by Brad Hoffer
Succeeding in budgeting, spending less than you are making, carrying no credit card debt, all of these things are a mind-set. A mind-set that says, this is what we 'will do' and this is what we 'won't do'. For years, I fell into the trap of believing that I was somehow beating the system with 0% credit card offers and then juggling the debt from card to card in order to quote / un-quote, "accomplish our goals".
The problem with credit card debt, even at zero percent, is it sucks the fun out of whatever it is you bought. Every time you use your new TV, new computer, put on your new clothes, you have the stress of knowing you still owe hundreds of dollars on your credit card bill. Hundreds, that you don't have. You do the math to see if you can pay it off before the high interest rate 'kicks-in'. Each month you make a payment and each month, those things that you bought are no longer new, in fact, they are getting old. What's worse, if an unexpected expense hits (i.e. stove breaks) you suddenly are in over your head. You cannot afford to buy the stove and you must use a credit card. Now you have just made your situation much worse. You start looking at what the interest rate will become, start looking for other areas of income and where you can cut-back. This is what I call, "the Credit Card Prison", because there is no easy way out, it just takes time, painstakingly slow, time.
This is no way to live. What did you gain? If you save up your money, then make the same purchases, you might have to wait longer, even a year, but in the end, your life is so much fuller. And if what you want is technology, you will always be better off waiting. It will be cheaper and/or there will probably be something better.
So why do we fall for this lie. I remember getting 0% offers and believing it was free money. The truth is, it is not money, it is debt, it is bad-debt. There are situations where it is unavoidable, but as far as you have the ability to avoid credit card debt, you need to avoid it. Your stress, your peace, your happiness will all be improved if you can live without it.
Today, my wife and I do use a credit card, but we pay it off in full every month. We have the mantra, 'never again'. What we mean is, we will use all our power to ensure we will never carry credit card debt again. This is what I call a mind-set. We have set our minds, we have agreed upon a common goal and it influences our conversations and our decisions. This is a powerful way to truly gain control, to guard yourself against the debt trap.
Now when I see a 0% offer, I smile, shred the junk mail and move on with my day in freedom.
I have been an Auditor, Analyst, Accounting Manager, Business Systems Manager, Controller, School Board Vice President, Director of Finance and CFO over the past 19 years of work experience. In my free time I developed the XLYourFinances spreadsheet and website I enjoy golf and spending time with my family. We attend church at LCBC.