Emmanuel E. – City Honors College Preparatory

“The Road to Being Debt-Free”

Many people in America are caught up in the monster that is debt which is the result of bad money saving strategies. These types of people can’t find true financial independence. Financial independence comes with living within one’s means, eliminating total debt, retirement, and most important of all peace of mind. The consequences of being in debt or struggling financially is that people maybe living paycheck to paycheck or don’t think they make enough money to suit all their needs when it really comes down to them not having a good savings plan which can cause stress and anxiety. This essay will show three out of many various ways of achieving true financial independence in life.

One of the most important methods of gaining financial independence is learning to spend within one’s means or staying on budget according to your expenses and the total income you make. Many celebrities gain a lot of money during their profession, but decide to spend that money on lavish things that they really don’t need. What’s even worse is than once that source of income stops and they use up all their remaining money they go into bankruptcy. It’s imperative to learn what you need to spend on and how to stay on budget. Sometimes you might have to forgo that new car you wanted to purchase so badly just to stay out of potential consumer debt.

Another helpful reminder is that having a good credit score can take some burdens off of you when dealing with mortgages and car loans for example. Having a good credit score indicates to a lender than you are responsible and a very reliable person when it to being charged for taking a loan, because they know you will be able to repay them back that loan. Having a good credit score also increases the likelihood of getting good interest rates when borrowing money from the bank.

The final method which might arguably be the best one out there is to start   a long term saving plan. This is especially useful for retirement since you don’t have to worry on paying bills or any form of expenses during retirement. This can be achievable by contributing to an employee-sponsored 401(k) plan or by simply saving money in an account that is specifically for retirement. It’s beneficial to start early, because there’s a greater chance for your money to grow overtime due to the interest gained throughout the years.

All of these methods and many more all lead to the same outcome which is peace of mind. The feeling of not being worried about next month’s rent or other forms of expenses is a feeling every American should experience in their lifetimes. For people who are currently in debt they can use these methods to slowly get out of the huge hands which is called debt that plagues so many adults today. Achieving financial independence is something that can change how you spend the remainder of your days in the future.