Personal financial expert Dave Ramsey says If you are going through tough times financiallyyou need to budget for the “four walls” first and foremost.
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In a series of tweets, Ramsey suggested budgeting for food, utilities, housing and transportation in that particular order. “I call these budget categories the ‘four walls. Focus on getting these things done first and in this particular order…especially if you’re going through a tough financial season,” the tweet wrote.
Ramsey advised prioritizing spending, especially when facing financial hardships.
“Cover your utility bills before you pay your rent or mortgage, because in most cases you risk having your lights and water turned off before you’re evicted or foreclosed,” Ramsey continued. “Never pay off your debt before buying food. Pause additional debt payments and save money to weather the financial storm.”
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In a blog post, Ramsey detailed the four walls and how to protect them from inflation.
As Ramsey Solutions details, it’s best to shop at cheaper stores like Aldi, Costco, and Walmart to find better food deals. Buy only what you need and use cashback apps and coupons whenever possible.
Utility costs are also soaring. According to the Energy Information Administration (EIA), normal electricity bills this summer are expected to rise 2% for him compared to a year ago. You can reduce your utility bills by programming your thermostat to run your appliances only when you need them and use less heating and cooling energy when you’re at home.
To save on housing costs, Ramsey Solutions suggested hiring roommates and setting aside enough money for a down payment to avoid private mortgage insurance (PMI). Also important: Don’t let your housing payments exceed 25% of your monthly take-home pay.
Transportation is last on the list, but you can save money on gas by joining gas rewards and cashback programs, or by using the app to track the lowest gas prices. Avoid buying a car now unless you need it ASAP, or budget for a used car.
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This article was originally published on GOBankingRates.com: Dave Ramsey says budget for these ‘four walls’ before anything else, and budget in this particular order
