If it were me, I’d just save every penny I could and drop it in a savings account. You can worry about investing and growing your money later, after you’ve settled into your new life and have some stability. Just think how cool it would be to graduate with $20,000 in the bank. Then, when you change gears and move out into the real world, you can do some really cool things with the money that’s left. Set three to six months of expenses aside as your emergency fund, then you can even begin to think about buying a home and investing in Roth IRAs and other pre-tax retirement plans.
But your biggest investment right now is making sure you finish school and have the cash on-hand to transition smoothly afterward. And you’re in a great position to make that happen!
If it were me, I’d begin aggressively paying down the car now. Then, when the doctor confirms she’s pregnant, you can temporarily push the pause button on your Total Money Makeover. If you haven’t managed to pay off the car at that point, use the money you were putting toward it to build up a big cash pile of savings, and go back to regular payments on the car after the baby comes.
By doing this you really lose no ground on your get-out-of-debt plan. You’re just redirecting your resources in case you need additional money down the road. But who knows? It may take you guys a while to get pregnant. And if that happens, you could have the car paid off and plenty of opportunity to save up more before the little one arrives!
* Dave Ramsey is America’s trusted voice on money and business. He’s authored four New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover andEntreLeadership. The Dave Ramsey Show is heard by more than 5 million listeners each week on more than 500 radio stations. Follow Dave on Twitter at @DaveRamsey and on the web at daveramsey.com.
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