Why live debt free….

We live our lives full of stuff, most of it not “needed” but somewhere we heard we deserved it. If we had it, we’d impress our friends; if we didn’t have it, we’d be depriving ourselves or worse our kids – oh no, then we’d be bad parents. Our friends would say – “What? Little Samantha doesn’t have an iPhone 6?” You think to yourself, well she is 10, and I do need to be able to track where she is (there’s an APP for that)… I guess it would be wise if she had one…. and you justify, though you kinda can’t afford it. OK, maybe you can afford it, but that’s $XX a month that could have gone to retirement, or saving for your next car. Maybe the money could have gone to your local animal shelter or to your church… OK wait, I’m getting off track – let me get back to the title of this post…

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WHY LIVE DEBT FREE? Click here for 4 reasons from Wallet Hub.  I consider the following statement by Bill Pratt, in the article “Learn to Live Completely Debt Free by Age Thirty”,  the main reason to get out of debt and stay that way for life:

‘Having debt simply eliminates many of your choices, or at least makes them more difficult to pursue. By paying off your debt early in life, you can open up so many new choices for yourself. In fact, one of the greatest things about not having any debt is that you can use all of that money to save towards a future goal, even if you do not yet have a goal.’

But you may be asking, “Can or does anyone really live  a debt-free life?” The simple answer is yes – let me add a touch of emphasis here YES!! It truly is a choice that we make. Can you pay cash for a car? Yes – if you’re willing to wait, but you need to start saving BEFORE the one you have is costing you more than its’ worth in repairs each month. Can you take a vacation and pay cash without worrying about getting robbed? Yes, again… plan the trip, determine the cost and save up for it. Pay as much of the trip in cash, up front (use a debit card) then transfer the money you’ll be taking to travelers checks – if they get stolen, they get replaced. The one purchase that everyone seems to have the biggest challenge with is buying a home. Can’t tell you the number of people who’ve said to me – “how can you save $150,000 (or more) to pay cash for a home?” But there are those who have – living on less much less than they make and saving. Now does this mean that you have to live “live like a hermit” with no toys or fun… absolutely not, but rather than plastic use real money. AND you may get a funny look from the clerk who might not know what to do with it, but trust me its’ a choice you’ll feel better about making the more you do! At the core of all this is learning to live on a budget. The one thing EVERYONE involved in Personal Finance seems to agree on, if you can’t create a budget and learn to live on it, you will not succeed with money.

The question I see debated: Is debt bad, good, or does it matter? Do you live debt free, but use credit cards? Are you ok with short-term debt – IE “I pay off my credit card every month.”

Let me know what you think.

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