“Debt: An ingenious substitute for the chain and whip of the slavedriver.” – Ambrose Bierce
That opening sentence pretty much sums up debt. It is the modern day slave driver, causing us mere mortal consumers to spend money we don’t have, to have things ahead of time in order to help us carry on with our lives (which for some reason continue to get complicated regardless of all the things we buy to help).
Today I was thinking about my own personal debt. I asked myself, “what is it about debt that I hate so much?” – yes it’s a pain to make repayments and yes I could spend the money better elsewhere, but I am in debt because I used it to buy things. In fact, the reason the debt exists is because I used it to buy something I apparently wanted or needed.
The conclusion I came to about debt is that while annoying, it is self inflicted. So what exactly causes me to hate and despise this self inflicted debt so much?
Here are four things that debts causes which we don’t anticipate and why we become slaves to debt.
Debt locks you to your job
Debt can force us to stay in a job we don’t like or hate. We will literally put up with a boss that is terrible or a job that is unfulfilling simply because we need to continue to repay our self-inflicted debt.
Considering that working 9 to 5, Monday to Friday equates to 40 hours of every week – why would we ever want to stay in a job we don’t like? The answer is because we have to.
Paying off debt will allow you to feel less stuck. Why not try and pay off your ancillary/bad debt, grow a cash stash of $3,000 to $4,000 and know that you never have to stay in a job that you hate again? That is my goal. It doesn’t mean I am saying to quit your job, but the power to know you can is pretty amazing.
Debt means your pay is accounted for before you get paid
From a motivational point of view, knowing that every dollar you earn should technically go towards paying off your debt, can be quite upsetting. You work hard for every dollar only to pay it onwards to a debt each fortnight or month.
I get so excited thinking about pay day. A chance to feel rich (for about 30 seconds) but then the reality kicks in. Nearly every dollar is accounted for (or should be) against debt, which makes my smile turn upside down.
Think about how good it will feel to know that every dollar you earn is unassigned (except for essentials) and anything left over is free to use towards whatever you want. Perhaps you could grow a big cash stash in a savings account, open a couple of term deposits or invest the money for your kids. Sky’s the limit once you are debt free.
Debt gives you short term satisfaction, long term dis-satisfaction
Another aspect that people rarely think about when buying something on credit is the longer term side effects. You might feel good for a day or two after a purchase, but the more debt you have, the more you will begin to think about it.
Imagine all the brainpower you are using to think about debts, worry about debts and scheme methods of repayments? Hell, you wouldn’t be reading this and instead might be using this 5 minutes to invest your money to make more money.
You cannot underestimate how bad debt makes you feel. It causes you years of struggle and heartache. The amount of time and energy it consumes is ridiculous.
My advice? Avoid debt for trivial things. While a house may be seen as good debt, debt for the sake of a dress, shoes or an expensive dinner really doesn’t cut it in terms of energy it consumes ongoing as a result.
Debt means you may miss out on other opportunities
If you are focused on repaying debt, you will more than certainly miss out on exciting opportunities. Perhaps it’s a business venture you want to undertake so as to quit your 9 to 5 job. With debt lingering, those choices and freedoms become limited. Similar to point one, you feel like any kind of risk is impossible, as you debt enslaves you into needing and craving security of income instead of contentment and trying new things in life.
You become a debt zombie
To be quite simple, debt makes you a slave to the mediocre.
What do you hate about debt?
Tell us why debt is annoying you. What do you hate about debt? What are you going to do once you no longer have any debt?