Avoiding debt is key to maximizing your freedom.
If you haven’t got a massive mortgage/rent/car payment to cover each month, you will probably have some money in the bank. You will certainly be able to save – to accumulate capital – which gives you leverage as well as options. You will for instance have the freedom to not work at a job you don’t particularly like or with (and for) people whom you dislike.
You are much more free to work as you like.
I here use myself as an example. I freed myself when I moved to a rural area with a much lower cost of living; I used the money I made from the sale of my old house in the expensive suburbs of Northern Virginia to buy a place outright in The Woods – as I like to call my southwest Virginia home.
I am now free to publish my own “newspaper” – EPautos.com – and can write about things I could never have gotten away with writing about when I worked for a major newspaper – and was dependent on the income from that job.
No more bending knee.
Another perk of being debt-free is that you can get by on not very much. This takes most of the stress of modern life off one’s shoulders.
But how to avoid debt?
One way is to avoid insurance – which has been oversold to people on the basis of Fear peddling. The insurance mafia has been wildly successful inculcating a pathological dread of imminent disaster and perpetual threats coming from multiple directions.
Are you covered?
Most of the time, of course, nothing catastrophic happens. The insurance companies know this and bank on it. Specifically, they bank on your not realizing it.
Put another way – the odds are in your favor, as far as losses. That it is far more likely you will pay in – for decades, ideally – and that they will never pay out.
This makes insurance companies among the most profitable cons going. Kind of like Social Security – but even more so because with SS, there is at least the possibility of eventually getting something back.
Not much, but something.
With insurance, you are 100 percent guaranteed to get back nothing.
Instead, they put their money in the bank. This serves two excellent purposes, the first and obvious one being the saving of money that would otherwise be spent on . . . nothing.
Which is hugely profitable for those selling it.
But it is a very bad investment for the person buying it.
By putting aside the money rather than spending it on nothing, the money will still be available to spend on something – whether it’s a cracked windshield, a broken leg or a tree that fell on the house.
In other words, it will serve as insurance.
It can be leveraged to make more money.
That is an investment.
Consider as an example home insurance – which is still optional if you don’t have a mortgage. If you pay $1,500 annually – this is the ballpark average for most single family homes – you will have spent almost $38,000 after 25 years – not factoring in the money you could have made investing that money or just earning interest on that money. How likely is it that you would have had to file a claim amounting to that sum during those 25 years? Wouldn’t it be nice to have that $38,000 at the end of those 25 years? Or even the $1,500 extra in your pocket each year for the next 25years?
This, probably, is exactly why certain parties cannot abide insurance being optional. It is their goal to make all insurance mandatory.
Because good ideas always require force.
The fact that insurance is increasingly hard to sell on the merits – and that many people would surely decline coverage if they were legally permitted to say no thanks – says a lot about the true nature of insurance as it exists today.
As insurance has become compulsory, it has become even less affordable. For two reasons, the first being the obvious one – that when a seller can force you to buy something, he can and will charge you more for it. What do you suppose the price of a cup of coffee at Starbucks would be if the government decreed you had to buy coffee at Starbucks?
The second being that when insurance is used to pay for routine things like stone-cracked windshields, physical exams and trees that fall in the yard during a storm, it is no longer insurance.
Insurance is – was – a way to distribute the cost of an unlikely and catastrophic event among a large group of people, thereby lowering the cost of the coverage for the same for all.
Back when insurance was legitimate. Not a government-enforced scam.
Today, the actual though unstated purpose of insurance is to keep people paying endlessly for “coverage” – which becomes ever more costly precisely because everyone is using it to “cover”everything . . . stone-chipped windshields, flu shots, tree branches in the yard, etc.
Which serves to keep the “customers” (at gunpoint) in debt.
Which serves to keep them from being free.
. . .
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