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Debt Free Step Seven: Living Debt Free

Getting into debt is like craving pancakes at midnight on a Tuesday when you know the 24-hour diner is a good two hours away…

Getting into debt is like craving pancakes at midnight on a Tuesday when you know the 24-hour diner is a good two hours away. Your conscious tells you not to do it, but all reason is thrown out the window when your grumbling stomach begs for that mile-high stack of sticky carb pucks and a side of sausage links. (As if you’d listen to that tee-totaling little twerp of a conscious anyway, right?)

Note: This is the last article in my Debt Free in Seven Steps series.

But when you wake up the next day after barely three hours of sleep, with a food hangover that limits your activities to within three meters of the toilet, you realize, just maybe, the pancakes were a mistake. There comes a time for everybody in debt when the light bulb goes on and the panic—like the mad dash for the bathroom—begins.

I’ve come a long way from being the ignorant little college punk that threw around credit cards like I had just won a Powerball jackpot. I’ll be paying bills for a while, mind you, but at least now I know the importance of “living within your means”. I can live without my credit cards. Can you?

Whether you’re paying off debt like me, finally debt-free, still a credit card addict, or even if you don’t even have a credit card yet, you must come to the realization that there is only one path to living debt-free, and that is to live below your means. It’s not easy. We live in a world where material wealth is a false idol. And even if you are strong enough to resist the temptations of over-consumption, having “enough” money will always be what keeps the roofs over our heads and the food on our tables.

The choice to live below your means—like the choice to get out of debt—is a psychological decision, not a financial one. Getting into debt or staying in debt is a bad habit and, like all habits, is hard to break. But just like smokers can quit and overeaters can lose weight, if you choose to live debt-free, you can. Nothing is stopping you from cutting up your credit cards, living in a more modest apartment, or finding a second job. Often, you may have to do all three, but the long-term benefits will be worth it. People can change, but don’t be deceived, making a lasting positive change, whatever it is, can be extremely difficult.

Like any psychological battle, two ways to increase your chances of successfully living debt-free are to take small steps and to share your experiences and hear from others. If, overnight, you pay every penny towards your debts and cut out everything too many things that brought you enjoyment in life, you’re probably going to go into more debt by the end of the month. If, however, you can commit to not incurring new debts while putting a modest extra amount of your income towards your debts, you will find that you will begin to come out of debt without thinking about it.

Also, changing can be difficult if you don’t have support. If you have rich friends or have been secretive about your financial struggles, people around you won’t understand what you’re going through. If you don’t have immediate friends or family you can talk to, blogs like this and other web forms can help, but they may not replace in-person support.

I hope that my Debt Free in Seven Steps series was helpful. Check back to Money Under 30’s Credit & Debt section for even more advice. The wealth of personal finance knowledge now available on blogs is an incredible asset that wasn’t around when I was making financial mistakes and waking up to the dangers of debt, so take advantage of it, and good luck living debt-free!

Published or updated on September 22, 2006

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About David Weliver

David Weliver is the founding editor of Money Under 30. He's a cited authority on personal finance and the unique money issues we face during our first two decades as adults. He lives in Maine with his wife and two children.


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  1. Adam says:

    So…we’re on track to be completely debt free (houses, cars, EVERYthing) by the end of 2012. Once that’s done, what pointers can you offer for saving that superfluous monthly income?

    My thoughts are that a percentage of that money should go into 5 categories:
    1. Retirement (401k / IRA)
    2. Long term investments (precious metals / funds)
    3. Emergency Savings (medical emergencies / unexpected big expenses)
    4. Future House / Car purchases and maintenance
    5. Fun Money (vacations / TV / computer)

    Any categories to add or remove? Proposed allocation to each category?

    Many thanks!

  2. […] David presents The Courage to Live Debt Free (Debt Free Step 7 of 7) posted at Money Under 30. Probably the biggest tool one has to get out of debt is the power of your mind. […]

  3. […] While you are paying off your debt and once it is paid off, it is just as important to live debt free. That means living below your means and not incurring any new debts. […]

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