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Do You Have a Debting Habit? Author: Joan Sotkin For years, a man I'll call Harry, was a habitual debtor. He always had at least a few thousand dollars in credit card debt, owed money to doctors, his parents and business suppliers, and had a very overdue college loan. He couldn't remember when he was ever free of debt. Harry used credit whenever possible to buy inventory and services for his business. In order to have enough money to live on, he was constantly juggling funds to pay for goods that sold long before he finally paid for them. No matter how much money he generated, Harry never had enough to get ahead, and he never had a prudent reserve. Every so often, the pressure would get to be too much, and Harry would be overwhelmed with worry -- more like terror. Fear of failure took over. Harry played a great game of "Beat the Bank" and would somehow convince the bank, to give him a bigger line of credit, an unsecured loan, or a bigger reserve on his checking account. When all else failed, he'd convince his parents to lend him money (which he rarely paid back). If prosperity and financial freedom is your goal, then dealing with debt is essential. Being in debt and experiencing abundance do not go hand in hand. Even if you "know" that you are destined to make major money somewhere off in the future, you have to address your debting habits if the money is ever going to manifest. One of the main reasons people debt is because they have a fear of abandonment and being alone. Debting (or lending) is a way of staying connected to another person. If I owe you money, you aren't going to forget about me. Debting also allows people to feel deep shame that they have been carrying around for many years. Misbehaving with money is a great way to get in touch with and express the shame. Think of how you feel when you bounce a check, forget to pay an overdue bill, don't balance your checkbook or have to talk to a creditor about making a payment late. That feeling is shame. Anger also acts itself out through debting. People who often borrow money from their parents and don't pay it back, are expressing anger. It's a way of withholding. There are some tell-tale signs that you have a debting habit. Here are a few: Always carrying an unpaid balance on your credit cards (or have maxed out cards) Rarely being solvent Feeling deep fear or terror about not being able to pay your bills Making promises to creditors that you can't meet Borrowing money from family or friends -- even small amounts Unrealistic expectations about funds that are coming in Feelings of euphoria when opening a new charge account or getting a new loan. Feeling that the only way you can "make it" is to find someone to help you financially. Chronic under-earning Bouncing checks often Money pain can get very serious. Unfortunately, it's not something people talk about easily. Suffering in silence is the usual mode. As a coach, one of the functions I serve for people is non-judgmentally listening to them about how they deal with money. It helps to have someone who isn't going to punish you in any way when you talk about your money habits and will help you create a rational plan for dealing with your debt. A spending plan that eliminates the vagueness that you may have about money is a valuable tool. The first step towards changing your money habits is to make a commitment to make the change. This means committing to not incurring any new unsecured debt. If the thought of never using your credit cards again is uncomfortable, then you have a problem. (Debit cards, where you put money into a MasterCard or Visa account before you spend it works fine for online and mail-order purchases, car-rentals, etc. ) Don’t expect to take major steps quickly. It takes time to get over the fear of giving up credit and debting. If you can find someone to talk with about it, great. The next step is to carefully list all of your debts, monthly obligations and income. If you are in business for yourself, determine how much you bring in, on average, per month (not what you hope to bring in). If you have a feeling that you don't really know where your money goes, carry a pad and pencil around with you for at least six weeks and write down *everything* that you spend and everything you earn. At the end of six weeks, categorize and total the figures. (This can cause great discomfort for some people.) If you are a serious debtor, then you might consider going to Debtors Anonymous. Based on the 12-Steps of AA, DA has been around for almost 20 year and has helped countless people change their money habits. Visit DA online at DebtorsAnonymous.org. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Create a holistic approach to
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