7 Key Traits of People Who Are Debt-Free

People Without Debt Develop These Characteristics

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People with no debt are a rarity in our easy credit, instant gratification, consumer-spending-driven world. 

But such folks can be found at all income levels. These people aren’t special or superhuman. They simply have some attitudes and traits that enabled them to get free of debt, and stay that way. 

It’s important to understand that debt-free people aren’t always born with these traits. Some were fortunate enough to be raised by financially responsible parents who imparted many of these attitudes.

But most people come to the debt-free lifestyle after years of indebtedness and money-related stress. They develop these traits as they begin the process of re-shaping their financial lives. It’s not easy to change habits and attitudes, but those rare debt-free Americans did it. 

Related: The Average American Holds More Debt Than Greece

And so can you.

Here are seven common traits of folks who live financially free and clear:

1. Goal-Driven 

They understand that if you don’t know where you’re going, you’ll never get there. They set money goals, starting with getting out of debt, and organize their financial life around those objectives.

2. Smart 

Debt-free people don’t fall for marketing hype that tells them the “deserve” a new luxury car. They don’t believe debt is a powerful tool to help create the life you want. They know most debt is an ugly, addictive thing that can limit their options both today and tomorrow.

The happiest retirees understand this and work hard to eliminate debt, including their mortgage, before they stop working.

3. Disciplined 

They have prioritized getting/staying debt-free, and do what is necessary to achieve that goal, day-in, day-out. Debt-freers follow their budget. They do without niceties until they can truly afford them.

They understand that not eating out, or skipping the hot new family movie (until it’s on DVD) is a temporary sacrifice.

4. Non-Materialistic 

Let’s face it. Americans are borderline hoarders. We’ve all got at least one item in our closet or garage that’s never been worn or used. Debt-free people tend to have less interest in amassing “stuff.” They derive their happiness not from things, but from experiences and from knowing they are financially secure.

5. Patient

They are able to delay gratification. They know the joy of paying cash for something they really wanted and saved up to buy. They have a vision for retirement and other long-term goals and the ability to steadily work towards them.

6. Responsible 

Household needs always come first in allocating their resources. They do the hard work necessary every day to make sure true needs are met within budget, and they resist the temptation to take on debt for wants. 

7. Secure 

Debt-free people exhibit some unusual financial behaviors — everything from not carrying a credit card, to skipping vacation this year, to buying cars for cash. But debt-free people don’t care what others think. They are secure in the knowledge they are doing the right thing for their family’s future.

Related: Most Common Financial Mistakes You Should Avoid

Disclosure: The Balance does not provide tax, investment, or financial services and advice. The information is being presented without consideration of the investment objectives, risk tolerance or financial circumstances of any specific investor and might not be suitable for all investors. Past performance is not indicative of future results. Investing involves risk including the possible loss of principal.