NO more Stuff!

In today's world when we want something we just go out and get it. There's no saving and planning, it's lets go get it right now! We have been taught that it's okay to do this and have all kinds of debt. In 1980 the total consumer debt was $1.3 trillion and now it is beyond $3.3 trillion! The Wall Street Journal says that 70% of the American public lives paycheck to paycheck. The American Bankruptcy Institute says that in 1980 there were just more than 500,000 bankruptcies filed and by 2002 almost 1,500,000 were filed with new records set almost every year in between. How insane is all of this?

I was fortunate to take a financial class by Dave Ramsey. By age 26 he had a $4 million real estate portfolio and lost it all by age 30! However since then he has rebuilt his financial life and teaches thousands to manage their money. All the info above is from his book Financial Peace Revisited.

One concept really affected me and got me thinking. Dave said the average car payment in America is $464 ! (That is so insane to me) He suggested something else though, instead of going out and getting a car loan to do this: save $464 for ten months. At the end of the ten months go buy a car with the cash you have but then save $464 again for ten months. After these ten months go trade in the car you have and buy another car with the cash you saved. And just keep doing this until you have the car you desire and you'll have done it without ever having a car payment! Isn't that a great feeling to not worry about a car payment every month? The only thing is, you have to wait and be patient and save but at least you have peace. It doesn't have to be $464 or ten months, whatever works for you.

A story Dave told us was about a man who was raised with a grandpa who told him if he ever borrowed money, the grandpa would "kill" him (of course not literally). When this guy was 23 he had a job making $50,000 and when he got married his wife was a teacher making $30,000. In the beginning they lived in an apartment above a garage for minimum rent, and they lived on $30,000 and saved $50,000. They did this for four years. After the four years he went out, bought a house for $150,000, paid in cash and gave his wife a check for $50,000 to furnish the house! All it took was four years and now they have no mortgage as long as they live in that house. What an amazing feeling.

A recent survey conducted by Consolidated Credit Counseling Services found that 71% of Americans say debts are making their home lives unhappy. Money and debt are a major problem in America and cause a lot of divorces. We have to stop saying "yes" and start saying "not right now." I know this. In my early 20's I said yes a lot and now that I'm married and starting a new life I want to do things right. I don't need a new car every two years or to go out to eat four times a week or to buy "stuff." That "stuff" won't make us any happier especially if we can't pay the bills and we're stressing.