Skip to main content

Earn It or Pay It – You Choose

I love cruises, but I avoid any port excursions where small boats are involved. I am not afraid of sinking; I am afraid of getting sick. I did that once, and it was not fun. But the thought of a sinking boat is a perfect analogy for why debt is bad. Stick with me, here. 

Let’s say you are in a small boat that is taking on water because there is a large hole beneath the water line. You have a bucket and are bailing as fast as you can, but your boat continues to sink because you have not plugged the hole. Even if you can toss out water at the same rate more water is pouring in, you will never be done. You are fighting a losing battle and are likely to become exhausted, frustrated, and disheartened.

Interest on debt will create the same affect on your budgets as does a hole in your boat. If you are trying to create financial stability while still paying interest it is next to IMPOSSIBLE to actually achieve that goal because you have interest hanging over you that never sleeps, never rests, and never goes away.  It just keeps accruing. As you try to pay it down, it is still piling up. You are now spending a great deal of your hard-earned money that could be used to support your family (or even do something special) paying interest on previous purchases.

While it is very popular, acceptable, and even seems to be normal to have a lot of debt, it is NOT in anyone’s best interest, no pun intended. Until about three generations ago, debt was viewed as a disgrace. Your grandparents and great-grandparents saved for things they needed, paid cash for almost everything, and would be ashamed of the way we’ve been spending now.

Albert Einstein once said, “Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn't … pays it.” The only way to truly have financial stability is to put this principle into action and stop paying interest. To do this, you must STOP BORROWING. Most people don’t realize the most popular method of borrowing money is a credit card. Credit cards should not be confused with a debit card; they are not the same. To get in control of your money, you must STOP USING CREDIT CARDS IMMEDIATELY.

So, get out your scissors and have them ready for next week’s post, but don’t do anything rash yet. However, it is time for an intervention.

Comments

Post a Comment

Popular posts from this blog

One More–Christmas Experiences Part II

Christmas is just a week away. Hopefully you’ve checked everything off your to-do list and can spend some quality time “experiencing” Christmas gifts with your family. Because, after all, your loved ones will be far more touched by how you made them feel than they will be with what you gave them. This week, I want to share with you my sister, Carey’s, family Christmas experience. “One Christmas, when my boys, now 18, 23 and 28, were little, we gave them an experience that is still talked about now. And it’s something so easily replicated that any family can do it, and it’s not too late to do it for Christmas (even ON Christmas) this year. We drove around our neighborhood and looked at all the homes decorated for the holiday. We took note of the addresses as we numbered them. We talked about what made each ornamented yards stand out. And at the end of the night, we voted for our favorite. I had my sons help me make some of our favorite holiday desserts and, in addition to taking p...
Post a Comment
Read more

It Happens Like That

And, in what seems like the blink of an eye, Memorial Day is over, school is out (or almost out), and my favorite time of the year is here! I love summer. I love it when the sun comes up early and wakes me. I love flip flops and shorts. I like to be warm (ok, not HOT, but warm). This is when I thrive. And I think it’s an excellent time to take a vacation or road trip. That being said, I plan a long time in advance for a vacation because I won’t finance one–and I’ve taken some pretty amazing vacations! I don’t usually just take off on last-minute road trips, either, but I’m learning to be more flexible in my old age. So I have done that on occasion, too.  Now, this blog post isn’t about the last-minute drives I’ve engaged, cruises I’ve embarked, or the countries I’ve explored (being a debt-free, self-employed, budget-loving, young, empty-nester has its perks!). This post is about getting you to a point where you, too, can take vacations without stressing about paying for it late...
Post a Comment
Read more

Know Your Limits

When I was 17, I drove a 73 Nova. It used to be really easy to do things like changing taillights myself. That is no longer the case. If I tried that on my later-model vehicle (which is more like a computer than a car), I’d do more damage than good, because there are some thing you should just not do yourself. It will cost you more in the long run. That being said, there are probably some things that you usually pay someone else to do that are not getting done right now. My advice is to just be patient; depending on what it is and your skill level, it might end up costing you more to fix your mistakes. Let’s discuss some of those… Obviously, most if not all car repairs are just better done by a licensed, trained professional, including oil changes. They can also correctly dispose of used petroleum products. Depending on your tax filing status, a professional can help you avoid overpaying the IRS. I remember cutting my daughter’s hair when she was little, and I made a me...
Post a Comment
Read more