Posted by Tim Stobbs on June 3, 2011
I have an interesting email earlier this week which I won’t post the entire email, but in summary Rochelle asked:
My question is about how you manage to keep your “eye on the prize”? How do you keep strong during your end-game? Have you had to deal with any of these major temptation delays? Do you fear being debt free and potential let down you might feel once you have attained that goal?
I have literally asked myself almost the exact some questions several times in the last couple of years. Perhaps not all at once, but almost the exact same wording.
The answer depends heavily on your motivation for becoming debt free in the first place. My personal motivation for becoming debt free has largely for the desire to have that added flexibility once we hit that state. At that point I can either continue to work at my current job or switch careers to something else that pays less if I want. Since I’m personally still not sure about if I will fully go for full financial independence or just a semi-retired state I personally put a greater value of paying off my mortgage that people with other plans.
Yet the one issue that seems to keep coming up is should I accept some debt for investment purposes. In this case I have been faced some major temptations over the last year as I’ve looked around at some investments which potentially could earn me more than paying off the mortgage. While I keep considering stopping the additional payments to do this, I keep reminding myself of my motivation of getting rid of the debt in the first place.
In Rochelle’s case the motivation might be different, so an investment might make sense if being debt free isn’t essential to her plans. If being debt free is desired, then here is how I’ve dealt with the issue: keep busy with other things.
Honestly, that is the best idea in the world when you have a problem you aren’t sure how to solve. By working on the other areas of your life, you make progress on things that are important to you but also free up your mind from the treadmill of your current thought to realize how you feel about it. Problems like this are often best solved when you come at them sideways, the emotional part of the decision is actual the major issue. On the money side it is usually more clear cut: will you make more money going into debt than staying out of it? The emotional side is where the problem lies thus logic here won’t be particularity useful.
So while at times the decision seem obvious that I should push off paying down the mortgage to invest instead, I’ve chosen a different path because it feels right to me. It took me a while to realize that the issue was not in my logic, but rather how I felt. I hope that helps.
Anyone else got some ideas on what Rochelle should do?