On the way home from lunch today I tuned into some radio station that had a mortgage show on. Basically it was a lender trying to convince people that the road to financial freedom was to mortgage the hell out of your house so you have only one bill. Of course, that was good for the lender that sponsored the show.
There is only one road to financial freedom and that is to be financially free. Don’t owe people. Sure – you may need a mortgage (I sure have one). You may need a car payment, because we all need cars here in the US (unless you live in a very large city). Maybe you don’t need a $45,000 Beemer though.
But that doesn’t mean you need to owe credit card companies, furniture stores and/or home electronic stores.
The true path to financial freedom is a very, very simple one: Owe as few people as possible. Invest the rest.
Hey, I don’t get paid for this advise, but I do know what I am talking about – I’ve been on almost every spectrum of income levels from poverty level to the uber-wealthy (according to the IRS). The truth is that I was never as financially insecure as when I was making very good money, and spending all of it. And then some. I was never wealthy, no matter what the IRS thinks.
You want to be financially free you need to do without things until you can (*gasp*) pay for them. NOT finance them. Not buy them on a credit card.
I’ve only learned recently in life that saving for something I really want – forcing myself to either pay cash for it or do without it – that’s the only way to financial freedom. Otherwise the banks and credit card companies will own you for eternity.