Smart About Money: A Wonderful Gift to Give This Year


All the pre-holiday heavy emphasis on buying-buying-buying got me thinking about a gift people can give themselves and their families — something precious, rare, and very, very valuable.

Being debt-free.

Does that mean being some sort of Grinch and not buying any gifts? Does that mean never using credit cards again and always paying cash? Does that mean never having fun spending money on stuff?

Of course not, to all three! Buying and giving are part of most people’s idea of happy holidays. Credit cards are, in most cases, perfectly useful financial tools that provide some benefits that cash cannot. And people who are debt-free still buy lots of stuff.

What does being debt-free mean then, and why bother making the effort?

To some people, it means having their home, auto and college loans paid off and all credit card balances paid in full every month. For others, it means no debt except a mortgage.

People who are debt-free know how good it feels not to owe money to anyone. Today’s income isn’t earmarked toward some ancient bill. They worry less. They can actively build their savings. And they save thousands on all kinds of interest. It takes hard work and dedication to get (and stay) there, but it’s an excellent place to be.

How can you get there? Here are three ideas to get you started:

1. Believe it’s possible to be debt-free. Many people, for example, believe they’re “always going to have a car loan.” They buy cars accordingly. People who are debt-free look for a well-priced, super-reliable car they can get 10-plus years from. They pay it off as quickly as possible — often in three years or less — and are auto-loan free for years at a time. These folks believe it’s possible and take every opportunity to make it happen.

2. Know yourself. Becoming debt-free means paying off current balances. There are all kinds of strategies. Some experts advise starting with the smallest debts, to get a jumpstart on knocking them out. Others suggest getting rid of the highest-rate debt first. Homeowners with equity may have the option of rolling higher-rate debt into a single loan that they work to pay down aggressively. (That only works, by the way, if you know you can trust yourself not to run up other balances again.) The bottom line: Choose your favorite method, and get started.

3. Make becoming debt-free your hobby. It’s actually one of the world’s most lucrative hobbies! Remember, though, that most people don’t get into debt overnight, and they won’t get out overnight.

Making it your hobby makes the journey more fun — talking to others about their money-saving ideas and tactics; sharing your victories with your family; and having your kids learn firsthand that it’s possible to live a wonderful life with minimal debt or no debt at all. That truly is a priceless lesson and an exceptional gift.

Nick Maffeo is the senior vice president, chief financial officer and treasurer at the Canton Co-operative Bank in Canton. Have a question? Email to

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avatar Posted by on Dec 7 2011. Filed under Featured Content, Opinion, Smart About Money. Both comments and pings are currently closed.
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