Resolutions Revisited

If the statistics are correct, then, by the time you’re reading this, you’re halfway through a bowl of ice cream wondering what happened to your vow to lose weight. You’ve only gotten four pages into that great American novel you swore you’d read. And, there’s still a pile of wood where you promised your wife a handmade bookshelf using your brand-new power tools.

Although it’s easy to forgive yourself for failing to stick to your New Year’s resolutions, unfortunately this is also the time of year when most of us are reminded of a shortcoming that is bigger and much more difficult to dismiss: cash. By now, most of us have received the first credit card statement of the new year. And, suddenly and unceremoniously, the holiday season is officially over.

The average American household has a combined credit card balance of nearly $10,000. The truly disheartening part of that statistic comes with the realization that, depending on the interest rates, that household can spend around $2,000 each year on the finance charges alone. Forget about losing your pocket change in the couch cushions - that payment is the equivalent of losing five dollars a day, every single day of the year.

Well, I’ll be the last person to say anything about the ice cream you’re eating, but, if you are one of the people who fit this fiscally problematic profile, I am going to suggest that you need to make a change.

Credit spending is as addictive as any drug. However, it doesn’t garner the same sort of social awareness and action as crack or even cigarettes. Try taking the credit cards out of your wallet or purse for a while and see if you can live without the high that comes from wielding impromptu purchasing power.

I know what you’re thinking…“I don’t need my credit cards, I just use them for the convenience.” Or, “I don’t have a problem - I just haven’t paid down the balance in a while.” Or, “I just had a bad month, but I’m fine.” Step back for a second. Those arguments don’t work for alcoholics and drug addicts, and they don’t work here either. The truth is this: if you’ve got a balance at the end of the month, any balance, then you’re throwing money out the window, and that can be a problem.

Fortunately, the solution is simple. It’s not easy, but it’s simple. Stop spending tomorrow’s money today. As a society we’ve become accustomed to borrowing against our own future. We want, so we buy. We’re hooked on instant gratification and we’ve convinced ourselves that our ability to borrow validates our desire to spend.

For some, the problem is compounded by the desire to live above one’s means. But, for most, it boils down to a lack of respect for proper financial planning. When my wife and I were first married, the mountains of bills were unavoidable: two sets of college loans, several credit cards, car payments, etc. Despite this massive debt, however, my wife and I were not even comfortable discussing the issue.

Make no mistake about it - both of us knew we were heavily in debt and that we were probably wasting money by not paying enough toward the right bills. But, talking about savings and spending seemed like such a pessimistic and fatalistic topic that we held tight to the premise that “ignorance is bliss.” There is a certain sense of shame that comes with the admission that you owe money. And, in many families, discussion of personal finance is as taboo a topic as sex and drugs.

Luckily, my wife and I conquered our pride and decided to address the issue. And, yes, the sacrifices we made at first seemed rough. But, once we started down the path, it was amazing to see how quickly the bills began to disappear. If you pay off one credit card, all of the sudden, it’s easier to pay off the next. Once those bills dried up, the car payments became easy. And, when we finally whittled everything down, we discovered that day-to-day purchases were a piece of cake.

However, the first step is definitely the hardest. Re-training yourself is crucial. And, making the hard choices requires great strength of character. But, I’m here to say, for those that succeed, the freedom you will feel is incredible.

There are many ways to go about making the change. If you’re hard pressed to come up with your own methods, there are a number of credit counseling services that can help. Keep in mind, though, like trying to lose weight or quit smoking, commitment is the most critical ingredient. And, to that end, I’m begging you - get help! Get someone you trust, be they friend or family member, and share the burden of this undertaking. Talk about it. Compare your strengths and weaknesses and, most of all, frequently discuss your progress. Accomplishing any task is easier when you have someone keeping you honest and accountable.

The year is well under way. If you need to, get to a gym. If you want to, pick up a book. And, if you’re supposed to, plug in your power tools. But, even if all else fails, force yourself to make 2007 the beginning of the end of your personal debt.
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Volume 3, Issue 2, Posted 6:06 PM, 01.09.07