Debt Is A Trap

1757?  The date is now one of the most significant dates to me when I think of credit and debt.  Benjamin Franklin wrote “A Way To Wealth” .  This essay which is approximately 5 pages, made me feel like I had made so many stupid choices for the lack of education, that I felt ill for a minute.  Mr. Franklin speaks of debt, creditors, living within our means….. and so much of what he said is perfectly applicable and true to life today.

Credit card debt is huge in the U.S.  The total credit card debt is estimated in the U.S. to be $909,000,000,000. That’s billion folks.  I do have good news though, its going down.  But is it for you?  I have written a few times regarding the mistakes I made with credit cards and the horrible spiral it took me down.  In the beginning, credit cards were a bit of security and freedom of spending for me.  After a while it became a normal activity to get what I want regardless of when I could pay it off, charge it!  Then, as my 12 month no interests wore out and transfer balances began to cost more to do, then disappeared entirely I found myself in a position that I was paying late, racking up fees and higher interest rates and wasn’t sure what to do.  My financial life crashed, hard.  In recovery now, but it was my own ignorance and choice that placed me there.  Now, I find that I cannot blame society for my choices, because way back in 1757, a well meaning scholar tried to educate us on this very thing and we chose not to listen.

If you own a credit card, you do not want to be wealthy.  How easy is it to get a rate of return today of 22%, or 18, or 15 or even 9.75 on your money.  I can tell you.  Pay off your cards.  We know that our minimum payments are not designed to pay the debt off.  We also on average will charge more than we pay, or we wouldn’t have debt.  Now, as the company tacks on the interest and your minimum payments don’t bring your balance down, you actually begin to pay interest on interest which raises your rate to an alarming factor.  Sick yet?

Today, cut the card up.  Do not close the account but begin to pay it off.  I made that mistake and damaged my credit further.  Even though you are resolving to never charge on the account again, leave the account active.  You are protecting your credit score.  A closed account with a balance is viewed in an entirely different light to other creditors.  If you are in the situation where you are not able to meet your obligations, contact the creditors immediately.  The number is on the card and I bet its not far from your reach right now.  Call them now and negotiate a way to get caught up so that you can begin to eliminate the debt.  Creditors can be rude at times but they are in the business of making money and they are well aware that the longer the debt goes unpaid the likelihood it will be paid gets smaller and smaller.  If you are living off of your cards, I am sorry that it is a difficult path you will be traveling, but seek advice from your bank, and begin living within your income.  It is never impossible to accomplish and if you are in such a dire financial situation, choosing to do it now is going to be better than when you are forced to in the near future.  Trust me, I went the latter route.

I cannot stress enough how important your choices today are going to effect your future financial health.  Please, I implore you do this today.  It is with these steps that you will begin to enjoy life and reduce your stress.  e