Get expert insights delivered straight to your inbox.

Skip to Main Content

10 Characteristics of Debt-Free Living

Debt-free people are a rare breed . . . especially in today’s world. Just about everyone has bought the lie that financial peace only happens when your FICO score is above average, you’ve got credit card points out the wazoo, and your mailbox is full of credit card applications.

So, when you hear about people who have absolutely no debt, live on less than they make, and have a stash of cash for emergencies, you might think they’re . . . weird. But living a debt-free life isn’t only for a special group of people. It’s something anyone can do with hard work and some special characteristics.

Check out these 10 traits of people who live debt-free lives.

Traits of People Who Experience Debt-Free Living

1. They’re countercultural.

These people know debt isn’t a tool to help them win. Society tells us you have to have a credit card to survive, you can’t go to college without student loans, and you’ll always have a car payment. These are straight-up myths.

Those who are experiencing debt-free living don’t buy into these norms. Credit cards aren’t necessary for their everyday lives. Car payments don’t take a chunk of money from their budgets. They treat debt like it’s week-old meatloaf they found in the back of their fridge—they dump it fast. Debt is normal. So be weird!

We’re completely DEBT-FREE, y’all! We learned how to budget and also changed our perspective on money and our ability to work as a team to reach our financial goals. It has taken a lot of sacrifice and discipline. We’ve said no to many wants so we could save as much as possible, while still trying to enjoy the little things . . .” — Brandy S.

2. They use self-control.

According to Dave Ramsey, adults make a plan and follow it. Children do what feels good. Someone who really wants to get out of debt has the willpower to walk right past the shoe section (with the big sale) or the flat-screen TV aisle without making an impulse purchase.

They aren’t swayed to buy something simply because they want it or it’s on sale. They’re wise enough to know that purchases aren’t going to erase all their problems or make them feel better in the long run.

That’s why debt-free people don’t buy stuff unless they can pay cash. They are willing to wait, work and save.

3. They’re confident.

A person who believes in their money plan doesn’t care what others think of them. They’re fine with driving an older car because it doesn’t have a payment. They don’t need to take expensive vacations just to post a glamorous photo on social media. They actually look at price tags and not only at brand names. Why? Because they’ve given up trying to keep up with the Joneses next door.

And guess what? This kind of steadfast discipline frees up more money to attack their debts. With each debt they pay off, their confidence grows by leaps and bounds.

4. They aren’t afraid to say no.

It’s hard to live a debt-free life if you’re always saying yes to every social opportunity that comes your way. Whether it’s a shopping trip, vacation, eating out with friends, or even spending money on a whim, it’s important to keep the word no in your vocabulary.   

5. They set goals.

No-brainer, right? Debt-free living is a goal, so people who want to accomplish it keep that objective in front of them. They set goals that are specific, measurable, time-sensitive, yours and in writing. And they figure out what they want to do and map out a strategy to make it happen.

“I'm 21, I'm a business owner, and I have no debt. We are taking a bit of a different journey than others, but I am DETERMINED to never have a mortgage. We bought land last year for our future home. This year we bought a fifth wheel so we can continue living with lower expenses and save money [to build].” — Sara P.

6. They’re gazelle intense.

If you’ve taken Financial Peace University, you probably remember Dave talking about gazelle intensity. It’s when you’re so fed up with debt that you run as fast as you can (like a gazelle) in the opposite direction. This means they’re looking to squeeze every single dollar they can from their budget. They’re couponing, looking for sales at every turn, and even working a side hustle. They’re all in.

7. They don’t care about stuff.

Materialistic people put too much emphasis on “stuff.” They borrow up to their eyeballs to pay for vacations, fancy cars and even oversized houses.

money bills icon

Avoid the traps and manage your money the right way with Financial Peace University

But people who are determined to get out of debt know that money doesn’t buy happiness. They’ve become content with what they have.

8. They’re willing to make sacrifices.

Eating out, going to movies every week, and getting the premium cable package—these are the types of things a person might have to avoid while becoming debt-free. But keep in mind: Budget cuts are just temporary. Once the debt is gone, there’s more room in the budget for those dinner-and-a-movie dates.

9. They don’t compare.

Debt-free people don’t compare their lives to those down the street or on social media. They know they’re on their own journey, chasing after their own goals and dreams. And because they’re not comparing themselves to others, they’re more at peace and content with the lives they live.

10. They’re generous.

Debt-free people know that they have the freedom to live and give generously. They know that the more they keep their hands open, the more fun they can have with money. Whether they’re helping family, friends, church or a mission they believe in, it’s always more fun to contribute to a bigger cause than stockpile that money for themselves. Rachel Cruze says, “Giving is the most fun you’ll ever have with money.” Try it and see for yourself!

“Generosity is fun. It’s fun in big ways (when you get to help start a community fund close to your heart) and small ways (paying for the group dinner or contributing to a friend’s fundraiser on FB).” — Brittany B.

You Can Live a Debt-Free Life Too!

Once you decide you want to be debt-free, all you have to do is take the first step!

How? You need a plan that will help you get from where you are to where you want to be: living a debt-free life. Get that plan in our nine-lesson course, Financial Peace University. You’ll learn just how to work the debt snowball and get rid of your debt. Fast. The average household going through Financial Peace University pays off $5,300 in the first 90 days. That’ll give you a huge head start toward your debt-free life. All you have to do is take the first step.

Ditch Debt For Good!

Financial Peace University will show you the best way to pay off debt and make progress with your money.

Get Financial Peace

Did you find this article helpful? Share it!

Ramsey Solutions

About the author


Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners. Learn More.

Related Articles

Types of Debt

What Are the Types of Debt?

Debt comes in all shapes and sizes. Learn about the different types of debt and how to pay off your debt for good.

Ramsey Ramsey
Do I Need a Credit Card?

Do I Need a Credit Card?

Do you actually need a credit card? Despite what everyone says, you don’t need a credit card to build credit or buy a house. Here’s why.

Jade Warshaw Jade Warshaw