Debt Free Life: Can You Ever Truly Lead One ?
As we grow through life we tend to take it that some things will always be there. Bills, taxes and employment are generally on that list. But does debt belong in this category? After all, we don’t start with debt attached to our name. So how come it’s become a large part of our daily adult lives? How does debt start and how is it able to persist? The answers to those questions are actually quite simple. The real question comes in the form of whether one can ever be completely debt free and lead a debt free life. That question is a bit more complicated and requires a working understanding of how most of the financial matters of the world works. Here we will discuss common debt factors that can occur and whether you can escape all forms of debt at some point in life (and how).
First of all, it is important to know how debt can pop up in your life. From credit cards to mortgages, debt seems to always find its way into our existence. But where does it begin? For many young adults, debt starts in the form of student loans for college. Many college hopefuls have and will attend college without the means to pay off their tuition without the help of grants, loans, and scholarships. While grants and scholarships are the equivalent of free money, loans are not. You will be on the hook for student loans once you leave your university (regardless of whether you graduate or not).
Student loans might not be a huge deal if they didn’t take so long to get rid of. Also, they might not be so cumbersome if they weren’t insanely overpriced. In some instances people have no choice but to constantly pay down the loan each month. Of course, the ideal situation would involve a full on payment to eliminate the debt. However, since the debt from college loans can total into the tens of thousands (sometimes even more) it can be hard to imagine how someone can make that payment without taking a large financial risk or putting yourself in financial hardship.
Even though many people are afflicted with student loans every year, there are a select few that make it out of their universities without having to pay anything off. Maybe your academic standing has been top quality or maybe you’ve been the recipient of a full ride scholarship for whatever reason. Once you get out of college, you’ll be thrust into life as many adults know it. The next thing that could end up being a major source of debt is the process of establishing credit. Once out of college, credit will be necessary to achieve other life goals. That, however, comes with the consequence of creating debt. This can be in the form of taking out personal loans or applying for (and subsequently using) credit cards.
The neverending process of acquiring and retaining debt begs the question: can we ever really lead a debt free life? The answer is a resounding yes! You can be completely rid of debt at any time in your life, so long as you have a plan when managing your finances. Debt, in the traditional sense, is accumulated over time. The most negative outcome of debt is its accumulation coupled with negligence towards paying it off. With this being the norm instead of the exception, most believe that this is the way life is. But with proper budgeting and responsible use of credit, debt doesn’t even have to be a factor. In our next article we will discuss how to tackle debt BEFORE it becomes an issue.