By: Robert | October 21, 2021 |

Caucasian man wearing tie holding money bags over his head cheering

Being rich is a dream many feel they will never achieve—but it could be closer than you think. True wealth exists when you earn more money than you spend, so is being debt-free the new rich?

Even if your bank account isn’t at the level of a Gates or a Musk, earning more than you owe means you have power over your finances that others who are struggling with debt do not.

If, after you’ve paid all your regular household bills, you have no debt payments and have excess money in the bank (even if only a little), you are technically richer than your neighbours with more material objects who are riddled with hefty amounts of consumer debt.

Understandably, without a big windfall of money, becoming debt-free is not something that happens overnight. Instead, it takes time and patience, and a solid plan to chip away at your debts.

So often, the wait can be frustrating and lead to setbacks. But if you create a SMART (specific, measurable, achievable, realistic, and timely) budget for paying down your debt, the task is less daunting.

Give yourself a win from the beginning and start by paying off the smallest debt first. Then, as you see the amount you owe steadily decreasing, the satisfaction you’ll feel will give you the confidence to continue paying off everything else and successfully reach debt freedom.

Focus on building the balance in your bank account. Keep more of your income by not paying interest on loans. Purchase assets that will increase in value.

Change your mindset about what it means to be rich. It’s more than how much money you have in your bank account. It’s not having debt hold you back.

What Is It Like To Be Debt Free?

Being debt-free means you are time-wealthy, obligation-poor, and opportunity-rich. It leads to financial freedom, security, and peace of mind.

There is confidence that comes from financial stability. When you don’t need to find other sources of income to ease your burden of debt, you have greater control over your time and how you choose to spend it.

You won’t need to take that double shift to cover loan payments. Instead, you can spend time with your family and do the things that make you truly happy. You can afford to spend time on leisure activities because you don’t need to use that time to earn cash to pay off your debts.

Don’t like your current job? Change it. Being debt-free allows you to take a chance on a career that suits your desires, not just covers your debts. Alleviating the stress from working a job that makes you unhappy can significantly improve your mental health and physical wellbeing.

Most importantly, being debt-free means no longer living paycheck to paycheck. Having more money in your bank account makes day-to-day living more manageable and saving for college, retirement, and the unexpected easier, which is the real power of being debt-free.

So back to our question… is being debt-free the new rich? I’d say there’s a very good case for it.

Thanks for reading, what are your thoughts on the new rich?