Personal Finance

Why Becoming Debt-Free Isn’t One of My Goals

A woman sitting at a table with a laptop and papers in front of her.

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Should you aim to become debt-free? 


Key points

  • I have set many goals for my financial life, including saving enough for retirement.
  • Becoming debt-free isn’t one of my goals.
  • I believe debt is a tool and there’s no reason not to borrow when appropriate.

When it comes to my finances, I have tried to be responsible and set many goals that will help me build wealth. But, becoming debt-free isn’t one of my goals even though many people set an objective to repay all that they owe. 

Here’s why I’m not prioritizing getting out of debt, or making any particular effort to either pay off my current loans or avoid borrowing in the future. 

There’s a simple reason why becoming debt-free isn’t a priority

I currently owe money on several different mortgage loans, and my husband has an old business loan that he has been slowly paying off for many years. 

Paying off these debts early is not a priority for our family and, in fact, we have been making only minimum payments on them even though we could afford to pay them off sooner by sending in extra money every month. 

I’m not worrying about becoming free of these debts because they are low interest loans that were designed to help us take steps that improve our overall financial picture. They are meant to be paid off over a long time and the interest on them is tax deductible for us. And I can generally get a better return on my money by investing it in the stock market rather than by paying off my debts early and saving on the interest I would otherwise owe. 

If I had very expensive debt that I had taken out for assets that lose value, such as credit card debt used to pay for vacations or for everyday purchases, then I would be eager to pay back these types of loans. But I tend to steer clear of this kind of borrowing, instead making sure I only charge things on my cards that I can pay for in one billing cycle before interest is due.

Since I only take out debt that I consider “good debt,” though, this isn’t an issue for me. I am not afraid of debt because I know borrowing can be a tool that helps you grow your net worth over time, as long as you’re smart about the kinds of obligations you take on. When you get affordable loans for the right reasons, debt can actually be a good thing and paying it off may not be the best use of limited funds. 

I’d also be willing to borrow again in the future 

Not only am I not worried about becoming free of the debts that I currently have, but I would definitely be willing to borrow more in the future. In fact, if I ever bought another house, I would be happy to take out a mortgage loan and if I got a good idea for another business for our family to start, I would be happy to borrow to get the company off the ground if I needed to. 

Borrowing money shouldn’t necessarily be treated as something to avoid at all costs, and becoming debt-free is the wrong goal for me and many others. Instead of focusing on getting rid of all debt, you can end up better off if you steer clear of bad debt while using financing to help accomplish important goals that build your wealth over the long term. 

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