As I’ve graduated college, gotten out on my own, and brought my finances into good order, I’ve increasingly come to understand my contempt for debt. The thought of someone fleecing me of my hard earned money in exchange for a loan is not something that sits well with me. I’ve been lucky here in quite a few regards. I’ve never had a credit card until a few months ago, I’ve never racked up any consumer debt, and I’ve never had any “bad” debts.
Currently, my only debt is my student loan and the car I share with the girlfriend. While the interest rate on both of these is fairly low, I hate watching that money vanish at the end of each month. To remedy this we have both taken on an aggressive debt-removing campaign that should pay off the rest of my loans and the car within 2 years. If and when this goal is met, I’ll have no financial obligations whatsoever except for the day to day expenses such as rent, gas, etc. It’ll certainly be a glorious day.
So in that vein I am vowing not to borrow money for any period longer than a month (our one credit card is used even though I have the cash on hand well in advance, this is to gain some rewards from the card, and the balance is paid off at the end of each month). This includes a new car, a house, anything I need from here out will be fully funded on the spot. I understand that for many this is a controversial decision as owning a home does come with its own advantages. I’ve looked into it, weighed the pros and cons, and decided that taking on debt to get a house is not for me. I wouldn’t really feel like I owned it anyway, knowing that the bank could take it away at a moment’s notice if I was unable to pay.
Here’s to my future independence.
-Xias
on Sep 20th, 2007 at 11:12 pm
Living debt-free is definitely goal #1, followed by the goal to have enough passive income coming in to live without working for a wage. I think it’s a great idea to plan on paying cash for all of your living expenses, and you’re right – a lot of people would argue that you CAN take on debt for a mortgage. I have a mortgage myself, so I may not be one to talk, but I think that a lot of people have had the wool pulled over their eyes by the banking industry into thinking this is OK. Taking on a mortgage when it was 2X your annual salary was one thing, but for a lot of people it’s up to 5, 6 or more times their salaries and that debt will never be paid off.
Good luck – it’s a tough goal, but a good one!
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