<I guess my good introduction have bad SEO, no Debt and Finances mentioned in the first 2 Sentences. ☺ >
Among the constellations, the Big Dipper lies glimmering in the Northern Sky of a dark cold night. The brightest stars include Alkaid, Mizar, Alioth and Megrez. Constellations make us think deeply about the World and wonder; but never as deep as your current Credit Card Debt.
Yes! The Billing on your next Credit Card makes you think deeply because it is as big as the Constellations!
What is Debt?
Before we operate on your empty pockets, it would help to know what debt is. Debt, simply stated is any “money owed to anyone for anything.” That description includes everything from the Jeepney fare you owed to your best buddy to the Indian guy who keeps you covered up-and-tip-toe in your office.
In Biblical times, failure to pay a debt to anyone is already equated to dishonesty! Well, if most of us are in those times, whole group of nations lost their character and integrity. In Proverbs, they say that the debtor is servant to the debtor. If you default on your debt, you sell yourself or your children. That is why “The wise store up treasure for their children’s children.”
Fast forward over 2,500 years. It is now the 21st Century. When in the Old times, failure to repay a debt would lead to physical bondage or slavery, today that same bondage is replaced by mental bondage.
Have you ever felt that gnawing sense of anxiety that salary day is coming but debt is overtaking you with no money to pay? Remember those nights when you can’t sleep because financially, the dark man of slavery is taking you? They are dragging you into slavery!
Why do we get into Debt?
“It is easy to get a loan, it’s difficult to pay it back.” In the old times, all payments were physical. It made money measurable, emotionally. Two silver coins means two silver coins! How much emotion is involved in signing away P1000 bill? P100,000? Just the same right?
People may blame many things including budgeting, loan sharks, capitalism and other things. But Debt is ussually just a symptom of something else that was there: Greed, Ignorance, Impatience or Self Indulgence. Debt is the reflection of your own desires gone bad. Therefore, trying hard not to stop spending is nearly impossible.
Bad Habits are deeply entrenched in our psyche. And like bad habits, bondage and slavery is an attitude.
Sources of Debt.
1. Spending Tomorrow’s Income Today.
This is one of the most common attitude of most debtors. It is a way of thinking which never plans and doesn’t take responsibility for one’s actions.
What is a Credit Card? “It is what you use today to buy what you use today to buy what you cannot afford while you are still paying for yesterday.”
Other people’s needs are also valid such as mortgage or home payments, car loans, education loans. We understand that these things are not necessarily bad. But the act of not looking forward to the future is a point of error.
2. Decrease of Earning Capacity/ Loss of Job.
Part of our own desires are the insubordinate pride to prove ourselves disastrously in comparison to our peers. We want to look better than our neighbor.
3. Increase of Family/ No. of Dependents.
The Filipino Culture has its own hand in dealing us with this problem. We are lead to believe that those that earn much are responsible to feed everyone else just because they are family. While this is a complicated matter that can not be taken lightly, it is further complicated by human psychology where the subsidized family members no longer work because of the subsidy.
I wouldn’t say that providing for parents and family is bad. I can only remark that the Bible says that “A good man leaves an inheritance for his children.” That foresight is honorable and leaves a legacy for the future generations to look forward to.
4. Accidents/ Injury.
This last is when life deals a big blow in life. We must not prepare just for the expected but even the unexpected – through insurance.
Implications of Debt.
Compounding Interest is Working Against You.
While the bankers and investors are earning their 3% interest on your loan. You are on the wrong side of the Earning Equation – you are funding these wise people’s earnings. The sad part is that these purchases are not even basic needs.
Getting Debt is Easier than Getting Out.
Debt is living in the moment. It says that you can live now and never think of the consequences.
Debt Always Mortgages the Future
When you borrow money, you are actually giving away 5, 10 or 15 years of your life. That is what debt is – slavery for the rest of your life.
Getting Debt is Easier than Getting Out.
Your over-all financial health and paying strength exponentially withers while you easily give away 5, 10 or 15 years. That is what debt is – slavery for the rest of your life.
Debt Always Robs you of Freedom of Choice.
Have a debt and you don’t have the choice of not working. Have enough debt and you lose your property and eventually your only choice is inside bars!
If you are in debt, there is hope and you can still get out. The important thing is commitment.
1. You must decide to get out!
2. Empty your savings / liquidate some assets to pay debt.
3. Repay your debt religiously. If your debt is “Ginormous”, try this principle: “It’s not your ability but your willingness to pay.”
In ending, I leave you a quote, “Yesterday is a cancelled Check, Tomorrow is a Promissory Note, Today is the Only cash you have so spend it Wisely.”
Arch Ian Jay Bantilan