Peace of Mind is the Prize

Joan Otto, at Man Vs Debt, wrote a great post titled What Does Wealth Look Like To You?

She talked about her view on a book she just read titled The Millionaire Fastlane and some thoughts that the book brought up in her mind.

She ended the post with the question: “What does wealth look like to you? Is it a Lamborghini? A huge house? Awesome vacations? Or is it something else – the ability to donate $20,000 instead of $20 to a cause you’re passionate about? … So what does wealth look like to you?

She got a lot of interesting comments and answers to her question. Here is the answer I provided.

“Very helpful review and insight on the book Joan. Thank you.

Wealth to me is a sizeable net worth (assets minus debt) and peace of mind. And on the subject of debt, my view is that when a person focuses on building a strong net worth, together with peace of mind, they are naturally led toward paying their debt down.

There are two reasons. The first is the math of paying their debt off quickly increases their net worth. So it makes sense to bring debt down since it grows their net worth over time.

The second is paying off debt relieves them of one of the larger stresses in their life. As they taste the freedom that comes from becoming debt-free, they realize they are being wise with their money and reducing some of the financial risk in their life. It feels better. It feels lighter. It feels like, well, peace of mind.

Then they look at their ever growing net worth and they feel a sense of pride and accomplishment and (you guessed it) – peace of mind. That’s wealth to me!”

I hope you will give some serious thought to paying your student loans off quickly so you can grow yourself a nice, comfy net worth – and peace of mind. :-)

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