Consumer Debt is Out of Control, So What Are You Going To Do About It?

This article from Ken Bensinger from Smart Money, is refreshing to read knowing that other people are getting the hint that consumer debt is out of control. The part that I found most interesting is that he points out that so many Americans fall into the trap of paying off debt with more debt. The idea of refinancing a mortgage to roll debt into your mortgage or buying a HELOC to pay off credit cards or students loans is not solving the problem. Credit consolidation companies don’t solve the problem either. They help your situation, but they don’t solve your problem. If you’re swimming in debt that you can’t handle, the problem is YOU.

That stings a little doesn’t it? Am I just getting on my high horse? Am I a hypocrite? No, because I realized I had a problem mid-way through my college years when I had $20k in student loans and $10k in credit card debt. Now, I am about to pay off all of my credit card debt and I have $18k to go for the student loans. So, I know what you’re going through. You’re not alone. It’s kind of like the alcoholic that thinks no one understands him or her. Listen, I understand that money is tough to control. Credit cards are so fun, because you never see the money leave your hands. But, my point is that it is an empty road. Soon, it will catch up with you much like abusing drugs and alcohol. You can abuse money just like any other substance, but the funny thing is that the normal thing to do is abuse money. People that are considered “cheap” and “penny pinchers” are too boring and they won’t live their life. We ostracize people for being smart with money. It’s pretty ironic if you think about it.

So my question to you today is, “What are you going to do to get out of debt?” Are you ready to make the sacrifice? Are you tired of living paycheck to paycheck? Are you tired of ALWAYS having a car payment or ALWAYS carrying a credit card payment? All it takes is a little bit of getting angry and a little bit of determination. You’ll soon realize that you hate being in debt, and the path to recovery has started. Just like any AA meeting will tell you, the first step to recovery is acknowledging that you have a problem. If you have a problem with money, and you’d like to talk to someone anonymously about it, you can email me at erik(dot)folgate(at)gmail(dot)com. Just substitute the words in the parentheses for the actual symbol and don’t include the parentheses.

If you’d like a step-by-step program to getting out of debt, Check out my debt elimination plan

  • Eric

    I work for an organization that sells HELOC’s. I think they are bad ideas. They can make sense if you are using it for a better rate. Like to consolidate your credit cards from a 17% rate to a 7%. However, usually people are in debt for a reason and once those cards are free of debt, people will bad habits will just shove more debt back on them.

  • credit card for students

    I agree with you. The problem is really on the credit card users. Credit card debt is acquired because people who use it don’t know how to manage their expenses. If only you can control your spending habits, then, maybe you won’t have to face too much debt in the future.