When you’re out of debt, your money stays yours. You no longer have to send it off to the lenders, or watch it exit your bank account immediately. Instead, you can send it out to grow more money for you — in the form of saving and investing.
It’s also a lot easier to buy the exact same kinds of things you bought while you were in debt. (If you still want to.) That’s because things cost less without all the extra fees and interest.
Let’s compare…
Do you know how long it took me to buy a $12,000 car when I had consumer debt and made $24,000 a year? 48 months — using a car loan from the credit union.
Do you know how long it would take me now, if I still made $24,000 a year?
20 months, to pay for it in cash out of money set aside each month. And that would be with me spending a couple hundred bucks a month eating out, which I darn well never did when I made $24,000 a year.
The difference
That’s because my money stays mine. It sits on my checking account until I decide to send it somewhere else. And it’s because we’re debt free.
What will you do when you’re out of debt?
I'm Jackie Beck, personal finance writer and creator of 
Good post. I remember being in credit card debt and it was horrible. Now that all we have is our mortgage, it’s so freeing to know that our money is ours and not borrowed or owed to something else in order to fund a crazy lifestyle.
It’s a nice feeling!
Hi Jackie! I met you at NMX not too long ago…we sat next to each other in Dino Dogan’s session.
I wanted you to know that our brief conversation sparked the need for me to start on a path of being debt-free. That same night, I went home and paid off all of our consumer debt (which if you recall, was a hefty amount).
We had the savings to do it all along, but had the crazy idea that we’d rather have our savings balance stay constant rather than use it to pay off debt. It hurts to see the balance has dwindled, but at least with each paycheck, we’ll be paying ourselves back and not the credit card company. :)
It was very nice to meet you. Best to you in the coming year!
How funny, I think I’d just emailed you before you posted this comment. At any rate, that is so, so, SO awesome KC! Think how much more you’ll be able to save now that you’re not paying interest :)
Now that we’re almost out of debt (save our mortgage), we set aside the money to buy things before we take hte plunge. It’s so much more fun writing a check or paying in cash than having to go to the financing office!
Isn’t it though? And there’s no guilt or stress afterward, either.
Great advice on this Jackie. Its the classic reason why the rich get richer and poor get poorer really. Thats the sad truth, but this is why blogs like yours are putting some good back into the internet in helping and advising people how to get out of debt! Keep up the good work.
Glad you liked the post :)