Credit Card Crisis
Nearly everyone carries a credit card these days. In
fact, it is estimated that the average household carries 13 payment cards,
including credit cards, store cards, gas cards, and debit cards! The average
household also carries around $8000 of debt on those cards with an interest of
over 18%.
Did you know that even if they stop charging on those
credit cards today and only pay the minimum payment on those cards it will
take them over 25 years to pay off that debt and they will have paid more than
$24,000 in interest payments?
Have your attention now? I hope so. Credit card debt is
rising and epidemic proportions and is getting out of control for many
families causing undo stress, access work to pay the bills, bankruptcy,
divorce, and even death. So why do we do it? A few of several reasons include:
Wanting better than what we have – We’ve all seen
the commercials telling us that we deserve the best, we deserve better, we
deserve a break today… Society tells us that we have to have the newest, the
biggest, the shiniest, the tastiest, the freshest, and the most expensive
[insert over-priced commodity here] out there. And we fall for it every time.
What we have isn’t good enough and if we could just get a [insert over-priced
commodity here] then our lives would be complete and we would be happy.
Wanting more than what we need – We all work hard,
right? We go to work, come home, take care of our kids, water the plants, feed
the cat, and mow the lawn. We have responsibilities. We need a few pleasures
in life. We need to drive home from work in style so we go out and buy the
$5000 dollar stereo for our car. Or, since we have to mow the lawn, we buy the
top-of-the-line John Deere riding mover with the 48” deck; what does it matter
that we only have a ¼ of an acre, this is about comfort and convenience. What
about the three trips to Starbucks for that Mocca-Latte-Cappa-Foo-Foo
‘coffee’. Yeah, we need that.
Wanting it right
now –
Sometimes there are legitimate needs and desires that we would really like to
fulfill, such as being able to take the family to Disney World for a week and
stay in one of the on-site resorts. Sounds like fun, I’m sure you’ll have a
blast. Be sure to ride Pirates of the Caribbean for me. However, you can take
that $5000 trip now, charge it to your Visa or MasterCard and receive monthly
reminders of it for the next 20 years or you could save $100 a month for the
next 4 years, pay cash for everything, and have some money left over for
monogrammed Mickey Mouse ears for the family.
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