7 Lessons I learned from having debt

by - September 28, 2016

It's a shame that our culture makes it so easy to get into debt. With the popularity of credit cards and all kinds of loans, it’s not that difficult to get sucked into the debt-work-pay cycle. Ever since I’ve become debt free, I've been tempted by so many offers from buying a brand new car to getting a brand new phone. But I know better than to dance with debt especially on those two items I've mentioned above.

For these and other reasons there is more borrowing today by more people than in the past. As a result, there are also more people having debt problems. Most of us didn’t learn much – if anything at all – about borrowing money and managing debt while in school or from our parents. And as a results we give in to the temptation to borrow more....and more...and more so easily. And sadly, because of debt we are stretched to the limit – and beyond.

Here are 5 lessons I learned from having debt

Debt is like gaining weight

Accumulating debt is just like gaining weight. A little piece of cake here, a weekly pizza there, ice cream or wine and soon those kilos have piled up and the horror of it all is that they are stuck to you and impossible to get rid of.  Just because you are not going overboard with your spending it doesn't mean that you won't end up in a massive debt. It's the little purchases, that most of us don't remember, that get us into debt.

Debt is borrowing from your future 

Every time you borrow money you are, in reality, asking a future version of yourself to send money from the future back to the present.  Do you really want to spend your money paying for something you've already used up and don't get much value from any more?  The wise use of debt means you are not asking your future self to sacrifice unduly for your present self.

Debt keeps you from accomplishing your goals.

Monthly debt repayments limit the amount of money you have to spend on other things, not just retirement, but the trip you always wanted to take or Christmas presents for your family. The more debt you accumulate, the more your monthly payments will be and the less you have to spend on everything else.

Debt is stressful 

Debt is stressful and can actually make you sick. There’s the humiliation of realising your debt has gotten out of control. The stomach churning game of hide and seek with your creditors. The chest tightening feeling that comes with little or no cash flow. Or that moment when you realize your safety net, or savings account, is gone. Debt steals from your quality of life a little bit each month, so you don’t notice the changes until it’s too late.

Paying debt is a sacrifice

While building debt is a slow process, almost mindless process, getting out requires almost constant attention and vigilance. It's even more harder for someone who doesn’t have much money to spare. It also requires constant sacrifice. It’s hard to do that since we’re continually flooded with advertisements for goods and services we don’t really need.

Being in denial about debt is detrimental

Debt is an amazing process of self-deception.  For years, I lived in denial of my debt because I didn't want to deal with the reality of being in debt.  I just kept putting it off and just paying the minimum amount. When I think about how much I paid in interest I could cry.  But I had to talk myself out of it and face the truth. If you allow yourself to continue being in denial about debt for too long, you are making your problem worse.

Debt will make you a slave 

The longer you hold on to debt, the more interest you end up paying. Interest never sleeps, and will be your constant companion until the debt is paid. Unless all your debt is interest-free, then you’re making your creditors rich instead of using that money to achieve your own financial goals.

I learned my lessons and I'm never going back.

What about you, do you have lessons you have learned from debt? What are they?

Are you still paying off debt? What's your gripe with it?

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