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Net Worth is King

Danielle Nava

If you’re around these parts for long, you’ll hear us talking a lot about fear. Fear is natural and, honestly, it’s necessary. But when it comes to finances, there are three types of fear: fear of the unknown, fear of change, and fear of failure.

These types of fear hold us back from investing, asking for the pay raise, or from taking chances when building a business. Fear can also make you focus on the wrong thing when it comes to your net worth. Paying down debt rather than building up your assets, to be specific. 

How do we conquer our fear? One way is to talk about it. Let’s talk about where our fear of the “debt boogeyman” comes from, a three-step strategy on how to overcome it, and what part of your finances you should be focusing on instead.

Assets – Liabilities = Net Worth

What is your “net worth,” exactly? 

Simply put, your net worth = your assets – your liabilities. 

You want a positive net worth, which is where you have more assets than liabilities. “Own more things than you owe,” as we always like to say. As simple as that sounds, we see more people focus on paying down their debt rather than building their assets. That’s partly because our culture focuses on debt so much, even though assets are just as important, if not more so. 

The Problem with Focusing on Debt

Let’s be real: our society’s obsessed with debt.

Money “gurus” say to attack debt first. Once it’s all gone, THEN you should invest. But there’s a fatal flaw in that plan: all those years you spend paying

But we keep shooting ourselves in the foot by paying down debt… because we’re scared! Where does this fear of the debt boogeyman come from? Our parents dealt with the highest interest rates ever to date in history, from the mid-1960s to the mid-1990s. Which, by the way, is the generation that Dave Ramsey comes from. We Millennials were raised to believe that we have to be debt-free before we save or invest. (Thanks, Mom and Dad.) 

Now, over the last 10 years, interest for debt is at one of the lowest it’s ever been. This means that the Baby Boomer mentality of fearing debt doesn’t really make sense anymore.

We need a new way of thinking about debt and assets.

How to Work Towards a Positive Net Worth

We’ll lead the charge on getting rid of that debt-fearing mindset. Instead of looking at debt as some horrific monster, think of it as a necessary presence instead. You can and will deal with it, but other parts of your financial strategy are more important and will make a bigger impact on your wealth. 

Think of it this way: even if you pay down your debt to zero, if you haven’t been saving until that point, you have no wealth. Zero is then your starting point, which is a waste. Choosing the right assets and focusing on saving — at any income level — is more important than paying down debt. Here’s how to do both at the same time.


We typically think of anything over 6% as high interest, like credit card debt. Get rid of it; pay off your credit card debt on a monthly basis. This is the only thing we’ll agree with Dave Ramsey on. 


This includes your mortgages or student loans, which are usually less than 6%. Make those regular payments…and stop worrying about them. You can do it.


At the same time you’re lowering your debt, you’re working toward positive net worth. 

We talk a lot about our bucket strategy, but here’s a quick recap of how it works. You have three “buckets” to put your savings towards and we recommend using all of them to build your net worth. Using this strategy, you’re putting money towards all of these goals at the same time, letting these savings grow now so you can enjoy them later.

Face Your Fears and Move Forward

Getting over your fear of debt takes time and change can be scary. However, we hope that this explanation of where this fear comes from can help you start changing your mindset. Don’t waste time chipping away at your debt only, when you can be paying it down and building your assets at the same time to achieve positive net worth.

Knowledge is power; more specifically, knowing your financial situation can help you overcome that fear. If you need help getting clear financial numbers, join our FREE Know Your Numbers email series. You’ll learn what to save, how to save it, and how to use the bucket strategy to your benefit. 

The opinions voices in this material are for general information only and are not intended to provide specific advance or recommendations for any individual.

There’s a lot of bad money advice out there.

What if you had a clear formula to help you figure out how much to save… while paying down debt and enjoying life? It is possible… when you know your numbers.
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