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What approach does Dave Ramsey recommend for saving for purchases?

User Atul Kamble
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Answer: Sinking fund approach

Explanation: "A sinking fund is where you save a little bit of money every single month for something specific. So, anytime you have a known expense coming up, you can use a sinking fund to save up for it over time".

As Ramsey explains, a sinking fund is different from an emergency fund, because the purpose of it is to prepare for expected expenses that you are going to incur soon. And he believes it us important to have one because it makes big purchases easier to pay for without having to borrow

User Tushar Garg
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