Feeling underwater in debt?
In episode 19 of “Can I Ask You One Question?”, I ask Dr. Aaron Neufeld (co-founder of ODs on Finance) for some advice on getting out of debt and moving toward a destination few people get to.. financial independence!
Below are the key points from the interview. Scroll down to see the entire interview.
Are you feeling underwater with regards to debt?
There’s not one specific strategy that’s good for every OD. It depends on your personal perspective, personal plan and future goals.
Let’s start the first HUGE hurdle… Student loan debt which averages $200K – 300K.
Second, how to get yourself set up for the future, including kids, mortgage, family, investments and whatever else life throws your way.
On top of everything else, becoming a practice owner adds additional debt.
“How do we put it all together so we can live a normal life?”
First things first… have a game plan! Write out what you’re going to do.
Should I just focus on paying off my debt?
You don’t have to eliminate debt all at once. You do want to mix debt reduction with growth investments. You also want to have some cash.
But, you also don’t want to let that debt pile up to the point you can’t control it.
The ODs on Finance approach has been to knock out debt in 5 to 10 years. However, you can knock them out mathematically in 3 – 5 years with about $250K in debt.
Uncle Sam takes his share, putting 50% of the remaining balance toward student loans, with the rest for living expenses.
So, live like a student for 3 – 5 years, but that will set you up for a better future.
If possible, Aaron recommends this over balancing loan payments and not paying them off in a timely manner.
Watch the interview below:
Ps. No time for videos (even short ones)? Subscribe to the podcast: Can I Ask You One Question? Bite-sized content you can immediately apply to your practice. Available on most podcast platforms!