Twelve Steps for Debt Addiction

Americans have grown so used to overspending that for some the thought of a reduction in lifestyle because of tighter credit is driving them to irrationality. I recently heard a news report about a paralegal who decided to get back at the firm that layed him off. What did he do to get back? He stole a tie from a clothing store! He got caught and was put in jail. The moral of the story: when you fall on economic hard times, strike back at the rats that caused it by going to jail. Go figure!

Don't get me wrong, millions of Americans are deciding to abandon the sinking ship of debt poverty in order to become debt free, but for the most part the Debt Titanic is still full of passengers that think the ship will not sink. There is a gaping hole in the hull caused by the iceberg of Debt Addiction. If we do not hurry into the life boats of Living Within Our Means and Getting Out Of Debt, many will be cast into the frigid waters of bankruptcy and economic ruin.

I think we need a twelve step program to address our debt addiction. We have gamblers anonymous, narcotics anonymous, and alcoholics anonymous. Why not have Debtors Anonymous? This is serious. When you consider the enormous amounts of debt many have beyond their mortgages, it is scary. Until recently, I myself was in over $40,000 of credit card debt. I've heard true stories of others in twice as much as that. I certainly needed something that would give me some hope, and because I found it, I now am debt free except the mortgage on my home. Did I find a twelve step program? Well, sorta I guess. More about that next time.

Taking Responsibility

Now that I have ranted about the current state of the economy, let's talk about how to escape debt poverty. Well, maybe I should define debt poverty first. Debt poverty is the economic condition experienced by many Americans in which their total debt payment leaves them with little or nothing left over for basic expenses. This results in the use of more debt to finance basic expenses causing a debt spiral leading to what feels like imprisonment.

Can you feel the frustration? Is this a description of your situation? Don't despair, there is hope. There are no easy fixes, but there is a way of escape. If you recognize that you are in need of help to get out of the mess you are in, you have begun to break the chains that bind you.

Once you have the knot in your stomach that all is not peachy creamy, then you should take an account of what your real situation is. It's time to face your dilemma head on. Pull out all of your debt statements and add up the total amount of debt. Then, find out how much you pay each month in debt payments. Hopefully, once you see this, you will get motivated to make changes.

You need to include your car payment(s), credit card payment(s), school loan payment(s), mortgage payment(s), and any other payments you make that are credit related. Be sure that you leave nothing out. It is important to be totally honest with yourself and/or with your spouse, and visa versa. Nothing is more frustrating and damaging to recovering from your debt addiction than not being honest.

You must complete this exercise before you can escape debt poverty. Ignorance of one's economic status is a sure way to financial ruin. Deliverance from the tyranny of debt begins with taking responsibility for your financial actions. This may be one of the toughest parts of escaping debt poverty. Those who face the problem will win; those that do not won't.

Enough Is Enough

Ford, GM, Chrysler--no matter what you call it, they are still asking for a bailout. No doubt they are going to get it. My problem with it is not that they will get tax payer money, but where the money will end up. It is a shame for congress to demand that the Big 3 present plans for restructuring the way they do business without demanding that the United Autoworkers Union do the same.

It is common knowledge that the other automakers (Toyota, Honda, etc.) do not have the legacy overhead costs that the Big 3 have (most of which is due to union payouts of some sort), and that they are more nimble because there are no unions bosses to satisfy when changes are made. Detroit automakers will not survive with the current productions costs they have to bear no matter how much money the government loans them.

Things have changed. Americans cannot go back to the way we have lived for the last two decades. Our viability as a nation depends upon everyone of us coming to grips with this reality. Neither businesses nor individuals can borrow their way to affluence any longer. Big unions will have to adjust their demands upon companies in exchange for job security, and they will have to revamp their organizations to cut the fraud and waste as well.

Our nation was built upon free enterprise with limited government interference. The current economic environment has been a catylist for some to move to change the basic structure of our economy from capitalism to quasi-facism. It is a major shift when the government uses borrowed money to buy shares in financial institutions that they regulate. This is the proverbial "fox in the hen house" scencario. The waste and mismanagement in the government is a good indication that those in charge need to do some house cleaning before they can take on some one else's.

It is up to the American people to say to goverment and to big business, "Enough is enough!"  We will not continue to sacrifice our children's and grandchildren's futures for the immediate gratification of bigger and faster toys. We have to put them on notice that the era of irresponsible spending has ended not only for individuals, but also for government and big business.

Fat Cats Are Fat Cats

How is it that the richest country in the civilized world can be experiencing such financial upheaval? Is it the greedy corporations, the corrupt politicians, the subversive communists, or the malevolent terrorists that have brought us to this point? Maybe it's a combination of them all! Maybe, but whenever I point my finger at someone else, I have three fingers pointed back at myself.

I am guilty because I am living on borrowed money just like our government, and I am demanding more services and considerations. The politicians respond to my demands by borrowing more money to give out the candy that we all want. Now that the economy is in a wreck, the conventional wisdom looks likes absurd foolishness. Borrow and spend sounds no better whether it is the government doing it or the individual. This house of cards has begun to fall and repairing it is a temporary fix at best.

Instead of demanding the government bail us out, we need to demand that the govenrment be fiscally responsible. Why? Because the goverment's source of income is your income. Every program, department, bailout, etc. begins with what Washington takes from our paychecks. The more that is taken from us, the less there is for us--to pay our debts, to fund our retirement, to send our kids to college.

Much is said about the greedy CEO's and Wall Street types that have drained businesses of billions of dollars. Yet little is said of the greedy, power hungry senators and representatives that have drained the American people of billions of dollars. Fat cats are fat cats. The one distinction is that business moguls have to provide a service or product to earn your money. You voluntarily surrender your money in return for what is offered. Government moguls whimsically decide that more money is needed to fund a pet project then pass a law that allows them to involuntarily take your money in return for nothing.

Once we decide as a nation that we can no longer live the high roller life style, we will stop those in the goverment from doing the same. Think about it, not only do we have to pay the freight for our own excessive living, we also have to pay for the overspending of an out of control government. If we are not careful, the politicians will bankrupt us all.

Change, Not A Shame

Now that the elections are over, we have to return to the real world. All the promises that have been made will now be tempered by the stark reality of hard economic times. Although the government has the power to create jobs, it has no income producing ability to pay for those jobs. So every government created position comes with the built in necessity of gathering taxes to pay the salaries.

When someone in the goverment says, "We are going to put the American people back to work," beware, that also means we are going to tax the American people so that we will have the money. The way the economy is right now, increasing taxes would only cause greater hardship in the form of more cutbacks, less hiring, and less spending.

There was a clarion call for change during the election. We do need change! We need to change from a selfish, greedy nation of consumers to a nation of benevolent givers who know when enough is enough. No longer can we afford the lifestyles of the rich and famous that encourage us to spend more than we make and then when we can no longer bear up under the payment pressure bailout and want to be bailed out by others.

We have to change from a culture of assumed priviledge to one of appreciative responsibility. No doubt we have been blessed as a nation, but rather than using our great wealth and resources prudently, we have squandered them. Now we stand at the precipice of economic meltdown that can only truly be reversed by a fundamental change in our governmental, business, and personal financial habits.

Change will begin when there is a realization that the rampant narcism has to end. We must once again see ourselves as a vital part of the whole willing to make the necessary sacrifices so that we pass on to our progeny the same or better opportunities, freedoms, and global position that we have enjoyed. The immortal words of a beloved president still ring true, "Ask not what your country can do for you, but what you can do for your country."

Government Bailouts and Personal Finances

I think most of us would agree that the United States has the highest standard of living in the world. We certainly do not have a problem with our level of income being sufficient to provide for our needs. We live well here and there is nothing wrong with that.

We live well but are we doing well? Government bailouts and takeovers of major businesses indicate that our finances are suspect. Foreclosures and repossessions on the individual level reflect that it is not just the corporations that have taken unwise ricks. But there are no bailouts for individuals -- no one to purchase their bad debt.

So the individual American is left to fend for himself. Is it not time for hard working Americans to stand up for themselves and stop expecting some kind of bailout from our friends in the government? We need to take our personal finances more seriously in light of recent developments.

The best defense against recession, job loss, and/or economic uncertainty is to be debt free. Sure this sounds different from what we have heard. Many financial experts told us to use other people's money to finance our way to wealth. But the days of living by that kind of advice have to come to an end.

Average Americans need to do two things: get control of our finances and create margin in our budgets. For most, once we have gotten a clear picture of where we are financially, it will be obvious that in order to correct the situation we will need to interject more money into our budgets. This cash infusion may come from increasing our income or from decreasing our expenses. One thing for sure, it will not be easy because both will call for discipline and sacrifice.

Our heritage is one of discipline and sacrifice so though the road ahead might be rough, I am confident that the American spirit will prevail. We will individually and cooperately take the steps necessary to free ourselves from the tyranny of debt so that once again we will be a shining example to the world of freedom and properity.

The Great Escape

One of the biggest problems in Christianity today is the indebtedness of individual Christians. This indebtedness is causing tremendous problems for the Church as money issues continue to be one of the major factors contributing to marriage disharmony and even divorce.

This blog is dedicated to finding solutions that can be presented to the Christian community to help Christians acknowledge the problem, begin to reduce their debt, and move toward becoming totally debt free.

There are several issues that must be addressed individually in order to begin to remedy the problem on a personal level. The first is budgeting. As I talk to Christians about their finances I am surprised to find that many do not have a written budget. The amazing thing about this is that some of them serve as elders, deacons, and trustees who would never think of running their church without a budget. Yet in their personal finances they have not given much thought to a written budget.

A second issue is balancing checking accounts. Since the advent of online banking, the use of check registers as the primary way of keeping up with the checking account has nearly become obsolete. This would not be a problem if account holders were using one of the many computer check register programs available on the market. But such is not the case. Many are instead trying to do their balancing using the running balance displayed on their online statements. This is causing record numbers of NSF (insufficient funds) fees for the banking institutions and enormous problems for those using this method. Usually when one check bounces it causes a chain reaction.

A third issue is living beyond our means. We have all heard that most Americans are one check away from financial ruin. The savings rate in our country is dismal in comparison to the average income. I do not need to give you reems of statistics. Look in your own savings account and see for yourself. Do you have 6 months worth of savings to carry you through a rainy day? If not, then you are a statistic.

I could summarize these three issues in two words: NO PLAN! A plan consists of goals, accountability, and discipline. Most of us lack these and that is why we are in such a critical financial state.

But there is an answer to this delimma. We, as Christians, need to get back to following biblical principles. The bible has much to say on the issue of finances. If we are not getting the whole story from the pulpit and/or in church school, then we need to look to other resources. There are plenty of resources available that deal with the issue of money from a Christian perspective. We will review many of them on this site.