Core Insights - Dave Ramsey's 7 Baby Steps provide a structured approach to financial management, focusing on debt elimination and wealth building, though some view them as outdated [1][2] Group 1: Emergency Fund - Step 1 emphasizes having a $1,000 starter emergency fund, which is beneficial as 37% of American adults lacked enough cash for a $400 unexpected expense in 2024, making this a crucial initial safety net [3] - Step 3 involves fully filling the emergency fund to cover three to six months of expenses, which helps avoid future debt and provides a financial cushion during unexpected situations [6] Group 2: Debt Management - Step 2 focuses on eliminating consumer debt, which includes credit cards, auto loans, and student loans, excluding mortgage debt for the time being [4] - The debt snowball method is recommended for tackling debt, prioritizing smaller debts to build momentum, despite ignoring interest rates [5] Group 3: Retirement Savings - Step 4 advises saving 15% of pre-tax income for retirement, which is higher than the average 9.5% contribution reported by American employees to 401(k) accounts in Q2 2025 [7]