bluntmoney.com

J.D. over at Get Rich Slowly recently asked his readers How is living debt-free different than becoming debt-free?

While I don’t consider myself debt-free (because we still have the mortgage) I thought I’d write about this since it’s been on my mind lately.

I think that for me, the biggest change will be that I won’t feel like I have to go to work on a regular basis. Realistically I probably will anyway, especially since I enjoy my job, but there’s a big difference between feeling like you must do something or face unappealing consequences, and feeling like you have a lot of very pleasant options.

Paying off our mortgage will free up nearly $750 per month for each of us, which means that my monthly expenses will drop to about $440 per month. Of course, I will probably spend more than that, since that $440 just includes food, shelter (taxes & insurance), transportation, phones, pet food, internet & Netflix. Realistically I’d want to add money for health insurance if I did not have a regular job, which would bump it up quite a bit. And of course I’d want to eat out, and continue traveling. But the idea of being able to live on so little if I choose to or need to is appealing.

Life without debt equals increased possibilities, more money and less stress.

I’m already feeling the difference, because I do not have any revolving credit card debt, car loans, student loans, home equity loans, or any other type of non-1st-mortgage loan. Every month, I have money that I can keep and use for investments to bring in more money in the future. Of course I can also use some of it for guilt-free fun.

JD wondered, “How do you keep from reverting to old habits? How do you keep from spending too much?”. For me it’s come down to one simple rule: If I don’t have the money, I don’t buy it. That’s it. I just keep right on applying that rule. I don’t analyze wants vs. needs. I don’t rationalize. I don’t think “well, but…”. I just follow the rule. One rule makes it simple. My only exception would be a medical emergency, which of course I hope never comes to pass.

• Sunday Money Madness: Money and Frugalness Hello and welcome to the Money and Frugalness edition of the Sunday Money Madness Roundup. Several categories are presented below to help break up the...
• Personal Finance Equations You Should Know: the Amortization Equation Amortization is probably one of the most ubiquitous financial concepts that encompasses our daily lives, but yet, few of us know what it means, how...
• debt free I can't remember how many times I've seen the comment "I'm debt free except for the mortgage/student loan/last car note/etc.". It's like saying you're drug...