Being born just an hour from Independence Day, I'd like to think I have a strong drive to live a free life. Going to school we were taught the horrid truth of slavery between nations. I would think to myself, "WOW, I am so glad I didn't have to live through that!" Then the thought years later occurred to me. I AM A SLAVE. I walked into the perfect trap set up by the system that runs our country. There are many forms of slavery and in this situation it is financial slavery.
Here is the Typical Trap
We go to school to get good grades to go to a great college to get a great career. Along the way, we find that we "need" a car and get ourselves a lovely little car payment. Then we get our school loans, but that's OK because we have 5 years before we have to start paying on them and we are sure we'll be rolling in the dough by that time. Some of us even decide that we aren't going to work so we can really focus on school. That's OK because we can just roll those expenses into the school loan. Somewhere along the road we find ourselves in love. We want a big white wedding. Uh oh....the parents aren't fronting the bill? That's OK, we can charge some of the items. Now it's time for a home with a cute little mortgage and how 'bout starting a family in a few years? That'll do the trick. Then how about a few vacations to "get away from it all". Or perhaps we feel so trapped or depressed we end up spending more money just trying to feel good. So, with this typical plan we find ourself with an auto loan, a couple credit cards, a mortgage, some student loans and heaven forbid we have any medical bills. It can take a lifetime to pay it off and ya know, that's exactly what they want you to do. ;)
Debt = Slavery
I was financially dumb. I learned the hard way. I definitely won't put my kids in that state of ignorance. Why is it that personal finance is not mandatory in our public school system? Simply because there is too much money to be made from people who are financially ignorant. It's time to take our finances into our own hands, because credit card debt is another form of slavery. Ignorance is not bliss, never has been, never will be.
My Story With Debt
I have personally experienced financial distress. I started feeling "grown up" with my very first credit card at 18 when I started college. My first year, I received 2 credit cards and a car loan. Over the next few years I had accumulated over 13 credit cards and 2 private loans. At the time I was an exotic dancer and felt that I could pay off each card at any time. Well, not much later I was pregnant and no longer able to continue dancing. So I went from about $13,ooo (over 12 years ago) a month to NOTHING. If I was smart I really could have put that money to good use rather than blowing it on who knows what. I stopped paying on all my credit cards and boy was I in a mess for about 10 years. Now I am out of the bad credit zone, but have accumulated some debt. It's amazing how just a small amount of debt can wear at one. It's like a little itch that you just can't get rid of.
Debt & Spirituality
As Wayne Dyer says,"Debt is decidedly unspiritual" and I couldn't agree more. It blocks the connection to spirit. Perhaps it has something to do with tension and tightening the DNA (as discussed in a previous blog: Science of Miracles) which closes us off to miracles.
Here is a documentary on financial slavery called "Maxed Out". Hope you enjoy it.
Now if you are still thinking about credit card debt. Read this article that I just received today.
New Credit Card Laws = Consumers getting screwed (again)!
Americans with the best credit may be hurt the most as the first phase of a credit-card reform bill takes effect tomorrow. Lenders are raising rates across the board, The market has changed so much in the past six months that many consumers shopping around for new cards will have trouble finding a better deal,. You may be better off holding onto your cards until the market settles down.
Rates are about 20 percent higher than in December with the lowest median rate at 11.99% now, compared with 9.99% in December. Another stab in the consumers back is that those who choose to reject a rate increase within 45 days will have two options at the banks discretion -- to pay off the balance in five years, or double the current minimum payment!
Banks have been raising rates on consumers at the same time that their own borrowing costs are decreasing, giving them bigger marginal lending rates and more profits, is all this part of that "spreading the wealth around"?
Credit will continue to be less available, borrowing limits will be lower and consumers will pay more. In addition, there will be more annual fees, higher fees for balance transfers and cash advances, and pared- back rewards programs. They (the credit card companies) are lowering limits and closing accounts to reduce their long-term risks.
Banks have already implemented parts of the credit card law and some of the major lenders have dropped "universal default", the practice of raising interest rates based on a missed payment with another company and have stopped double-cycle billing where lenders calculate finance charges based on more than one billing cycle.
So I guess we all need to keep a weary eye on our statements and perhaps the only way to get even is to stop doing business with those companies that are the worst. Even at the cost of lowering our credit scores!
Sad affair is it not?
A Great Solution by Dave Ramsey
I was directed to Dave Ramsey by my friend, Dhrumil. He has so much information out there about debt and living on cash only! Listen to this great call.
Can You Scream, "I AM DEBT FREE!"?
I can't right now, but I am getting close. I have until January until my car is fully paid off. I have made the commitment that I would keep my car until I could pay cash for a new one. Aside from that I have one credit card with a balance just over $9200. Earlier this year I had 3 credit cards, but this was the highest balance. I also sold my home. My children's father was looking to buy a home and I was looking to sell mine. It just seemed that the timing was right. The cool thing is that my kids get to stay in the same home that they have lived in the past 4 1/2 years. So it was a super simple transition. Little by little I am chipping away at my debt. Pretty soon I will be looking at accumulating wealth through multiple streams of passive income. I'll post more on that another time.
For me this is about getting myself out of all the little traps that I have created and walked into. Whether it is my health, my finances, my relationships, my career or so forth. It's about breaking free and living a life without boundaries and limits. It's about discovering and living true freedom. I think I am done breastfeeding off the system if you know what I mean. ;)
Until then... cheers to all forms of freedom!