Robert Brokamp

Yeah, I agree that paying off the high interest rate debt is probably the right move financially.

And for most people, that'll be credit card debt.

The average rate on a credit card these days is between 20% and 25%, so probably would be starting there.

Average rate on a car loan is around 7% for a new car, 10% for a used car, so that would be the next step.

And then there's mortgages, right?

The current rate on a 30-year mortgage is 6.2%, but many people have lower rates.

According to CNBC, about 50% of homeowners with mortgages have loans with rates at 4% or lower.

But I do think that Dave is onto something when it comes to acknowledging that debt has a psychological component, and we're doing that with our finances, meaning my wife and mine.

We have one of those low-rate mortgages, but we're still paying a little bit more than the minimum because we love the idea of paying off that mortgage as soon as possible.

All right, let's move on to step three.

That's a great point.

Our goal is more to have it paid off before we retire.

We probably won't be completely there, but that not only feels better to be retired without a mortgage, but it can actually be a tax saving strategy because if you enter retirement or at some point in retirement without a mortgage, that means you don't have to withdraw as much from your IRAs and your brokerage accounts, which means you'll pay less taxes in retirement.

All right, let's move on to step three, build safety without overwhelm.

Yeah, as one of those, of course, is the emergency fund.

And I think it's always important to think about having a backup income option, right?

These days, the job market is slowing down.

Anyone who is relying on a job for income should think about

making sure they have enough money to live for three to six months in case something happens to their job.

But even retirees need an emergency fund.