Dealing with Dept
In : finance, Financial Aid, Posted by admin on Sep.09, 2011
When student loans default, house payments get passed over, the power company threatens to turn the lights out, and the credit card statements begin multiplying the amount of money you are (supposedly) going to give them back, you know there is a serious problem. Falling into dept has never been easier with modern electronic banking, but the consequences of dept are a harsh reality, and represent a pit that can be incredibly hard to climb out of.
Modern dept is insidious. Because money has now been reduced to numbers on a computer somewhere that don’t even appear on your credit or debit card when you swipe it, there is no longer any feeling of urgency when the outflow passes the inflow. Individuals no longer have a pot of gold to keep an eye on—just a bunch of little digits on a monthly sheet of paper. This devalues money, along with competitive culture that tends to emphasize personal wealth and easygoing prosperity.
So many people are surprised when the noose tightens. Credit card rates are usury, plain and simple. The amount you owe will multiply much more quickly than any savings account and this debt will bury individuals over years, especially those trying to live above the means that their employment (and employment is never a sure thing these days) can provide.
It usually takes time for desperation to kick in. And once it does there seems like little hope. Bankruptcy rates for individuals and even recent college graduates have never been higher and many dept reduction plans are secretly number’s schemes that help no one. The only solution to hard-core dept is hard core belt tightening, combined with a diligence in work and aggressive repayment plans. It’s hard and it sucks, but if you want to dig free you dig like the hole is closing up around you—desperately.