Cash flow can be more important than debt reduction
My wife and I talk about finances on a fairly regular basis. Recently during one of our conversations, we discussed the pros and cons of paying off a particular debt versus placing the earmarked money in our savings account. My wife was of the mind that we needed to pay off that debt immediately, however, I was concerned that paying off the debt might leave us in a precarious situation as far as our cash flow – the title of this post probably indicates who won that argument. My point is that paying off debt is a good thing and can almost be a bit of a rush. However, if you pay off a debt, but leave yourself with no surplus cash flow, no emergency fund or limited savings, you could be in worse trouble when unexpected expenses pop up.
