Debt Management for Financial Independence

November 28th, 2007 | Stacey | Debt Management, Financial Freedom, Financial Independence

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Proper debt management is essential to attain financial independence. Our latest series of blogs explore the myths about financial independence that stand in the way of achieving your goals. A major myth about financial freedom is that can responsibly use credit to improve your financial situation.

While credit may come in handy if you have a medical emergency or hardship and need to refinance your house, in most situations credit is your enemy. Despite the tales you hear about using credit to improve your finances, the harsh reality is that in few situations does this actually happen. The ones who benefit most from you taking out credit are the lenders and the merchants.

When you purchase items on credit, you are actually paying more for the items because you are paying high rate of interest. Over the years, this can add up to spending significantly more on the same items, which inhibits your potential for financial independence.

It involves effort and discipline to avoid credit but the financial freedom you feel as a result of not having debts hanging over your head and accruing interest is immense. After some time goes by, it will feel so relaxing not to have to spend so much time and money to maintain a financed lifestyle. When your bills are paid, you have more time for your loved ones and to do the things you really enjoy. Being debt free and having more time to yourself equals the financial independence you have been seeking.