Debt and it's Destruction!
(What it's like to live debt free and why all debt is bad)
by: Tony Foote
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The NZ Orator...
A STORY FROM MY NEW ZEALAND EXPERIENCE
All Debt Is Bad
Live by debt - die by debt
By Tony Foote
Tip: Desire is the root of all unhappiness
Tip: Greedy gets you caught!
Tip: If you can't afford to buy it for cash - don't buy it!
- Less than 6 percent of all the monetary value in the entire global economy is actually cash money! Up to 94percent is just numbers on a computer screen!
- The world economy is entirely fueled by debt – all kinds of debt!
- If you are in debt, you ARE in trouble unless you can dump it now!
- Credit is fleeting – it vanishes along with your job and cash!
- When the world economy turns to shit – you will need that credit but won't have it!
- Cash is king!
- No income, from ANY source is guaranteed – ever!
For the longest time, I had enormous debt around my neck. No matter how I tried to clear it, I never could. There's a few basic reasons for this.
- The first one is that I always wanted more – greed. I was never satisfied with what I had and was always believing the “you must upgrade now” bullshit from retailers, friends and those “in the know”. All bullshit. I had no money so couldn't actually afford it and DIDN'T NEED ANY OF IT!
- The second reason (and I use the word reason – not excuse) was Like the rest of the world, times seemed financially good enough to me so I thought “why not – I need this, or I deserve this”. Utter bollocks! I didn't “deserve” anything more than I could afford and the fact that I had to borrow money meant the “times” were not that good economically.
- Finally, there's an expression used by a few criminals I once knew – “Greedy gets you caught”. That is so true and on so many levels. When using finance instead of cash I had earned, I borrowed to buy a motorcycle. I did not pay that right off before buying another one, also on credit, then a third. Through impatience, I got greedy and the debt mounted up quickly.
Go on, scoff at me! We've all done it. Some through desperation but most through impatience, greed or pretence! Anyway, that started a spiral which would prove to be impossible to escape!
Credit Card debt is insane! If you borrow $4000 off your credit card and pay only the minimum charge monthly, it will take you many years to pay off that $4k! Outrageous and disgusting business practice in my opinion and you will be stuck with the consequences of it, especially when you get a second credit card, borrow against it to pay for the first one. Here's a sad reality for you – when you reach that point, your debt will continue to grow, not only on those two cards, but because by then, you will have run up debt with finance companies or your bank. You will undoubtedly begin borrowing from your existing credit sources to pay the repayments on all of them.
You will spot a deal for debt consolidation – you know, just one new loan to pay off all the others with just one fucking big repayment! Whatever – by now you are in trouble up to your ass, even if it is not yet apparent because you will feel flush, and talk yourself into buying some other stuff which – wait for it – you don't have any cash to pay for. Your kids need it for school! You need it! You deserve it! Your friends all swear by it and you feel left out because it's the latest thing – There you go, a whole new cycle of debt is about to begin! Stop Now! Don't buy it!
All credit is bad. All credit cards are a disaster waiting to happen and the worst deniers are those who pay for their groceries with them, then tell everyone they pay the card off once a month. Yeah, you keep telling yourself that – it's a crock – we all know it.
So you bought a house and now have a mortgage eh! I am willing to bet you should not have committed yourself to something so big, given that all the way through life, renting, although less secure, is far more affordable! What do you mean “Bullshit!”?. It's a fact. House prices are insane and there are huge costs associated with home ownership and it's responsibilities. Your mortgage in the current climate will gobble up a huge chunk of your take home pay. If you are on a stellar salary, you are excluded from this part because the reality is that most people by far use at two thirds of their combined incomes and finance costs on the houses equity. Don't lie to me. I have been there and it is vastly more common than you think.
Hands up who bought a house, then a new car, furniture, a new boat, a new caravan, holidays around the world or a cruise or two? Now, hands down who did it with actual, unencumbered cash. None of you. Hmmm… I bet you put it on the house – you are screwed! That house you thought was going to be your nest egg for retirement is now drowning in debt! Go ahead – deny it – we all know it. Now, one of the couple who bought a house on mortgage has turned 48, has lost their high paying job and is too old to appeal to any employer. Oh Oh! The end!
I have made all these mistakes and they all end in the same place – bankruptcy… These days, I have no debt, none! I pay all bills the moment they come in and I do not use credit of any kind, so much so that could not get credit now if I tried because I don't have a credit rating due to not borrowing for decades! Cool eh. I never have to worry about making ends meet. There is no one knocking on the door to boot my ass out of the street because I lost my job and couldn't make the house payments. No asshole is trying to repossess my car because I couldn't afford to pay him to leave it.
All my trouble started with a single hire purchase which go out of hand because of impatience and greed. Learn a lesson!