When I first wrote Zero Debt, I described credit card bills as the most heinous financial plague afflicting Americans. That was more than five years ago. Since that time, the debt crisis in the United States has worsened dramatically – and chances are, you’re caught up in it.
- Do you worry or feel stressed out about your bills?
- Are you living paycheck to paycheck?
- Do you ever argue with your spouse or family members about money?
- Have you been forced to put off certain dreams – like buying a home, saving for retirement or launching a business – just because you can’t afford to save for these goals?
- Would you like to have more money in the bank each month, instead of turning over your hard-earned cash to creditors?
- Is it difficult for you to stick to a budget and juggle today’s financial responsibilities, let alone set aside money for the future?
If any of these scenarios sound familiar, you’re not alone. Two out of three Americans with credit cards don’t pay off their balances in full each month. The sad truth is: they can’t afford to. If you’re one of these people, you likely owe nearly $10,000 on your credit cards, which is the average credit card debt in America, according to Cardweb.com.
Some of you are just trying to make ends meet, charging basics like groceries, gas and medical bills. Others of you whip out your Visa or MasterCard to satisfy your every whim, from designer handbags and fancy clothes to home furnishings and exotic vacations. I’m not passing judgment on what you choose to buy. But I am pointing out that no matter what you’re purchasing, the result is destined to be the same: if you’re constantly using credit cards to finance your lifestyle, you’re setting yourself up for long-term economic failure. It may not hit you this month, or even this year. But sooner or later, you’re going to hit rock bottom. You may not even see it coming. Yet some unexpected setback will happen – like getting laid off from your job, or going through a divorce – and all of a sudden, your debts will feel completely overwhelming. Think you have problems now? Well, that’s nothing compared to what’s in store if you allow your debt to continue spiraling out of control. That’s when the fretting and sleepless nights really begin. Nasty debt collectors will start calling you at all hours of the day and night. Your credit rating will suffer due to missed payments. And you’ll dread opening your mail because you can’t stomach the thought of facing yet another bill.
Unfortunately, ignoring the problem won’t make it go away. Refusing to deal with your debts only causes you to keep living paycheck to paycheck.