03/07/2013 08:24 BST | Updated 03/07/2013 08:24 BST

Can You Live Your Life Without Debt?

Anybody between the ages of 18-30 will almost certainly have had a conversation with their parents or somebody from previous generations and heard the following expression: "If we couldn't afford it, we didn't have it."

When you've finished rolling your eyes at the memory of your parents, grandparents or some other relic moaning about "our generation" of big spenders and debtors and how great the "good ole days" were, it is worth thinking about that sentiment: If more of us - including the government, bankers and just about everybody else - had the same attitude towards spending, would we be in the financial mess we are in today?

As soon as the country falls into the mess of recession, that's when the prudence comes in, but by then it's too late. We're used to getting what we want when we want it in this country, and we've provided our own undoing as a result by living beyond our means. Still, we should at least expect to have public services, nurses, police, schools and hospitals around, right? After all, that wasn't anything to with our credit card bills being a little higher than they should be.

The last time I heard somebody say the classic "if we couldn't afford it..." line, it was because I was going back to university as a 28 year old 'mature' student, and it was the first time that I had ever borrowed money (in the form of student loans). I'd never owned a home, bought a car (I'm 32 and I don't drive) or took out any kind of bank loans. I didn't even get my first credit card until I was 22 because I could live without it. If anyone lived by the "if we couldn't afford it" ethos in this day and age, it was me.

Many of my friends did the opposite. My best friend bought a house when he was just 18, and the majority of my friends had bought cars, either a banger that cost next to nothing or by using a car payment calculator to make low interest savings on buying a great quality car. None of them got massively into debt, but I was always aware of how much more pressure they were on than me. They were always looking to cover their costs, whereas I was simply earning to live. Suffice to say, when I got my final student debt invoice after I graduated, I felt the extra pressure that comes with having debts at last.


The more I think about it now, the more I think that the "if we couldn't afford it" ethos is a bit of a myth. That generation were homeowners and car owners still (albeit during a time when it was easier to get on the housing market and cost of living was nowhere near as expensive), so they still had debts, they just didn't feel like a noose around the neck, like the mortgages, student's loans and bank interest rates of today. Money went a little further then, but they weren't living an entirely debt free life. The difference is, a lot of that generation are now debt free, whereas anyone who wants to get on the housing market, go to university or own a decent motor needs to get into debt.

I guess that you have to speculate to accumulate. I didn't take those risks, and I'm completely free of debt (apart from those student loans, which are on low interest rates), but at the same time, I don't own my own home and because I don't drive, I'm a slave to the timetables and functionality of the trains and buses of our good nation. It's a sign of the times: Do you run the risk of getting into trouble by getting into debt in order to move forward, or opt out and live on what you have, knowing that you might never end up with assets in the future? You can certainly live without major debt, but it could also hold you back in the long run.

Photo credit: Nastassia Davis [] via photopincc