By Anna D. Banks
On Sunday, May 4, 2008, the first class of Financial Peace University (FPU) at Harambee Center began. The response was great! In fact, it was standing room only in the room reserved for the class. It was a small group but I think it will be a great class. The Super Savers lesson was absolutely hilarious. I think everyone in the class was pleasantly surprised that the video sessions were entertaining as well as informative.
Discussion after the video went very well, according to Small Group leaders (SGLs), Sharon & Billy Brown; Andrea & Carl Davis; and Louise Reeves. In addition to our Elmwood church family, we had families from Staten Island, Woodbridge, and Parsippany drive to the East Orange to be apart of this class. These families, who are faithful listeners of the Dave Ramsey Show, found out about FPU at Harambee from the Dave Ramsey website www.DaveRamsey.com.
Here’s a brief summary of the lesson:
Super Savers (week 1)
Dave Ramsey provides an overview of the program. He covers the value his “Baby Step #1,” a short-term emergency fund which he defines as “$1,000 in the bank.” Do not touch the emergency fund, except for in emergencies. Savings is about emotion and you’ll only save if you make it a priority. Social Security will not provide enough for a secure retirement. Money is amoral - it’s not good or bad but can be used for good or bad purposes. Don’t spend more than you earn.
You must learn to save for three things: emergency fund, purchases, wealth building (retirement, college, etc.). By saving for purchases and paying in cash you can negotiate better deals. Start saving NOW - the sooner you start the more of an impact compound interest can have. He goes through some examples of how compound interest works. He emphasizes the importance of obtaining a high interest rate of return on your savings. Make your long-term savings automatic. Cut up your credit cards and never use them again. Budget ahead for things like clothes, Christmas (and other important holidays) vacations, and all the expenses that you know are coming.
The main “take away” from our first class was that we need to remember, as small as our baby steps may be they are still steps forward. As long as we keep going in this direction we will complete the journey.
Next Week: Lesson 2 - Relating with Money
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