If we put money into retirement that could have been used to pay off debt and the market tanks there’ll be “wailing and gnashing of teeth”, but no way to change course.

We probably need to approach it asking “If our situations were to take a turn for the worse (job loss, market slide, etc), what WOULD have been the right course?” We tend to make our plans assuming that reality will cooperate with us, but that isn’t always the case.

While we MUST be prepared by way of commonsensical diversification of our financial assets, we CANNOT live in fear of circumstances out of our sphere of control.

There is wisdom in this question, just don’t get caught up in too many details.

The first is to look inwards, and ask yourself if YOU have a problem with debt. If you don’t fix the core of the problem (YOU), then no matter how much you save, you’ll be taking it out to pay off your debt.

Once you understand the stupidity of getting into so much debt in the first place, THEN attack debt on a 80/20 level, with 20% being your savings.

Once your debt is eradicated then you’re free!

Having debt = presuming future income will continue to roll in, and that in and of itself is a risk.

One reason I do not contribute is because I am only 20% vested and it will take another 4 years to become fully vested in their match. While I will get 100% of the match in 4 years, right now – as Paul said – the laser guided focus of debt reduction is my highest priority.

In most circumstances, though not all of course, mortgage debt will be relatively low and quite beatable by the average yields from mutual funds over the life of the investment. So… my advice would be to invest about 15% of what you make and continue to use the rest for accelerated payment on the mortgage debt to get rid of it ASAP.

I look at my own situation and I don’t regret anything I have done. I have managed to reduce my debt to just my student loan which will be eliminated this year. We have paid off two cars and managed to save over $50,000 in retirement investments before we are 30. Compound interest is working in our favor and the more you save earlier in life the more that money can work for you in the future.

I think if you can set yourself up to pay off your debt in a reasonable amount of time and balance that with contributions to your retirement you will be well on your way to success. If you have massive amounts of unsecured credit card debt you should certainly work on that before you make big commitments to your retirement but balance is key.