Investing vs. No Debt – Which One is Better?


In today’s world, everyone wants instant gratification and a sure thing. However, when dealing with money, neither is usually easy. When trying to navigate financial waters, one many times has to wonder which is better — good investments or living debt free? Personally, I choose to be debt free. I base my decision on many factors. Read on for more insight on my financial wisdom 🙂

Less Debt = Less Stress
Many people live paycheck to paycheck. They have NO room for change in their financial decisions or work choices at all, due to the fact that there is a certain amount of money that must go out each month to cover their debt. They could never quit or change jobs or do another line of work that might be riskier or bring in less money, as their debt dictates their life. If you’re lucky enough that this isn’t you, remember this as you make big decisions regarding your finances.

Do what you can to avoid this fate. Begin to pay off debt and live without the added burden of paying off bills, and see how free your life feels. You will be able to make decisions based on what brings you peace and happiness, instead of what brings you the ability to open the mailbox and not sweat. If you get out of debt, eventually you can strive to save money for investments. However, if you drop dead tomorrow from worry and stress, those investments won’t mean much.

Unknown Timeclock
Every human on the planet gets a limited amount of time to make something of their life. The only catch is we don’t know how much time we have. So we strive to plan out a way to live our last days conveniently and comfortably, but what if those last days are light years before what we thought they would be?

How would you feel if you planned, scrimped, sacrificed and did without, only to invest money in something that we might never see come to fruition, like retirement? Living debt-free guarantees one a more worry-free, financially stable lifestyle, which is what saving for retirement and investing in a good portfolio is suppose to give us. Why not have it every day instead of during our “golden” years that no one is promised anyway? Debt free is worry-free, today and tomorrow. If tomorrow doesn’t come, then the stress-free feeling you had today was well worth it!


Loved Ones
By the same token as above, you might leave the planet earlier than anticipated. While some good investments might make the loved ones we leave behind well off, if the same loved ones inherit a mound of debt to go along with it, then investments, death taxes, etc will eat up any profits the investments may have resulted in.

If the beneficiaries of your will have houses to pay off, funerals to pay for, taxes to pay, and so forth, your good intentions may be eaten away and you won’t even know it or be here to help.

If you live debt-free, then by the time you are no longer here, the house you have paid for, the cars that are paid for, the charge card bills and creditors that don’t have to be paid off will aid in leaving your loved ones with no stress to deal with. If you have life insurance, they will have money in the bank to boot! Investments are a great idea, but a debt-free inheritance is even better.
Our society gears us up to thinking that if we don’t have a diversified portfolio, the world will somehow come crashing down on us in our old age. Don’t buy into that.

Do all you can to pay your bills, establish a great credit score, and get out of as much debt as you can. See how peacefully you sleep at night knowing that no bill collectors will knock on your door, now or later. Debt-free has the word “free” in it for a reason, as that is how you will live knowing you have no debt!

Saul Graham writes about finance, investment and education. His best work discusses the top business degrees in the US.

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Category: Debt Freedom