The Tension Brings Clarity
I had a fun e-mail exchange with a friend regarding my recent car-related posts. He shared how "liberating" life has been since becoming debt-free four years ago. However, his next comment is what got me. Since he was a new and now-committed member of the debt-free club, buying a truck would be a different experience. This now meant he "could not even consider" buying a truck without having the cash in hand. This changes everything! He added that while he had the cash to buy whatever truck he wanted (impressive move!), he ultimately decided to spend $10,000 less on his purchase (humble move!).
When we refuse to use debt to purchase vehicles, it creates a very palpable tension. It's hard to save a big chunk of money for vehicles. It's a long, thankless, and often unrewarding task. That's precisely the point, though. That process brings with it a tension that must be reckoned with. When it's finally time to pull the trigger on that new ride, we're faced with the reality of parting ways with so much of our hard-earned cash. That tension is brutal...and the cost high!
That tension also brings clarity. To explain this dynamic, I'll use the opposite example. Let's say my friend was truck shopping with the intent of using debt (you know, the normal way). He finds what he's looking for, falls in love with it, and needs to make a decision. He has two options in front of him: a $40,000 truck and a $50,000 truck (I made those prices up). The $50,000 truck is clearly better. It has all the bells and whistles....and a bigger engine! After doing the math, he realizes the $50,000 vehicle will "only" cost him $150/month more than the other. Considering that the $50,000 vehicle is superior and he likes it more, $150/month seems like an absolute no-brainer! See, there's no tension in the decision-making process. It's a number on a piece of paper. $150. That's not a needle-mover in many people's lives. We won't talk about the fact it's $150/month for the next 84 months.....that's for future him to worry about. Current him gets the nice truck right now!!! Again, no tension.
On the other hand, he's living in a new reality where debt is not an option. He has the same decision in front of him: buy the $40,000 or $50,000 truck. This time, however, there's a difference. Since he's writing a check no matter what vehicle he buys, he's faced with the proposition of trading an extra $10,000 of his hard-earned money for the nicer truck. It's ok if he chooses that one, but he will immediately have $10,000 less in his bank account. There's the tension!
The tension brings clarity. When faced with that tension, we almost always make better, clearer decisions. He knew exactly what he was getting, exactly what he was paying for it, and would face the consequences immediately. Tension and clarity!
He clearly and confidently chose the $10,000 cheaper option. That tension is a beautiful thing.