Last Updated on March 30, 2023
One of the joys of retirement is your days finally become your own to do with what you will. However, if you go into retirement carrying debt, you’ll still have to give some consideration to servicing them, possibly through taking out a debt consolidation loan — which could rob you of the freewheeling experience you worked so hard to attain. This is one of the primary factors driving the importance of getting rid of debt before retirement.
Peace of Mind
It’s tough to ponder living on a fixed income when your debt load is both unpredictable and draining off your assets. What if you run out of money? What if something unexpected happens and requires you to spend even more of your nest egg?
Where will you live if it comes down to it and you can’t afford to continue making your mortgage payment or rent? Peace of mind has very little room to co-exist with thoughts like those swirling around in your head.
Preparing for the Future
Yes, we know, this is about as cliché as any statement can get. However, that’s exactly what paying off your debt before retirement does for you. Further, it gives you a preview of what life will be like when you make a concerted effort to live within your means.
The allure of credit is the potential it affords you to acquire things that might otherwise be out of reach financially.
As debt settlement enrollees attest in many Freedom Debt Relief reviews, what this really means is you’ll pay even more for items you couldn’t afford in the first place. After all, interest charges will be attached to every dollar you borrow, which has the effect of making the purchase more costly. Granted, it’s less of an issue when you’re still working, but it does you no good to be used to an unsustainable way of living.
Easier to Build Wealth
Boiled down to its barest essence, money has two uses. It can be employed to acquire goods and services, or it can be used to create more money. If you choose the latter, you’ll always be in a position to acquire goods and services.
However, if you choose the former, the latter will be considerably more difficult. If you pay off your debt while you’re still earning, you’ll be in much better shape to use your money to make money, so you’ll always have money to get what you need.
In other words, rather than making other people richer, invest those dollars to enrich yourself.
More Predictable Cash Flow
Granted, this one goes hand-in-hand with peace of mind. However, what this also means is more of your money can go toward preparing for your retirement when you pay off your debt before retiring.
With no credit debt to service, you can funnel more of your money into pleasurable pursuits. You can also count on the fact your money will be there to do with what you will, as opposed to what you must.
Minimal Strife — Happier Life
Reducing your worries is the primary reason getting rid of debt before retirement is important. It really helps to get used to living within your means before you need to do so. Going into retirement that way makes a huge difference in the quality of your post-career life.
Further, it is almost impossible to overestimate the value of peace of mind, wealth building and predictable cash flow when your income is fixed at a certain level. When the day comes you can finally settle down and do what your heart desires — rather than what your situation demands — you’ll be glad you got rid of your debt before you retired.