The Cycle of Debt

By
Eva Fleming

Did you know that the national household debt in the U.S. is a whopping 13 trillion dollars? To help you put that in perspective, keep in mind that a trillion has twelve zeroes in it! In the words of Dave Ramsey, “debt is as American as apple pie, but certainly not as sweet.” Even though most of us have it, none of us really want it. I had a debt from a hospital stay that took me two years to pay off. And this is after decent medical coverage!

Some of our debt is the result of unexpected expenses that end up on our credit cards because we didn’t plan for them in our emergency fund. But other debt is the result of our wants and desires and things we just had to have, but never actually made provisions for in our budget.

If we want to break free from debt, we must learn to make the distinction between those two types of unbudgeted expenses and learn to plan for them seriously. One requires that we put effort into beefing up our emergency fund and the other one requires that we become more disciplined with our budget.

Emergencies are part of life. If you think your life will be smooth sailing without any setbacks, e.g., leaking roof or car repairs, then you are living in a fantasy world.

I live in Florida, where hurricane season starts in June and doesn’t end until November 30th. To survive those months, residents must have a contingency plan that answers questions like: What are we going to do in the event of a hurricane? Where are we going to evacuate if the storm is expected to be a category 5? What do I need to have in hand if I decide to stay home (water bottles, water for flushing the toilet, generators, candles, medicine, batteries, can foods, etc.), When are we going to install the shutters? What will I do with my pet? It’s important to plan every minor detail to keep the family safe and minimize any harm to the house or personal possessions, etc.

There are no always hurricanes in Florida, but one must always be prepared just in case. Readiness will help you sleep in peace with the least amount of anxiety possible. This is the kind of mentality we must have to succeed financially. The more prepared you are for what’s most likely coming, the fewer chances you’ll use your credit cards to get you out of trouble when those things do happen.

We must also keep in mind that the human spirit with all its wants and desires is nearly impossible to satisfy. In the mall I frequent, there are big signs everywhere that read: “Desire It,” “Deserve it,” “Acquire it.” All these signs invite you to satiate your desires even if it is beyond your means to do so because after all, you “deserve it.” In a world like that, without a budget and the willingness to stick to it, you are not going to be very successful staying out of debt. Here's a budget sheet that can help you get started.

If you are amid crushing debt, seek help from the experts like Dave Ramsey among others, and follow their recommendations to pay off your current debts. Beyond that, try to develop the discipline needed to improve your emergency fund and make a firm commitment to stick to your budget and you will see how little by little, debt will no longer be an issue for you.

For our children’s sake and the future of our children’s children, let’s break the chains of debt. Let’s no longer allow our circumstances and desires to keep us slaves to debt. This new year commit to do your part to shrink those 12 zeroes from the trillion dollars that are currently strangling our economy. Let’s end our addiction to debt once and for all. Here's a helpful resource that can help you cut expenses and avoid getting into more debt.

For more resources on budgeting and relationship building, you can follow Family Bridges on social media @familybridges.