Celebrating Debt Freedom: Top 4 Lessons I Learned After One Year

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debt free

Today marks the one year anniversary of paying off all my debts! It’s been a crazy year, but I’m thrilled I can celebrate this milestone.

During my debt-free journey I learned a lot — about myself, handling my finances and seeing a goal through to the end. But I think the biggest thing I learned was how strange life would be after debt.

My experience this past year has been similar to my experience of paying down debt, in that it takes a lot of discipline, and out-of-the-box type of thinking.

Being in debt is a normalcy in this society, so getting — and staying — out of debt is a crazy new thing altogether. You’re definitely going against the grain on this path.

So has it been worth it? What lessons have I learned after being debt-free for one year?

Sacrifice is empowering

After working multiple jobs, starting a freelance business and slugging through a day job that I really disliked, I came out on the other end a winner. The rewards to being debt-free are obvious — more money, inner peace and financial freedom.

But there are intangible benefits too! The biggest advantage to sacrificing and completing your goal is that you followed through and can now reap the rewards of your journey.

Now anytime I face a difficult financial problem or life choice, I think back to when I had debt and know that I can accomplish anything that’s thrown my way!

But financial freedom is boring

Before I paid off all my debt, my decisions consisted of multiple questions and complicated strategies.

  • Which bills should I pay first?

  • Which one has the highest interest rate?

  • Should I take this vacation or use the money towards debt?

The list goes on. But now, my decisions are much simpler. I pay my bills, put money into savings and investing, then use whatever funds are left for entertainment or other financial goals.

Once you’re out of debt, the decision making process is rather boring. There aren’t any complicated financial spreadsheets (like tracking debt snowballs or debt avalanches). There’s just simply living within your means.

It’s an awesome perk in my opinion! But if you’re someone who likes living on the edge, you’ll find that having full control of your finances, may not be quite as exciting as you’d think.

Slow and steady wins the race, and in a world of endless promotions and crazy financial endeavours, the road to financial freedom is simple and boring.

Going into debt (again) is easy

Like I mentioned, life after debt can be daunting. When everything around you is tempting you to spend more, it’s hard to constantly say no.

This is especially true once you have all your debts paid and the creditors are all but knocking down your door with new credit card offers and incentives. It’s ridiculous how easy it is to charge a few purchases on credit and end up in a couple hundred or thousand dollars of debt again.

Even when you have the discipline to get out of debt, you have to remain disciplined to stay out of it. Just because you paid everything off doesn’t mean you don’t still have the urge to spend or buy new things.

Debt has intangible benefits

Have you ever wondered if paying off debt has intangible benefits?

We already know the most common benefits of paying off debt:

  • More money in your bank account
  • Not living paycheck to paycheck
  • Freedom to spend your money how you want

But what other intangible benefits come from being debt free? Here are some very real side-affects I experienced when paying off my debts.

1. Less physical and mental stress

When people are dealing with mountains of debt, they’re much more likely to report health problems. Four of the five top causes of death in America (heart disease, stroke, cancer and lower respiratory diseases) can be triggered by stress.

And as we all know, one of the biggest contributing factors is financial stress. So as you pay down your debt, you reduce the amount of both physical and mental stressors. Which helps you become a healthier and happier person.

2. Better relationships

One of the main reasons for couples splitting up and getting divorced, is money fights and money problems. This was one of the reasons my marriage failed, so I understand firsthand the part financial stress plays in a relationship.

But by reducing your debt, you’ll be eliminating one of the biggest factors that contributes to stress within your relationship. Many studies have shown that happily married couples outlive singles, divorced and unhappily married individuals.

Having less debt means fewer reasons to fight about money and spending, which leads to more harmonious relationships. You’ll have more successful relationships – with your kids, your parents and of course your spouse.

3. Opportunity to fund your dreams

Reducing your debt lets you have the freedom to spend, save and give as you see fit. This means you can save for that vacation you want, or spend money on some new furniture for your home.

Having financial flexibility gives you and your money the opportunity to fund your dreams and goals, instead of funding someone else’s bank account. Instead of being in debt to credit card companies your whole life, you can take more risks and have more fun.

4. Peace of mind

I’ve said it before, but having peace of mind when it comes to your financial future is priceless. No amount of stuff or material possessions will make you feel as good as having peace of mind.

To be able to lay down at night knowing your family will be taken care of, that your kids can go to college and that you can work at a job that truly makes you happy. These are all intangible benefits that come with not owing debt.

They may not be evident when you look at them on paper, but sometimes life is about more than just doing the math. Once you begin paying off your debt, you might experience some of these unexpected but wonderful side-effects.

These are the biggest lessons I’ve learned after celebrating one year of debt freedom.

17 comments

  1. Great post, Carrie! And so timely for me, as you know. I’m looking for all the tips I can get re: how to adjust to budgeting, saving, etc. now that my money will be all mine. I’ve never lived a life like that before… it should be interesting! (Wait, you said boring! Haha.)

    I remember when you paid off your debt… crazy that it’s already been a year! Congrats 🙂

    • I’m glad you found it helpful Cait (and congrats on your own journey)! Adjusting to life after debt is different but totally worth it, and testing out new strategies is always fun. Good luck and I can’t wait to celebrate your first year anniversary!

  2. Mike@WeOnlyDoThisOnce says:

    Congratulations, Carrie! Good point that it is all too easy to slide back into old patterns.

  3. david says:

    Carrie, I really appreciate you posting this. I am going to send this post to my girlfriend who is now approaching reality about paying back her debt 🙂

  4. John S @ Frugal Rules says:

    Very well put Carrie! I think once you climb out of debt it can be just as impressive to stay away from debt as it was to get out of it.

  5. Janice says:

    Congrats on achieving and maintaining this huge goal! I recently achieved the same thing and unfortunately the credit card companies are already sending me preapproved offers. I throw them in the garbage without even opening them. It’s very scary to think about getting back in debt, but oh so easy!

  6. Carrie, my wife and I have been debt free (except for the house) for several years now. It’s kind of weird. Instead of trying to figure out how to make our money go far enough, we find ourselves making decisions on whether or not we want to splurge and pay cash for things we have wanted for a long time. Now that we have money saved up, we don’t want to spend it. :o)

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