This piece is part of my 2016–2026 archive migration. Some original formatting, content, and external links may be missing, changed, or not be optimized.
Create a launching pad for when your debts are paid
Time.
It could take someone a decade or more to pay off all their debts; that’s ten years of compound interest you’re losing.
It doesn’t matter if debt interest rates are higher; consistent investing and saving can’t hurt you and your financial future.
People who invest early tend to be better off financially than those who enter the investing game later.
You might’ve heard the stories or seen the charts depicting the 20-something-year-old investing a modest amount once or a few times and the 50-year-old investing lump sums, yet can still not quite catch up because of compound interest.
Compound interest is best friends with the young. The earlier you start, the more aggressive compound interest works for you.
Start investing now.
Don’t delay.
According to Dave Ramsey, you should only start investing once you pay down your debts, which could take years to complete.
If you de-prioritize investing to pay off debt, you may never invest. Most people carry debt to their graves – whether through student loans, car notes, mortgages, personal loans, or credit card loans.
After graduating college, I had about 60k in student loans.
But I continued saving and investing because I knew I could not get time back, and I was young.
The best thing you can do for your financial future is invest as early as possible.
My philosophy was not to focus on paying my debts.
Instead, my primary focus was to build a positive net worth; this mentality expedited paying off my debt.
I didn’t experience any adverse effects. My only regret was that I wish I had invested more.
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I get it; paying down debt feels good, looks good, and mitigates financial anxiety. But I bet you’d feel even better if you tackle both simultaneously.
There’s nothing better than paying down your debts AND having money in the bank.
While you’re destroying debt, you can be building wealth.
When you solely focus on paying down debt, you might pay down your debt faster, but you’re not building anything in the meantime.
What do you do in an emergency situation that costs more than 500–$1000?
Well, you’ll likely use a credit card or borrow money to pay for the expenses, which puts you in even more debt.
Building Wealth Is A Holistic Approach
Investing
Paying down your debts
Living below your means
When you do all three, you’re on track to build wealth no matter what.
When you only do number two, you’re setting yourself back when you pay everything off (if you stop accumulating debt).
Create a launching pad for yourself by building a nest egg that continually accumulates while you eradicate the liabilities.
This content is for informational purposes only — not professional advice. Consult a qualified professional before making any major decisions.