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The Official Savings Advice Debt Free Thread

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    The Official Savings Advice Debt Free Thread

    I did a title search on "debt free" and was surprised there wasn't an Official thread for people to proclaim & rejoice that they are debt free. There were 77 threads with those terms in the title, many of which were in fact people making such an announcement. So I thought it would be cool to have such a thread.

    If you are already debt free, what year did you achieve it?

    I can't officially make such a statement, but I was mulling over making it so earlier today. I owe approximately $3,100 on my car with 6 payments remaining at 1.9%. I have the means to pay it off and it is to the point where I am tired of logging the payment each month. Need to talk it over with the boss to make sure she is on board. If so, I will come back and do a happy dance.

    #2
    I get the sense from the frequent contributors on here that their #1 goal is not to be 100% debt free until closer to retirement. It might be goal #3, behind retirement and EF/Savings.

    Like you, I'm only carrying a 1.9% car loan (11k balance) at this point and could be debt free today as well.

    Comment


      #3
      Originally posted by Jluke View Post
      I get the sense from the frequent contributors on here that their #1 goal is not to be 100% debt free until closer to retirement.
      Pretty much. We have a portfolio that stands at a little north of 800K at the moment. We have debt of about 50K right now. Obviously, we could pay it off at any moment if we cared to, but it is not a priority due to the very low interest rate on 37K of it (mortgage). The other 13K (student loan) is being paid off aggressively, $1,000/month.
      Steve

      * Despite the high cost of living, it remains very popular.
      * Why should I pay for my daughter's education when she already knows everything?
      * There are no shortcuts to anywhere worth going.

      Comment


        #4
        Originally posted by Jluke View Post
        I get the sense from the frequent contributors on here that their #1 goal is not to be 100% debt free until closer to retirement. It might be goal #3, behind retirement and EF/Savings.

        Like you, I'm only carrying a 1.9% car loan (11k balance) at this point and could be debt free today as well.
        There was definitely a time where my goals ranked the same way. Unfortunately, my DW and I both work for companies that have made a lot of cuts the last few years with plans to reduce staff even further. That is why becoming debt free became our #1 goal.

        Comment


          #5
          It's official

          DEBT FREE AS OF 10/28/16

          Thank you Carlton for helping me celebrate this moment

          Comment


            #6
            Became debt free when we finished paying off the mortgage. I was around 40 or 41.
            Last edited by scfr; 10-28-2016, 05:24 AM.

            Comment


              #7
              Originally posted by DaveInPgh View Post
              DEBT FREE AS OF 10/28/16
              Congratulations!

              Comment


                #8
                Originally posted by DaveInPgh View Post
                my DW and I both work for companies that have made a lot of cuts the last few years with plans to reduce staff even further. That is why becoming debt free became our #1 goal.
                Originally posted by DaveInPgh View Post
                DEBT FREE AS OF 10/28/16
                Congrats on getting debt-free!

                As for doing so because the job may be shaky, if I were in that situation, I'd be hoarding cash and bulking up the savings as much as possible. I'd much rather have a pile of cash and some debt than no debt but no cash either.
                Steve

                * Despite the high cost of living, it remains very popular.
                * Why should I pay for my daughter's education when she already knows everything?
                * There are no shortcuts to anywhere worth going.

                Comment


                  #9
                  Originally posted by disneysteve View Post
                  Congrats on getting debt-free!

                  As for doing so because the job may be shaky, if I were in that situation, I'd be hoarding cash and bulking up the savings as much as possible. I'd much rather have a pile of cash and some debt than no debt but no cash either.
                  Thanks

                  We have $16k in savings/emergency fund, $2,800/month after expenses and $81k in Roth contributions we can pull from if we both were to lose our jobs at the same time.

                  Comment


                    #10
                    Congratulations!
                    LivingAlmostLarge Blog

                    Comment


                      #11
                      Originally posted by disneysteve View Post
                      Congrats on getting debt-free!

                      As for doing so because the job may be shaky, if I were in that situation, I'd be hoarding cash and bulking up the savings as much as possible. I'd much rather have a pile of cash and some debt than no debt but no cash either.
                      That rubs the Dave Ramsey fans the wrong way for sure. However, it is simply more realistic if you have the means to do it. That's the one major draw back of aggressively trying to be 100% debt free. You might be in a better net worth position, but you are not necessarily a more secure position.

                      I see the same thing with people who tie up their money in their house. You might be worth 1 Million net value, but you can't buy bread with bricks.
                      Everything happens for a reason. Sometimes that reason is you're stupid and make bad choices.

                      Comment


                        #12
                        Originally posted by GoodSteward View Post
                        hat's the one major draw back of aggressively trying to be 100% debt free. You might be in a better net worth position, but you are not necessarily a more secure position.
                        Your net worth is exactly the same either way.

                        If I have $5,000 in the bank and $5,000 in debt, my net worth is zero.
                        If I have nothing in the bank and no debt, my net worth is zero.

                        I'm much rather be in the first position if I lose my job.
                        Steve

                        * Despite the high cost of living, it remains very popular.
                        * Why should I pay for my daughter's education when she already knows everything?
                        * There are no shortcuts to anywhere worth going.

                        Comment


                          #13
                          Originally posted by disneysteve View Post
                          Your net worth is exactly the same either way.

                          If I have $5,000 in the bank and $5,000 in debt, my net worth is zero.
                          If I have nothing in the bank and no debt, my net worth is zero.

                          I'm much rather be in the first position if I lose my job.
                          That's true, it does even out. I should've had a V8 before posting that one. haha

                          I agree with you. I'd rather have debt and cash than no debt and no cash. I still stand by my comment above that it's the penalty you pay for aggressively paying down debt before anything else(Dave Ramsey mentality). With his method, it doesn't matter if you have 1,000 credit card debt or 100,000 credit card debt, 1000$ cash on hand is all you get until it is paid off, plus cars.
                          Everything happens for a reason. Sometimes that reason is you're stupid and make bad choices.

                          Comment


                            #14
                            Originally posted by GoodSteward View Post
                            (Dave Ramsey mentality). With his method, it doesn't matter if you have 1,000 credit card debt or 100,000 credit card debt, 1000$ cash on hand is all you get until it is paid off, plus cars.
                            I haven't listened to DR for a while but haven't I heard him tell people to "push pause" on the debt snowball when there was something serious going on? Like when there was a baby on the way or a job loss?
                            Steve

                            * Despite the high cost of living, it remains very popular.
                            * Why should I pay for my daughter's education when she already knows everything?
                            * There are no shortcuts to anywhere worth going.

                            Comment


                              #15
                              Originally posted by disneysteve View Post
                              I haven't listened to DR for a while but haven't I heard him tell people to "push pause" on the debt snowball when there was something serious going on? Like when there was a baby on the way or a job loss?
                              Yes, I've heard him advise that before. It seems to be only rare cases and not a general rule of thumb for extreme situations. In my mind, owing 100k in various debts is a serious situation similar to knowing a child is coming, and if possible you need to get proper savings in place first because it will take a while to get that out of the way. I've heard of people paying that much off over 3 years, 4 years, or even longer. That's great progress, but it is also a long time to only have 1k$ in savings and hope to never touch a card. I personally don't think it's wise(or really what happens in most cases), and this adds to my thoughts on EF's being tailored to each person instead of a once size fits all. I bet if you got down to it, very few people who go on his show and do a debt free scream either kept only 1k in savings or never touched a card during that repayment time.
                              Everything happens for a reason. Sometimes that reason is you're stupid and make bad choices.

                              Comment

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