5 Best Dave Ramsey Money Tips To Adopt in 2025
Written by
Cara Danielle Brown
Edited by
Amber Barkley
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Personal finance expert Dave Ramsey has become one of America’s most trusted voices for individuals wanting to learn how to take control of their money. From paying off debt to getting on a budget, Ramsey’s guidance has helped millions become educated and empowered.
With 2025’s financial climate off to a strong yet erratic start, some are looking to the finance guru, wondering which of his money tips are most useful to adopt in real time. Here are five that could help put you on the right path.
Pay Off Your Debt
“One of Ramsey’s foundational principles is eliminating debt,” said Melanie Musson, insurance and finance expert at Clearsurance.com. “Instead of seeking out new debt, people should seek to pay off their debts and avoid borrowing more. … Avoiding debt allows you to live freely.”
Consider the current climate: Interest rates remain high at 4.25% to 4.5%, and the Fed has indicated they are in no rush to lower them. Additionally, the global economy is facing uncertainties by way of geopolitical tensions and fluctuating currency values. And, according to Federal Reserve Data from November 2024, big banks are charging the average consumer 22.8% interest on credit cards.
Failing to pay down debt at any time — but particularly in the current economy — will quite literally compound the problem.
Thomas Alessi, president at ARIES Foundation for Financial Education, supports Ramsey’s debt snowball method — a strategy where individuals pay the minimum amount on all their debts except for the smallest one, which is paid off more aggressively. When the smallest debt has been cleared, the next-smallest takes priority, and so on.
Clearing debts in ascending order is a psychological trick that gives people confidence and focus, explained Alessi. “We can start to see our way out, and it allows us to feel empowered in handling our finances.”
Cut Back on Discretionary Spending
When it comes to saving money, Ramsey advocates cutting back on non-essential spending by distinguishing between a need and a want. As a Ramsey Solutions article on his website explained, needs are essentials, like food and shelter, while wants consist of non-essentials you desire but can live without — like home upgrades and entertainment.
According to Reuters, inflation increased in January at its highest pace in eighteen months. And, as tariffs loom, Americans are starting to worry. With inflation increasing to 3%, cutting back on non-essentials like manicures and Hulu Premium services may be a smart way to save money and plan for higher prices.
Create an Emergency Fund
Rachel Cruze explained in an article for Ramsey Solutions that everyone needs three to six months’ of expenses set aside for three main reasons: It prepares you for the unexpected, like medical emergencies and job losses, creates peace of mind and protects you from borrowing and taking on debt — the last one foundational to Ramsey’s teachings.
With A.I. increasingly replacing human labor, job losses are looking more likely across certain sectors. Additionally, unexpected medical emergencies could severely disrupt individuals’ financial well-being if proposed cuts to Medicaid or the Affordable Care Act are enacted by the new Trump administration. Ultimately, though, no one knows definitively what will come to pass.
“A lot of the worry or stress that is caused by finances is due to being unsure of how to handle what is ahead,” said Alessi. With current economic uncertainty, an emergency fund allows you “to focus on your own financial well-being” by preparing for the worst.
Buy Essential Insurance Policies
The purpose of an insurance policy is to transfer financial risk from yourself to an insurance company in the event that something bad happens, so you don’t get wiped out financially. According to Ramsey Solutions, there are eight essential types of insurance coverage everyone needs: auto, health, life, renters/homeowners, long-term disability, long-term care, identity theft protection and an umbrella policy.
With widespread devastation in Asheville, North Carolina, and Los Angeles after Hurricane Helene and the unprecedented wildfires, many uninsured individuals were left with nothing — and environmentalists project climate disasters will only worsen in the coming years. Additionally, identity theft and banking fraud are becoming more common as scammers employ sophisticated strategies with the use of AI.
If you haven’t yet gotten proactive in protecting your property, your identity or your health, it’s time to start.
Invest 15% of Your Income in Retirement
Ramsey suggests investing 15% of your gross income every month in retirement accounts, like a 401(k) or an IRA. He argues that this percentage is feasible for most people and will better help them plan for the future. Unfortunately, most people remain unprepared for retirement and, as a result, could be missing out on some real gains.
“Retirement is especially important in 2025, because predictions for investments are favorable,” Musson said. “Investing for retirement is important regardless of the financial landscape; but if you can take advantage of the growth right after investing, your contributions will have the chance to grow through interest and make a big difference in your assets and ability to fund your retirement.”
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