is not a real statistic but a rhetorical device used to illustrate how little financial knowledge matters in comparison to the large amount of motivation needed to succeed. Because of this, a recurring theme of The Total Money Makeover is that motivation matters more than knowledge, that excitement excels logic, and that determination drives change where math does not.
Ramsey admits that, as a financial expert, he understands the value of knowledge and is tempted to try to persuade others with facts and numbers. Indeed, he does so throughout the book, oftentimes with a bluntness that seems unsympathetic. Making no attempt at sensitivity (he prefaced the book with a warning about its political incorrectness), Ramsey identifies most infelicitous financial behaviors as “stupid.” Many such statements are even set apart in the margins under the headline “Dum Math & Stupid Tax.” But he also notes the difference between people, like Lily, who have “survival debt, not stupid, spoiled-brat debt” (107). Ramsey’s ire is directed toward people who squander their opportunities, not people trying earnestly to rid themselves of financial ignorance.
He makes the distinction between motivation and knowledge again in his discussion of the “Debt Snowball” when he explains that he learned to adjust his tactics: “Being a certified nerd, I always used to start with making the math work. […] the math does need to work, but sometimes motivation is more important that math” (114).
This argument explains why Ramsey’s Total Money Makeover motto is motivational: [I]f you will live like no one else, later you can live like no one else” (5). The promise of future reward inspires effort. The motto has nothing to do with rehearsing a piece of knowledge. The argument also explains Ramsey’s preference for describing people who radically change their financial trajectories as gazelle-intense—not as smart, clever, or insightful. The gazelle flees the hunter with an urgency produced by the desire to live. Of course, the gazelle does know the danger of the hunter, and it calculates how to avoid danger even if the calculations are intuitive.
Two caveats to Ramsey’s elevation of motivation over knowledge deserve mention. First, Ramsey does insist that financial ignorance is a problem, an obstacle to a successful Total Money Makeover: “Ignorance is not okay. […] What you don’t know will kill you. What you don’t know about money will make you broke and keep you broke” (81). Second, he consequently recommends that readers do what he did— “go on a lifetime quest to learn more about money” (79)—and repeatedly argues that studying and imitating the lives and habits of rich people is wise. But overall, and particularly in his habit of cheering readers on at the end of each chapter, Ramsey demonstrates a clear appreciation for the power of motivation.
Plain, Practical, Proven Principles
Ramsey wants to inspire his readers with hope and position them for success with a reliable plan. He admits that there is no easy path to wealth, but readers can count on the Total Money Makeover because the financial principles that inform it are simple, practical, and tested. The hike up the metaphorical mountain of financial success is steep and hard, but the trail is straight, clear, and well-trodden.
Ramsey emphasizes the simplicity of his plan: “The Total Money Makeover plan isn’t theory. It works every single time. It works because it is simple” (4). The plan is simple because the principles that define it are saving money for emergencies, only buying what you can afford, putting necessities before luxuries, investing for retirement, and giving money once you are wealthy. These are not “intricate academic theories” (5). Ramsey assures readers that, “The secrets of the rich don’t exist, because the principles aren’t a secret. […] Living right financially […] is not complicated; it may be difficult, but it is not complicated” (53). Some of Ramsey’s more abstract yet still understandable principles include delayed gratification, setting attainable goals, and taking responsibility for one’s finances.
Ramsey’s financial principles are practical—they are unambiguous and actionable for a broad cross-section of people. For individuals whose only obstacles to financial freedom are ignorance and emotional immaturity—Ramsey’s target audience—saving for emergencies, only buying what one can afford, and not putting luxuries before necessities means learning to say no to fancy cars, big TVs, and frequent vacations. Investing for retirement means setting aside 15% of gross annual income in mutual funds. And giving means first having wealth to give, then giving generously and expecting nothing in return. Ramsey tells readers to not gamble, to do research before investing hard-earned money, to apply for scholarships, to avoid student loans, to sell things to pay off debt, to choose 15-year mortgages over 30-year mortgages, and more—all practical advice.
Ramsey’s financial principles are tested, and he positions them as “time-honored truths” (xiv), not novel and theoretical speculations: “Very little that you read in this book will be something that someone else has not written or said. We often say on our radio show that we give the same financial advice your grandmother would, only we keep our teeth in” (xiv). Ramsey emphasizes the simplicity of his financial principles because ordinary people are his intended audience, and ordinary people resist or become discouraged by complicated ideas. The personal testimonies scattered throughout the book give credibility to the assertion that though the journey to wealth is hard, it is not complicated.
