Thoughts on Debt

These days I think that everyone is becoming more conscious about how they are spending their money.  The companies who have the necessity items and have them for less are about the only one’s that are profiting, as a matter of fact, it seems that overall most companies are really hurting and reports show that we are not buying anything extra these days.  This includes items like clothing, jewelry, electronics and so forth.  We are instead, looking for new and better ways to hang on to our money, and miscellaneous spending is becoming a thing of the past.  There are some very simple ways to go about saving some money, and so here are just a few of the ways that cutting back a little can save you a lot in the long run:

1. Make coffee at home rather than buy it every day. You’ll save about $2 a day or $40 a month. This is $480 a year, and that can be money in the bank.  Depending on where you go, it could be a lot more. 

2. Bring in lunch from home instead of buying it. You’ll end up with at least $5 - $7 dollars a day in your pocket.  That is a $25 per week savings at least, and a savings of $1300 per year.  Now that would make a nice vacation don’t you think?

3. Stop getting delivery of magazines and newspapers at home. Most of the content is available online and you can read it everyday—for free!

4. Shop around for credit card interest rates and consolidate credit cards, if you keep a balance.

5. Use cash or debit cards instead of credit cards and incurring interest charges.  Not only will this save you more money on the interest charges, but you will also be more aware of what you are spending your money on, and how fast it goes.

6. Save your stamps and pay bills online, usually for free.  Most companies will allow you to make payments right on their web site, either using a check or debit card, and most banks offer online bill pay services for nothing as well.  This is a very convenient way to pay your bills, and you can also put them on automatic payment, which is great because this way your bills will get paid on time, without missing payments and accruing late charges.

These days every little bit of savings helps.  It is nice to see the gas prices come down, but who knows when they will go back up again and grocery prices are still high.  So be sure to keep a good handle on your spending the rough economic times are not gone yet.

Well, the government has been on this band wagon for years.  They have been looking to rid themselves of the payday loan industry claiming that they are ripping people off.  Don’t get me wrong they do charge exorbitant rates on their loans, there is no doubt that this is true, however I can’t help but wonder if they really are just angry because that is money that they are losing each year, and they don’t want the competition.  Think about it, you can pay $15.00 per hundred to borrow from a payday loan place, or you can possibly bounce a check and be charged $35.00 so really is that so unreasonable.  Plus many of the people who choose to take out payday advances are people who can’t get approved for government loans with lower interest rates, so what are they really losing, if they aren’t providing services to these people.

Now many states have completely banned payday loans making them illegal, but many more states are trying not to completely do away with them, but merely limit the terms, interest rates, and number of loans a person can take out.  One such reform in the state of VA has a lot of payday loan companies scrambling to find new services to provide and new ways to get around the coming laws.  With many people paying them millions in interest every year, they are not sure how they will make it, and many people are worried because a new database will not allow you to have more than one loan at a time.  The concerns are great, but the best advice I can give to you is if you currently hold a payday loan, find out about the changes in your area, and be sure to get the facts.  It is a good idea to begin paying your loan or loans back now, so that you don’t get stuck after the first of the year.  Some companies will change the game in 2009 and others may have to close their doors completely, so be sure you get out of this system before it is too late!

Usury by definition is the loaning of money at exorbitant interest rates. This is a term that is condemned by both the Torah and the Koran, so why is it that it is our primary theme in American culture? Many people would say it is so that we can own a home, a car, and so forth, but if you think about all the debt in this country and the fact that our government is the primary benefactor of the interest we pay, there may be something to the fact that maybe we are just convinced that we need to live in debt. Look at the facts:

Credit card debt with interest rates hovering at about 24 percent used to be a crime, but since our government entered the picture, there are no real corporate crimes anymore. And as wages shrink and prices soar, American’s will use more and more credit to hang on to their “I want it now” lifestyles.

College tuition debt, the new growth area in the debt industry. In most Western nations college education is free or nearly free. This type of debt gets the youngest adults in our society started off in debt before they even can get a reasonable job. Why is it that in other countries, they can get an education for nearly nothing, but here in the US the government who runs the colleges for the most part is benefiting 2 fold from these monies. First they benefit from the money that is paid for the schooling, and then they benefit from lending you the money to go to school, how is this legal?

Medical debt, the latest twist in the health care story in America. While health care is a right and is publicly financed in most countries, in the U.S. 42 percent of Americans either have no health care coverage, or have pay-nothing private insurance scams. Again, who is getting the money we pay for medical care? Oh, that’s right it is our government.

Mortgage debt. Need that dream house, the little place with the white picket fence. No problem all you have to do is make payments of half your income to a mortgage company for 30 years. Now they have even made arrangements for poor people to get in on the act with sub prime loans and buy it now pay it later loans, this way they can be in debt like everyone else.

National debt, my favorite. A small percentage of people, through both good fortune and wise decision-making, avoid the debt trap. But not to worry, everyone pays taxes — well, everyone below a certain income. Now that is us paying off our country’s debt, well all the welfare spending money, tax breaks for the rich, and military spending money, has to come from somewhere right. Don’t worry you are paying that off and currently each one of us owes the Federal Government about $32,000 each to pay off their “deficit” which that is right comes out of our pockets too.

Thank goodness our government has us to take money from on a regular basis, otherwise they might go broke.