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What is it Like to be Debt-Free? (& How it Affects Your Life)


What is it like to be debt-free?

Please take a couple of minutes to imagine it.

Now, this is hard, I know. You may have so much debt that you always feel the weight of it. It is hard to imagine a time when the uncertainty of debt will not hang over your head, ready to drop and take your future with it.

Still, let’s try and do this.

You wake up in the morning feeling refreshed and peaceful after a good night’s sleep. You have a leisurely breakfast of your favourite food. Then, you start working, and your focus is laser sharp – no stray thoughts about unpaid bills, debt collectors or looming money crises. Life is full of possibilities, and you are brimming with excitement to savour them all.

You can pay off all your debt and become debt-free. An essential ingredient to that is motivation.

In this article, I’ll share with you some surprising and transformative benefits of living a debt-free life and hopefully, you will be raring to go on a debt payment journey by the end of it.

Are you ready?

Benefit 1: Being debt-free is living stress-free

An immediate and remarkable benefit of being debt-free is the overwhelming reduction in stress.

Financial stress can take a toll on your mental and physical health. Studies have shown that individuals burdened by debt are more likely to experience anxiety, depression, and even heart problems.

I know I did. I still remember the darkness that swallowed me the moment my husband told me how much debt we had. I didn’t sleep for weeks. My insides were shaking like autumn leaves. And I developed high blood pressure and was put on medication.

All this changed when we paid off our debt. And today, I am glad we have no consumer debt – it makes us vulnerable and causes too much stress. I’d choose debt-free living any time.

So, here it is – being debt-free is less about money than about living free of stress and looking into the future without fear. And without worrying whether your loved ones will inherit your debt.

Benefit 2: Debt-free living is a healthy leaving

Reducing stress levels is known to improve health. Lower stress means fewer colds, no impression and anxiety, lower blood pressure and reduced incidence of heart disease and strokes.

Financial health and physical health go together.

I always thought my blood pressure went down because we brought Suzy the Dog into our family. (Yes, pets are also known to have health benefits.) Thinking back, we also paid off our debt.

Who knows, right?

Benefit 3: Becoming debt-free is your ticket to freedom

Paying off your debt is not only financially liberating. It also offers you the gift of time.

You have more cash to follow your hobbies. You can reduce the hours you work and pursue new opportunities. You can also start saving and investing for a future when you will achieve financial independence.

Debt freedom brings all kinds of freedom.

Benefit 4: Confidence boost from paying off your debt

Becoming debt-free often comes with a boost in self-esteem and confidence.

Taking control of your finances and conquering your debt instils a sense of accomplishment and empowerment.

This confidence spills over into other areas of your life. After all, when you’ve paid off so much debt, not much can faze you.

This is why I believe there are excellent reasons to celebrate your debt, not hate it.

Benefit 5: Reimagining retirement without debt

I remember the first thing I thought when I realised how much debt we had – I would never be able to retire.

This was one of many negative thoughts. I had to deal with them to create space for dealing with our debt.


We paid off all our consumer debt in three years instead of ten. We increased our income and invested. Several years back, I reduced my professorship to 50%.

This is partial early retirement, right?

I couldn’t have done that if we were still in debt.

Benefit 6: The ripple effect of becoming debt-free on relationships

When my husband first told me how much debt we had, I raged and railed and cursed my lot. I was furious with my husband, the economy, and my refusal to engage in money decisions.

When acceptance downed, I stopped being angry. We started working together to pay off the debt, and once this was done, we continued to work together for our future.

Our relationship was stronger than ever, and we were, and still are, true partners in everything.

Benefit 7: Generosity and debt-freedom

It is true: you cannot help anyone before you help yourself.

People in debt are too focused on their survival to consider the lot of people around them.

Once we were debt-free, we started contributing to different charities. And I am not talking the occasional contribution here; we have monthly payments to charities we believe in.

Benefit 8: Living debt-free means we can enjoy beauty again

When burdened with debt, people worry about survival, not beauty.

We have lived consumer debt-free for ten years now, and it means that I:

  1. Go to the florist and buy flowers.
  2. Book tickets to the theatre/concert.
  3. Take my PhD students for coffee and pay for it – after all, I still remember how broke I was.
  4. Don’t worry about my son going hungry.
  5. Don’t have nightmares about living in a Dickens novel, especially not Little Dorit.
  6. Live my future rather than only dream about it.
  7. Go to bed and fall asleep without medication.
  8. Wake up without butterflies of tension in my belly.

Finally, what is it like to be debt-free?

In conclusion, what is it like to be debt-free?

It’s like stepping out of a dark tunnel into the sunlight of possibility and freedom.

The benefits of debt-free living are not limited to financial security but extend to improved health, increased confidence, and stronger relationships. It’s a life where dreams become achievable, retirement becomes enjoyable, and generosity becomes second nature.

If you find yourself burdened by debt, remember that taking steps towards becoming debt-free can lead to a brighter, more fulfilling future.

Start your journey today, and you’ll go from debt nightmares to living the dream.


8 thoughts on “What is it Like to be Debt-Free? (& How it Affects Your Life)”

  1. Although I am not completely debt free, I feel very comfortable with my financial future in retirement. More importantly, I can do almost anything I want, but choose not to. Maybe that is the best part, hving choices!

    • @Krant: Quite! Having choice is a big one for me. I wish I were able to choose to put more in the ‘overflow’ account for investing at the moment but it will all work out fine :).

    • @Daisy: Yep, I know it sound funny. When John told me how much consumer debt we have this was the image that came to my head: the debtors’ prison in Dickens’s England. My nighmares were always back then. Now, I have this nighmares about going on a cruise – John would love to and I can’t abide boats; even large, luxury ones.

  2. Being debt free would mean peace of mind for me and the joy of being in control of my finances again. It’s been so long. But have been following one great blog which is really helping and found The Money Principle via that. I also dip in and out of MSE. I am now late 50’s and so regret not having had all this good advice when much younger. But my family will benefit as they are now following the blogs and committing to future financial planning. So very grateful for that.

    • @Pandora: Don’t regret things, my friend. Sometimes I am tempted to look back with regret. I tell John that if we got awakened financially 10-15 years ago, we will be ready to retire (or at least have choice) and will be wealthy, able to do some much good. It is true – we could have done all this back then. But it wasn’t meant to happen like that – now and tomorrow is what matters.

  3. It would mean waking up and not starting my day already in the hole countless dollars … not as visceral as the everyday examples above, but as a small scale internet entrepreneur, I’ve begun thinking in terms of dollars per day as far as income is concerned.

    To take a day off and not be too concerned about falling behind would be AWESOME!

    • @Tom: I looked at your site – looking good. I know what you mean and I am certain that you’ll get there. Have you read anything by James Altucher? Just this morning I was reading an essay of his where he says that we see working for ourselves as freedom; in fact it is slavery. But it is still so liberating :).


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