Tuesday, January 20, 2015


Q.  My husband and I are over our heads in debt and don't know what to do. We both work but our income doesn't go very far. We don't want to file bankruptcy. How did we get into this mess and how can we get out of it?

A. We are the wealthiest, most affluent nation in the world yet we also lead the way in spending beyond our means. Our culture encourages spending as no other has ever done. We are offered credit card, after credit card and are encouraged to go into debt. Advertisements bombard us with sleek new cars, high powered computers, convenient and expensive cell phones with new gadgets to keep us connected and having fun.

We are buying a variety of things and more of them than our grandparents did. They shared one small closet for all their clothing. We can't find room for our clothes even with large walk in closets. Our grandparents lived before many of our "necessities" had been invented, including television, DVDs, computers, microwave ovens and cell phones - to name a few.  When prior generations did buy something they paid cash. Or they did without. Our bankruptcy rate is more than four times higher than in the depression of the 1930s. Though the gadgets we have make our life more comfortable, we haven't learned to postpone purchasing these until we have the money.

The solutions aren't easy. You and your husband will need to work out a plan and agree to stick to it. Here are some practical things you can do to get your spending in line:
1. Be satisfied with what you have. Make a budget and live on the money you have. More things don't bring happiness.
2. Understand the difference between needs and wants. We need food, shelter and clothing. We don't need designer jeans.
3. Don't watch advertisements on TV or look at them in the newspaper.
4. Shop with a list and buy only what's on the list.
5. Pay off credit cards as fast as you can to reduce the interest you’re paying. Use only the card with the lowest interest rate. Pay off the monthly balance of each card to avoid interest. Plan to eventually pay off all cards monthly so you pay no interest.
6. Cut out any costs even small costs. For example go to the bank and deposit money or cash a check instead of using the handy ATM.
7.  Don't buy when you can borrow or share. Library books are free. Share tools with a neighbor or relative. Swap baby sitting with another couple.

Learn what money means to you. Think about and talk together about how you use money. Do you buy things when you are bored or hurt or sad? Does one person spend money to get back at the other? Be honest about the way each of you use money. You may use spending in much the same way the alcoholic uses alcohol - to avoid inner pain or inner emptiness.

Do some soul searching about what money means to you. Money has too much power over many of us. The Bible warns about this repeatedly. When our focus in life is on spending and getting we miss the true meaning of life.  We're focused on ourselves. We want what we want and we're going to get it. Two year olds think this way! 

We must reach a new way of thinking in which we see how blessed we are with the things that matter: health, family, friends, and opportunities to help others. When we learn to give of ourselves we aren't so hungry to buy things.

A financial counselor can help you with this. I recommend Consumer Credit Counseling, a non profit agency that will help consolidate your debts and work out a manageable budget - or recommend bankruptcy if that’s the only way out. 

“Do not wear yourselves out to get rich; have the wisdom to show restraint.” Proverbs 23:4

Blessings, Dottie

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