“A man in debt is so far a slave.”
-Ralph Waldo Emerson
After thoughtfully analyzing and researching financial planning, I have concluded the only rational choice is to strive to be debt-free. Every financial lesson I have learned during my life so far points toward this debt-free conclusion.
Consider this my Debt Free Manifesto.
On this page, I publicly acknowledge my financial planning will revolve around a commitment to be debt free, and I will constantly strive to live in a manner that does not require debt. The justifications of my decision can be found below — or in the words of almost every known reputable personal finance resource.
I. Financial Freedom.
Debt causes financial and emotional slavery, where every decision I make is factored on the basis of my obligation to another person and/or company. This obligation can cause me to miss fantastic opportunities, enjoyments, experiences and personal freedom.
Debt causes people to live a life they do not want to live, to make choices they do not want to make, and to put up with circumstances they shouldn’t have to put up with. In a sense, they are slaves to their debt. Because I do not wish to be a slave, regardless how easy it might be, I choose to be debt-free.
II. Financial Security.
Where there is debt, there is risk. Going into debt to start a business means that a failed business can ruin the life of the entrepreneur. Going into debt for a home can mean that a sudden shift in the real-estate climate can completely ruin the life of the owner. This was proven in the recent real-estate bust.
The ultimate purpose of money is material security. This means that the reason we want to have money is so that we do not have to worry about where our next meal will come from, where we will sleep at night, and how we will be warm during the winter. Because debt puts all of these at risk, along with every other material comfort, I choose to be debt free.
III. Financial Prosperity.
Where there is debt, there is loss. Banks give out loans for a reason; they are literally selling money. If you get a loan, you are consciously agreeing to give two dollars for one dollar. You are agreeing to pay more for less.
Unless this loan is specifically for an investment that will earn more than the loan interest and inflation, then it is inherently based on a loss. The financial loss might be gradual, but it’s still a loss. For the sake of mitigating loss and maximizing true net-worth, I choose to be debt free.
IV. Financial Future.
Debt is a short-game move, and sacrifices the future. Every house has to actually be paid for by someone. Every car has to be paid for by someone. Debt simply is a “Buy Now” button with a dramatically increased price.
If only the short-term mattered, then debt would be a wonderful choice. However, future will come, and and I can’t out-maneuver it. Because I refuse to focus entirely on the short term, and recognize that all actions have consequences, I choose to be debt free.
V. Financial Education.
“In a time of universal deceit, telling the truth becomes a revolutionary act,” said George Orwell. Unfortunately, we are pressured by advertisements, marketers and others that our lives will be better with just a little more debt. We are told that a comfortable life is not possible without a little debt. These claims are simply not true.
Because I firmly believe that debt destroys lives, I know it my “obligation” to explain, instruct and to help others who wish to honestly and productively live their lives to the best of their means. Because of this, I choose to encourage others to strive to be debt free.
Debt is slavery. Debt is destroys financial security. Debt hinders financial prosperity. Debt ignores the future. Because of that, I choose to be debt free and to educate others about the dangers and pitfalls of excessive debt.
Note: I do not retain any “copyright” over this declaration. If you agree with this manifesto, feel free to repost it on your blog, website, Facebook/Myspace or anywhere else. Let’s help others become debt free.
This is part one of the series How to Get Out of Debt.