When I said debt-free, I didn’t mean having a zero or positive net worth with assets equal or greater than debts. I meant I didn’t want to owe nothing to nobody. Positive net worth, zero debt.
I had taken on some serious debt and paid some serious interest. While chipping away at my student loan debt, I added a half-million dollar construction loan.
The math is simple. With today’s low (but climbing) interest rates, I would say carrying the mortgage wins more often than not from a probability standpoint.
From a psychological standpoint, being debt-free is a state of being that has significant value that’s much more difficult to quantify. I chose the option to be debt-free and haven’t regretted it one bit.
The other heavy debt burden carried by many of us are student loans. The payoff calculations are similar, but not identical for the high-income professional.
In the lower tax brackets, student loan interest is tax deductible. The deduction is phased out at an adjusted gross income of $70,000 to $85,000 for individuals in 2019, an income most physicians will exceed.