Reply to S/O How to be comfortable with debt

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[quote=Anonymous][quote=Anonymous][quote]I do that, we probably have 20K in debt right now. However all of it is on no-interest cards. We keep it there until it is close to the interest free card offer expiring. We have savings, so we can pay it off with one stroke of a check. I'd rather have CC debt and significant savings if one of us were to get laid off, that is why we run the cards as long as we can on the 0%. We have done this for years and luckily we have never had to face a lay off. [/quote]

Or, and here's a radical notion, you could get rid of the debt and not accumulate any more of it.  I know, crazy.  That fact that you think you are somehow financially prudent by floating $20k between no-interest cards is a testimony to the power of self-delusion.  You are not a good money manager.  You are, in fact, a bad money manager.  Don't touch your savings, since that seems important to you, but pay off the debt through earnings, and live within your means.  Then, if one of you suffers a layoff, you'll have the savings AND be debt-free.  Isn't that preferable?  [/quote]

How much savings must I have?  We already have 50K in cash and at least another 340K in stocks...this excludes 401K and college savings.  We never keep more than 50K in cash and just keep moving the excess into stocks.  In all honesty, we could probably live 3 years very comfortably unemployed by cashing out the stocks. 20-30K in interest free debt is a drop in the bucket.  Furthermore, our CASH and stocks actually make money, so in our case the interest free debt is financially prudent. On stocks alone we have been averaging 10% over the last 2 years.[/quote]

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