Stop Incurring Debt, and Start Having a Life

by Diane Conlinn, November 6, 2000

The traditional wisdom of creditors and debtor relief organizations is to put our creditors first. Although, I do believe that we should repay our creditors what we owe them, I don't believe we should put them at the top of our priorities.

Unsecured debt (not secured by real property such as car or real estate) is a never ending hole, and to stop feeding it. We must begin to take care of our families first.

The priorities are food, shelter, as well as meeting our personal needs of clothing, and yes, sometimes leisure and entertainment. If a person is so deep in debt that it will take many years to repay their debt, then some attitude changes must occur.

Why do we debt? We debt because we feel we must have something and we don't have the money available. Why don't we have the money available, because we didn't save the money when we could OR we have a debt that we are repaying that is taking the money we could be using for this new need.

So what to do? How to end this spiral.

First of all, it is important to keep track of your spending. Track every dime you spend, no matter how much for at least a month. Find out where your money goes. Next, with others to help you create a spending plan. Putting your monthly expenses first. Rent, food, clothing, pet care, school clothes, automobile payments, insurance. Don't forget to include a few of the necessities of the spirit as well, a few movies, or books, or other entertainment. When you add that all up, what is left, is what can go to your creditors.

What, you say? But, that's only $50 and I have 20 creditors. Write each creditor a letter and send each 2.50 a month. Then as soon as your situation changes, let's say you get a windfall of $600, divided that $600 in 3 parts, and pay $200 to your creditors, $200 to your present needs, and put away $200 for that future contingency which is what got you where you are in the first place.

Of course, when I talk about a spending plan, I do mean reasonable amounts. Perhaps, your job requires you to wear suits, then $25 a month for clothing is probably not going to work. And what about dry cleaning and laundry. Don't write down what you wish would happen, write the reality down.

The interesting thing about this is that if you keep following this plan, you will eventually build up a contingency fund for those emergencies, you will have money to buy clothes, and take care of your family and those reasons to have credit cards will disappear. You can just cut those cards up and throw them away.

If you find your expenses are more than your income, then it's time to get a better job. Or find a way to change your expenses.

A good resource on the Internet for those that are interested in reforming their thinking about debt is I recommend it highly, it certainly changed my attitude about debt and kept me out of bankruptcy. My life is so much better today, I cannot say than when I started.

Believe me it works.

I am not a lawyer, thus, if you have questions, about this please check with your attorney. Thanks.