Don’t be a slave to your debt

Headlines like this do pique my interest somewhat, as I have three cards myself. Three may not sound like many to some people, but the truth is, one is enough to easily get you into rather deep yoghurt!

Looking into this a little deeper, I learned that for the second quarter of 2024, the US carried a credit card debt of US$1.142 trillion! As I don’t have enough zeroes on my calculator to figure that out for a per person amount, I think I’ll let that one pass!

How is it here in New Zealand, I wondered? The best figure I could come up with was for the beginning of ’24. Apparently, we had a mere $6.2 billion outstanding on plastic.

I have to admit I have always thought of the term “Credit Card” to be a classic example of the noun misnomer. When you stop for a bit and think it through, it is simply another easy way to get yourself into debt.

I have had my card truly in credit a few times simply by paying, let’s say, ten dollars more than the total outstanding. So yes, next month’s statement informs me I am now $10.00 in credit. Now that’s the real thing too, not a misnomer.

Just last week I read an interesting article concerning a lady helping people get their budgets sorted. She gave some timely advice, like one piece in particular I recall: “Cut up your credit cards. You don’t need them.” Hmmm.

Now, when you find yourself barely making the monthly payments, as I have from time to time, you find out very quickly who really is in charge. The interest getting added on to your account rapidly eats away any benefits you thought you were getting from buying your item “on sale”!

It’s the same with mortgages too.

If you start missing some repayments, you will soon find out who is really the boss. And when the interest rates jump up, try pushing back with that, and you’ll soon see who is in charge.

A brief quote from the Good Book here will not go amiss: “…and the borrower is servant to the lender”. How true!

Having had both credit cards and mortgages, both personal and commercial, here is my 50 cents worth of wisdom. Your debt can be manageable and serve you, or you can be a servant, a slave even, to your debt. It is never a good thing when a bank is your master and rules your life, day and night.

To illustrate, for our mortgages, both personal and commercial, we always met the repayments each month. They served us in reaching goals of property ownership.

We never had to work extra jobs, forfeit family holidays, time out, or felt robbed of the spontaneity of life.

However, our story may well be very different to yours. <>When you find yourself caught in the position of being a slave to your debt, it is usually your health and/or close relationships that will pay the price. And we start withdrawing ourselves and neglecting the very people who have been good friends in the past. Rocky road stuff, for sure!

Personally, I think that price is just too high. I don’t want to go there. I would attempt to restructure or let something less important go.

When it comes to the rocky road stuff, I’m so thankful I don’t ever have to walk alone.

Take care and God bless.

Contact Colin:This email address is being protected from spambots. You need JavaScript enabled to view it.