There comes a point in everyone’s life when people realize that staying out of debt is perhaps one of the very best things they can do. Normally, this day comes years after the binding relationships of a mortgage, double car payments, credit card bills and other living expenses pile up. What we think we must have and what we think we can afford are completely opposite from what we really need and what we actually can afford!
It is difficult to pin point the problem. Young couples get married and immediately feel they must have the house of their dreams. The kids come and the SUV’s are suddenly a must. The rest of the world is left driving by our houses, knowing our professions and wondering how in the world we make ends meet! A few years later the foreclosure notices are there or the ruined credit has limited our children’s choice of colleges and we realize in an aha moment that staying out of debt would have been wise! Unfortunately, like most things it is realized too late to rectify.
It is always easy to throw aside conventional wisdom and that from our elders who remembering the Great Depression, sit back and worry about our overindulgence. They tell us about the days when they made a week’s worth of dinners from potatoes because they simply want us to realize that Benjamin Franklin may have been right when he said it was better to go to bed supperless than to rise in debt! Debt, and the whole idea of owning or borrowing smothers the spirit of freedom in our lives, removes our ability to have choices and has in a constantly underlying race against time. We begin living in a world that is all about robbing Peter to pay Paul and lose sight of the things that are really important. Debt provides people and families with the deepest sense of imprisonment where they are forced to suffer alone and in private or risk humiliation and failure.
It has been said that debt is the worst form of poverty. When we owe more than we can pay or when we owe everything that we earn we live a life that is full of false pretenses and insecure feelings. With one change in the economy, with one family emergency, with one occurrence we become poorer than those who live in the slums and risk losing everything that we have or could have in the future. Bankruptcy is both a financial condition and an emotional one, both leaving people completely empty. Staying out of debt should be something that we attempt to do in earnest realizing that wants and needs are two different things and that we can always get by with less stuff.
There is also a mathematical element involved in debt. When we are in debt, our goal is zero! We want to get to a point where we owe zero dollars, where we have nothing more to pay. The sheer principle of striving for nothing seems to be a suffice explanation of why it is better to stay out of debt than it is to take the plunge into the unknown.
The very sad part is that for decades there has been tons of free financial advice. For instance, we all know that purchasing a new car, off the lot is a ridiculous investment of money. We realize that the minute we drive it out of the dealership, we have lost thousands upon thousands of dollars that we spend years making up and rarely ever do. Yet every day, millions of people trade in common sense for that new car smell. People engage in ridiculous loans that don’t even make sense to stupid people just to get the house they want and people go to malls paying full price for things they can get elsewhere at a fraction. These are the reasons we go into debt? It just doesn’t make sense. Eventually, we become numb to debt and the mounting bills and pressures destroy us at our foundation and make us nervous about what each day holds. Could today be the day we lose our job? Could today be the day our child is hospitalized? What about a car accident, a home repair that is imminent or dental issues that may arise? What about college savings, and retirements? How do we pay for Christmas or that trip to Disney that we must take each year? There is no safe place to be and each day is full of energy that is indicative of a struggle. Debt provides a revolutionary struggle within and on the outside and perpetuates angst that is not healthy or natural!
Recently, a report by the American Academy of Pediatrics said that there are over a million children in this world from middle to upper income homes who do not have health insurance and who do not qualify for government health care. There are also millions of children and adults who wait years to see the dentist because they can’t afford their portion of the treatment. There are also millions of people living in high-class neighborhoods who are putting groceries and gas on credit cards each month without paying even a fourth of the balance each month. That means that these people who live in the finest house, in truth can’t even afford to feed their family. The problem is that they don’t realize this, at least not until the bottom falls out!
It is important to create a buffer of security in life. Staying out of debt as much as possible and making common sense choices is important. Even if you build up a savings account and have to blow it on repairing a leaky roof, you can at least be grateful you had it to spend. There is always a reason to spend money, but there isn’t always a need. If each person had $5,000 in the bank, saved for a rainy day, this world would be a much happier place! Consider it for just a minute and you will see that staying out of debt is really about remaining free and gaining the understanding that realistically your needs in life are easy to meet financially; it is simply your wants that are not.