Happy Monday, friends! I’ve written a guest post that’s being featured over at Frugal Rules today, called “Secrets to Helping You Get Out of Debt Quicker.” Head on over and check it out by clicking on the link. Now, onto today’s post!
I’ve written lots of posts about how spend tracking, budgeting, and generally having a plan are crucial to getting your debt paid off. But as I’ve perused the web the last six months, searching for continued wisdom on how to get out of debt, there’s one roadblock that keeps popping up over and over that is keeping people in debt. Is that what’s keeping you in debt?
The roadblock is: Refusal to face the truth. Denial. There – I’ve said it. I’m going to try and be as compassionate as I can here, while still being honest. If this post is for you, you’ll know it in your heart. Is denial keeping you in debt?
Truth about money and spending comes in many forms:
1. I don’t have that much debt. Or, I’m not really that overweight. Or, I don’t drink too much. Or whatever your vice is. Average Joe talked about this in his post, Freedom: Bad food, Bad Choices. We are free to do as we please, for the most part, on this earth. But the truth is that there are consequences to our actions. Not controlling your weight, or choosing to eat only processed/junk foods, can lead to diabetes, high blood pressure, heart disease and a myriad of other issues. You can say that those health issues aren’t caused by the extra weight you’re carrying around, or by the bad food choices you’re making, but the truth is still the truth, no matter how much you deny it.
The same goes for your money situation. No matter how “normal” it is, or how much less debt you have than the guy next to you, the fact of the matter is that your debt is keeping you in bondage to your credit card company, loan shark, or mortgage bank. Your house is not truly yours if you have a mortgage on it, and your time is not truly yours if you are forced to work a job you hate because you are handcuffed to your different loan companies.
2. I am managing my debt just fine / my debt situation is not my fault. That may be true, but one wrong move, and your house of cards could tumble down at any moment. Is it really fair of you to keep your debt load and your minimum payment schedule, especially when you’ve got a family? Is it fair to the kids when you lose your house because you lost a job? It’s not your fault? Really? Let me ask you a question: If you had spent the last 15 years managing your money wisely, budgeting, saving and avoiding debt, and tracking your spending, how much cash on hand and how much debt would you have right now? Go back and add up the last 15 years of your tax returns. How much money has come into your hands in that time period, and what would your money situation look like today if you’d saved 10% of that money and used extra cash to pay off your mortgage instead of going out to eat, to the movies or on spendy clothes for the last 15 years? Oh, you haven’t spent that much? I challenge you to go back and track your spending for the last year and add up what you spent on entertainment, clothing, groceries and the like. Seriously: be honest with yourself – how much more did you spend than you thought you were spending?
3. It really doesn’t matter what my debt situation is. It does if you have to find a new home because you lost yours. It does if a job loss means you can’t feed your kids or pay the electric bill. And it does every time you have to say “no” to something because of money, have a fight with your spouse because of money, or turn down a great opportunity because you can’t afford it. Yes, your debt really does matter if it’s keeping you from living a peaceful life.
4. I deserve to spend money. This is a lie that media and advertising have used to dupe the unassuming public into believing so that they can make money. Don’t you deserve peace and financial security more? Don’t your spouse and your children deserve those things? And honestly, is that trip to the fancy restaurant, or that new pair of jeans, or that new gadget really, truly making you happy? I seriously doubt it. You deserve SO much more than “stuff”. You deserve a life where you can make decisions based on what’s best for you and/or your family, not based on whether or not you’ll be able to pay the bills each month.
5. I don’t spend that much / I only spend on necessities. Spend-tracking was our wake-up call to face the facts regarding this particular path of denial. We went back and wrote down every dime we’d spent in the previous year on groceries, gas and entertainment. And I would challenge you to do the same. We thought we were being frugal, but the numbers can’t lie. Writing down what you spend will show you where those financial leaks are.
Regarding necessities, I plead with you to get back to basics. Kids’ activities are not necessities. Smartphones are not necessities. Nor are takeout meals, restaurant meals or other forms of entertainment. Or name brand/new clothing. Is it difficult to give up these things? Yes. Telling our kids “no” to things they want to do or have has been one of the most difficult parts of our decision to control our spending so that we can get out of debt.
But we know that, in the end, it will be worth it. When we get to debt free, we are putting our family in a place where:
a. our kids won’t have to worry about the burden of supporting us financially
b. we can do things like take vacations, go out to eat, or buy things for the kids in a way where it won’t even touch us financially
c. we’re putting ourselves in a position where we can make big family decisions not based on our debt situation, but based on what’s best for our family
I plead with you, friends, to kick denial to the curb, and to wake up and face the truth about your money and your spending. The road to get to debt free will indeed be difficult, but the life of freedom you’ll experience when you’re done will, from what everyone tells me, be worth every minute of sacrifice it takes to get there.
Are you strong enough to make the journey? Which pain will you choose? The short-term pain of making the necessary sacrifices to get out of debt, or the long-term pain of being in bondage to debt for the rest of your life?