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I’m Not Really Debt Free


My brother and I are absurdly boring at family gatherings. We don’t see each other often, and when we do, we spend the entire time talking about finances or Dave Ramsey-isms. He became debt free at the same time and has as much zeal as I do about staying that way. We don’t share numbers, it’s more of a ‘Did you know the YNAB app has this feature!?!’ or ‘OMG, I had an uncategorized expense yesterday and lost my mind’ kind of talk. Nerds unite.

A relative came up to us and said, ‘You talk about being debt free but you both have way more debt than I do. My mortgage is $100K. Your California mortgages are way more than that. I can have credit cards out my ears and still have less debt than you.’

My brother and I learned a long time ago not to debate about finances so we smiled and moved on. Later, I couldn’t shake the comment.

My husband and I got lazy after we paid off our non-mortgage debt. We took our foot off the gas pedal. We figured, as long as we didn’t incur more debt, invested in retirement, and saved a little, we were good to go.

Over the last two years…

We went on trips.

We had too many restaurant meals.

We bought a little travel trailer.

Everything in cash. Everything budgeted appropriately. Honestly? It’s been awesome. We had a great time.

But it didn’t feel right and I couldn’t figure out why… until my relative spoke up. The reason the comment annoyed me is because part of me agrees with her.

Don’t get me wrong, you are never going to sell me on the idea that a maxed-out Visa is the same as my mortgage BUT, the debt should still annoy me.

Once a quarter, my husband and I go to dinner and talk about our big finance plans. We do our monthly budget in 20 minutes at the start of each month but we spend a couple hours each quarter prioritizing big expenses and making a plan. Things that need to be fixed on the house or replacement vehicle schedules or travel. A couple months ago, I added…

Our Big Ugly Mortgage

…then scribbled it out. That’s a stupid, impossible idea. We live on a single income in southern California and I don’t even make six figures.

My husband didn’t say anything. I figured he thought it was stupid too.

A couple days later, he said, “You had a great idea. I think we should pay off the mortgage.” He ran through some ideas he’d been pondering. He could pick up side work here and there. We could snip the budget a bit. He helped me believe we could actually do it within a decent time frame.

Was my relative right? Are credit cards the same as a mortgage? No, not even close. But am I insanely grateful for the remark that started the conversation?

You bet.

What about you? Do you consider all debt the same? How on earth would you have responded to the comment?


  • Reply Joe |

    Hi Beks,
    So glad to hear from you again. I fully admit that back in the day many of your posts (and Tricia’s before you) seemed so extreme (in terms of single mindedness of debt reduction). But given more time, hearing about your subsequent experiences and seeing the experiences of the bloggers that have come after you, I am convinced that that single mindedness is fully justified for real progress.
    Best of luck on the mortgage pay down. I am going to end up missing my goal of 10-year payoff, but hope to do it by 11!

  • Reply Kerry |

    Pay off the mortgage, don’t pay off the mortgage,whatever— but your relative is wrong because it’s two different types of debt whose interest is calculated differently.

  • Reply angie |

    I would have laughed. Made a fluffy wishy washy comment. Then later I would have joked about how dumb that comment was.

    Net worth and cash flow is what matters. Math is what matters. Not the total amount of debt you have. A well chosen house is an asset. Credit card debt is consumerism with typically nothing to show for it.

  • Reply Janie B. |

    I agree with your relative.

    If you still have a mortgage, you are **FAR** from “debt free!”

    (That applies to everyone else in the world, too, as far as I am concerned.)

  • Reply Susan |

    I think your relative is crazy. While your mortgage is indeed debt, almost all financial experts would agree that it is “good debt” (as long as it is not too large a percentage of your income, within financial guidelines, etc). I think you would do better long term to put extra money towards college funds, retirement accounts, etc. Put the money in an emergency fund, so you can write off your mortgage debt and also grow your savings, etc. I have a mortgage by choice and car debt by choice (both are lower interest rate than returns we are getting with our money in the market).This is one of those things where you need to think of LONG term financial planning and wealth building (not quarterly or yearly). If you can pay down the mortgage in 10 years, what will that money look like if you put it in retirement accounts (or 529 accounts) and have it for retirement/college? Mortgage debt is not the same as credit card debt.

  • Reply Sarah |

    Who cares what the relative says (though, I’d much rather have a larger mortgage than credit card debt. At least with a mortgage, you are building up equity). You have to have a place to live. You either have no mortgage, a mortgage or rent. Of course, I would rather have no mortgage but I’d rather have a mortgage than rent. I think it is the size of the mortgage that matters and here in California, that is more than other states (but again, a mortgage that you can afford is much better than paying rent).

    We chose to pay off our mortgage two years before our first son went to college. We then used savings and cashed flowed college payments. When our second son went to pilot school, it was tight for a while but it all worked out. Now they are both done with their job training, we are debt free and just returned from a lifelong dream trip to Kenya. Could we have done that while still paying a mortgage? Maybe, maybe not. But we paid for it with cash and had a fabulous time and want to go back.

    • Reply Beks |

      You are living my DREAM! Our goal is to pay off the house several years before our oldest is in college (he’s 8) so we can cash flow it. I love to hear it worked out for you! Kenya!?!?! I’m jealous!!!

  • Reply Monica |

    In my opinion, debt is debt and I know what financial peace feels like. I’m completely debt free including my home. My goal was by my 50th birthday or 20th anniversary. We made it by the 20th. A year later, I was gong through a divorce but G-d has been so faithful to me and my children.

    I had been a stay at home mom and homeschooled our children for 16 years. So I was totally blindsided but In the end and by G-d’s grace I got the house (valued is $250,000). Currently, I’m a teacher apprentice and the truth is I would not be able to live in my home if it was not paid off.

    In April 2020, I will have lived here for 20 years. So for me it gives me choices and the ability to give more. I would encourage everyone to put paying off their home as a top priority.

    • Reply Beks |

      Congrats! So sorry to hear of the split. : ( Glad to hear you paid off your house!! We are a homeschool family too so I feel ya!

  • Reply SMS |

    Good to see you here again! I don’t know which type of debt is worse – both are bad. Credit card debt because of high interest and because if you have it, you are living above your means. Mortgage because in the worst case you could lose your house. When I was faced with that choice years ago, I chose the mortgage (it was actually a home equity loan). As a single homeowner, security was more important. Then I took the money that had previously gone to the mortgage and paid off the credit cards.
    Your relative: she has lower debt, but if she lives in a lower cost of living state (sounds that way), then she probably has less income to pay it down…so the burden on her is just as heavy. Having said that, I probably would have responded just as you did!

    • Reply Beks |

      Correct, the value of the relatives house is roughly what she owes and her income is less. We have more equity.
      Thanks for the affirmation!!

  • Reply Louise |

    Are you in negative equity with your house? Then you are not debt free. If you could sell your house and fully pay off the mortgage, you are “debt free” in my mind, although because housing markets can change you are not in a guaranteed situation. I would still focus on paying off that mortgage. Every cent you pay now saves you interest/money and indemnifies you against future market crashes.

So, what do you think ?