CA renter, I don’t agree that the most successful people avoid debt at all costs. I know a lot of very successful 1%ers and they took intelligent, calculated leveraged risks. They are that successful because they analyzed the risks, but were willing to take them and chose wisely. They possessed the skills to start businesses, or invest their hard earned money. They don’t take risks in areas they have no understanding of, but no one has a magic ball, so they take risks. And living at home to go to HBS or Stanford for their MBAs weren’t options, so they borrowed money.
I also know many moderately well off, debt free folks who take no risks, but they are not financially independent, meaning they will have to work at least until 60 or 65 to maintain their lifestyle in retirement. Should adversity strike, illness or loss of job, they might lose most of what they have.
The point is, there are people we can find that fit both the scenarios weve described but ultimately its about everyone’s personal tolerance for risk coupled with the ability to recognize whether you (not you personally, just the you in general) have the smarts / savvy to take them on, or whether in over your head and headed for financial disaster.
I hope to have the balls to take more risks as I personally don’t want to be a slave to the man. I’m currently taking the move towards working independently, but I also know I might have to go back to being a slave to the man. But each person is different as to what allows them to sleep at night.
