Is it really better to live debt free?
There is a lot of talk nowadays about frugality and paying off debt, but why is living with debt so bad? What harm is there in using a credit card to get what we want? After all, we work hard. Don’t we deserve some luxuries? Why wait to get things when interest rates are so low?
Well, I lived with debt for several years and now I’ve been debt-free except for a few small bills for a little over a year. So, I know the differences firsthand and I can say that living with debt BITES!
The top ten reasons living with debt should not be an option!
Personally, I’ve ruled out using debt as an option. I’ll pay cash or do without! Why do I feel so strongly about this? Well, here are my top ten reasons.
10. You might lose everything
When you borrow money as a way of life, you run the risk of losing it all. As we’ve recently seen, people sometimes lose their jobs unexpectedly and they don’t always find another one for months. Falling behind on your payments often leads to foreclosures, repossessions and lawsuits. It can even snowball into bankruptcy. Why take the chance? Why not just be happy with what you can afford?
9. The worry will keep you up at night
People that are living beyond their means often suffer from sleepless nights worrying about how they are going to pay for all they’ve bought. Is it worth it?!? What in the world is worth dealing with insomnia, ulcers and overwhelming stress? Getting behind will result in your debts being turned over to collectors which means things will only get worse. People often become consumed with worry about how they’ll make ends meet. Not me! I sleep like a baby. Being debt-free is a lot less worrisome.
8. Debt leads to a lower standard of living
Being in debt robs you of your quality of life. It is draining managing all the debt and working yourself to death trying to pay for it all. Yes, you may appear on the outside to be living the good life, but not on the inside where it really counts. How can you even enjoy what you have when you are juggling all those bills? The freedom I feel from being almost completely debt-free is to me a much better way to live!
7. It is a continual drain on your finances
Debt robs you of your financial strength. It leaves you a monetary weakling. Why? For a number of reasons. You pay way more for everything you buy because on top of the purchase price, you are also paying interest, late fees and service charges. It is like having a leak in your checking account that you can’t get fixed. Dribble, dribble, dribble! That’s the sound of your money going down the drain. I’ve fixed my leaky pipes and it is nice to have my money working for me again!
6. Debt steals your sense of security and peace of mind
I don’t know exactly what it is about being in debt that is so unsettling, but it is. I think this is especially true for women. Many just don’t seem to feel as safe when debt is on the books. Maybe it is because those living beyond their means don’t have any leverage financially. They’re broke and broke people can’t buy their way out of a wet paper bag! Having money in the bank makes everyone in the family feel a little more secure at night and I like that!
5. Causes one to compromise their moral beliefs
People juggling debt often find themselves in tight places where they wind up compromising their values. They have to lie to a lender to buy a few days. They are tempted to do things that are unethical or just dumb to get the money they need to pay the bills. Of course, for many, this erodes their self-confidence and makes them feel like crap. Why put yourself in this position?
4. Robs your children’s future
When you are living in debt, you typically aren’t saving for college or accumulating any wealth to pass on to your kids. In addition, you are teaching them very poor money habits. Is this what you really want? Every time we make another purchase on a credit card, it is like stealing from your child’s future! That is way too high of a price for me to pay.
3. Holds you back from a life of meaning
When you are buried in debt, you can’t help others. Most significance in life comes from being generous. Generosity flows from abundance. Living with debt produces a sense of scarcity. It makes us want to hold on to everything we have with an iron fist. Paying off debt has helped my family create margin in our finances and gives us the freedom to live a life of meaning!
2. Prevents your money from working for you
When you borrow, your money is earning interest for others. It is working for them. In fact, you are no longer working for yourself at all. You are working for those you owe because the majority of what you earn goes directly to them. Imagine someone out there is prospering from all your hard work. I don’t like that vision! I want me and my family to be the ones that benefit from my earnings.
1. Makes you a modern day slave
Freedom is about having options. It is about choosing where to live and work and play. When you have debt, your options are very limited. You can’t change jobs because you need the pay even though the work is crappy. You can’t buy a better house in a better area with better schools because you don’t have the money. You can’t do the things you’d really like to do because if you did you might not be able to make ends meet. See the rub? This is the number one reason that I like being debt-FREE!
My top ten reasons to avoid living with debt
It truly has been a relief to pay off a bunch of our debt! I’d choose being debt-free any day. My wife and I have struggled with all of the above at one point or another in our lives and we’ve witnessed it in the lives of our neighbors and friends. Living in debt is just not worth it! If you are convinced and want to get out of debt, you will find several articles on this site that will help.
Craig is the founder of LifeGuider, he is dedicated to improving not only himself but also others in being more physically fit and mentally capable of handling life’s challenges. He is not your regular life coach, no fancy clothes or fast cars, just a regular “Ole Joe” who has experienced the ups and downs of life like everyone else.