In Dave Ramsey’s Financial Peace University©, he outlines seven very basic, yet sometimes complex, baby steps towards gaining financial freedom.

As a financial coach, I recommend following these proven steps and strategies. But sometimes getting started is hard.  As Dave says in the first video, the first step,  $1000 in the bank, is the easiest and yet one of the hardest steps. Easy because it is only $1000. Hard because it’s $1000.

It’s also hard because it is the first step. The first step that requires commitment. First step to prove you are serious. It is the first step in giving yourself hope and the first step on the road to freedom. A new road that what you have been traveling. The first step changes your behavior, for life.

I liken it to resolving to live a healthy lifestyle. You’re not going on a temporary diet, but changing your lifestyle. A commitment to changing your behavior is imperative. And just like going to your first exercise class, or saying ‘no’ for the first time to a  donut indulgence, the first step is challenging.

It is a bit easier if you know WHY you are doing this. Why $1000? To create a safety net for yourself. To create a ‘no excuse’ zone. To show yourself that you can do this.

There is a psychological benefit too. If you have sacrificed and worked hard to save the money, you are going to think twice before spending it – it creates a belief system within you and a willingness to deny yourself.

With the benefits in mind, here are five action steps to get your first $1000:

1. Make a Plan. Progress is made with a written plan. Your plan should include how often you will make a deposit and where your savings account will be. The plan should also include mini-steps of where to cut back in your spending. Take care of your four walls – housing, transportation, food, and clothing; scrutinize anything over and above.
2.  Practice Delayed Gratification. Most of us can go one month (or a little longer) making do.  If you are wanting a new item of clothing or a new book – practice waiting. Delayed gratification is also called ‘denying yourself’ – it is a good discipline!
3. Fast. From eating out, entertainment, cable, movies, snacks, coffee. Eliminating one trip to the coffee shop every week can release $20 in one month. Or vow to take your lunch three days every week-that could add up to $120.  Incremental changes add up making a big difference.
4. Shop your pantry. Most of us have an abundance of food just waiting to be used. You may be able to cut your food budget by a significant amount and direct those savings to your $1000. If you need help, or unsure how to use those six-month-old cans of water chestnuts or crushed pineapple, check out Supercook where you can search recipes by available ingredients. You might find something new to add to your repertoire of meals.
5. Automate. Set up an automatic savings withdrawal. If you never see it, you can’t and won’t spend it.  As you adjust your monthly spending plan, increase the amount of withdrawal. It will amaze you how this little adjustment will make a big difference.

$1000 in the bank. Your first step to loving your family well financially for now and in the future.

For the love of family,

Kristin