Investment 101: Characteristics of Debt-Free People

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As we grow older, we incur more and more expenses and incur more debts.

This can be hardly avoided as at times, what we are making simply is just not sufficient to sustain our needs. From paying the monthly bills, the credit card debts to maintaining the family home, debts will surely be a constant occurrence in your life if you are less than wise in your financial decisions. Admittedly, though we live in a relatively fast-paced economy compared to the years prior, earning enough to sustain our way of living may come a little bit harder than we expected especially when the product prices are at an all-time high.

And though this might be the case, what most people overlook and neglect to consider is the fact that merely changing your attitude and outlook regarding debts might be one way to stay debt-free. In fact, there are cases wherein a family who makes approximately twenty-five thousand pesos a month can pay off all of their debts by the end of the year compared to a family who makes a hundred thousand pesos a month and cannot seem to make a dent on their debts.

Simply put, the latter family has an apparent spending problem while the former family knew how to live within their means. Somewhere along the way, people have accumulated so much debt that one day they have decided that enough is enough and made serious lifestyle changes. This can range anywhere from refraining from dining out every night to making small investments in the Philippines for extra income.

Whatever it may be, these are the people who took a hard look at the state of their finances and overhauled their spending habits. These people do not necessarily do a 180 overnight. The fact is they are just rediscovering aspects of their personality that have always been there. Aspects that help them stay debt-free.

So, what are the characteristics of a person that stays debt-free?


This one bears no elaboration as it speaks for itself. Debt-free people are financially responsible, and they are aware of the degree of responsibility they have to exercise to get out of debt. Perhaps an experience of paying overdue debts might have ingrained this trait in them but one thing is for sure, these people are responsible and mature enough to know that money does not grow on trees and must be earned. Note that these people know how to treat their money, perhaps different than they did when they were still dependents. Responsibility teaches you to get out of debt as early as possible. This is so you can begin saving and start investing. A concrete example would be holding off unnecessary expenditures until the mortgage fee is paid.


Debt-free people do not place too much value on materialistic stuff, and they only buy what is necessary. This is not to say that they are miserly and that they do not invest money in something they enjoy. They do, but the difference between people who are debt free and those wallowing in debt is that debt-free people know how to do this in moderation. To be succinct, if you have debts piling on the table, it might be best to forgo buying an expensive bag.


Unless you win the lottery, you cannot get out of debt overnight. Debt-free people know that, and they are aware that though there are some things they would love to buy such as a new flat screen TV or a brand new gadget, it is best to hold them off until they have successfully paid their debts. After all, nothing is more priceless than not having to worry about incurred debts.


Pretty self-explanatory as getting out of debt in itself is already a goal. So, in essence, people who want to get out of debt as early as possible are goal driven and oriented. These people do not simply craft goals and set out their mind on how to achieve them—no, they have a clear plan on just how to get there. They are aware that impulse purchases will slow them down and what their priorities should be. Though these are relatively baby steps, these small goals help them achieve their goal of being debt free earlier.


Forgoing seeing a new movie, ditching eating at the new restaurant, rethinking a planned vacation—these are just a few of the things that you might have to sacrifice shall you want to be debt free. They are aware that they need to make budget cuts and lifestyle changes for them to get out of debt. Keep in mind that these are not permanent changes, though. Once you have sufficiently paid your debts, you can slowly start incorporating those into lifestyle again.


Getting out of debt may seem like an impossible undertaking especially when you have accumulated so much of it, but it is possible. The key is to maintain a positive attitude in getting out of it. Incorporate these five essential personality changes into your life and complement it with the right mindset, and everything will fall into place.


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