Finally Debt-Free
I just made the final payment on my house and am officially almost debt-free. I do still have a small zero-interest car loan, but that’s all I owe. The house is paid off and so are the credit cards. When I got paid yesterday, I only had to pay taxes, insurance and utilities. I am finally able to invest 50% of my net income and still live a prosperous life.
Debt Considerations
Mathematically, it doesn’t make much sense to pay off a 3% loan in a time of roughly 6% inflation. In fact, one of my investment newsletters recommends taking the biggest mortgage you can possibly get for 3% and invest that money. That sounds like an awesome plan to me, unless the stock market crashes or you lose your job. I would rather sleep well at night than take on a lot of risk and leverage to make a couple extra percentage points.
Psychologically, paying off my house makes all the sense in the world to me. I’m not so much against debt as I am for financial freedom and I’m now free from debt. I’ve had a goal for 25 years of paying off my house early and I’m finally there. I have dreamed of retiring without debt or a mortgage and I’m there 10 years early. The sense of pride and accomplishment I feel when I sit in the house I own can’t be described in a spreadsheet. It is a splendid feeling indeed. I hope you can all experience it one day.
The Bottom Line
Finances are definitely personal and everyone has different dreams and aspirations. All of my dreams became goals and now I’m reaching them. Live your dreams, conquer your finances and support others on their journey.
“Debt is normal. Be weird.” – Dave Ramsey
