Ease of Credit, Pain of Cash

I have been working towards becoming debt free for my entire adult life.  Ever since I was 18 I have had some sort of debt.  It started out small and as time continued to pass my debt accumulated.  Instead of having a credit card with a low limit I managed to add multiple credit cards, store cards, personal loans, auto loans and student loans to my list of debt.  (Click here to read about my journey into debt).

Despite all of these liabilities hanging over my head, I continued to spend.  It was easy to whip out the plastic and buy whatever I wanted with no regard to whether or not I could actually afford it.  I had paychecks coming in every week to pay my minimum payment.  I thought this way for many years and it wasn’t until I was on the verge of disaster that I began to realize that things weren’t working.

My financial turnaround has been a complex transformation.  It was hard for me to change my cycle of impulsive buying and accumulation of material possessions.  There were times when I felt as though I would just DIE if I wasn’t able to buy a new pair of jeans.  In time I realized that I didn’t need to be buying so much stuff.  I also began to understand how my spending behavior today would affect my financial future.  If I didn’t stop my self-destructive spending, there would be no financial future, I would be a “work ’til I die” kind of guy.  That didn’t make me feel very comfortable.

I began to scale back on my purchases and cut my spending.  I was able to eliminate all of my debt, with exception  of my car loan and student loans, by February of this year.  The feeling of reaching this milestone was amazing.  Instead of paying for my past I could finally focus on planning for my future.

Without having debt draining money out of my life, money no longer seemed hard to come by.  Payday would roll around and I would actually have money left over.  Now I didn’t need to pay for things on credit, I could afford to pay for them with money I had earned, not money that I was borrowing.

Paying for things with my own money has brought a feeling of conscientiousness about where my money is being spent.  I attach more emotion to my spending now that the money is coming directly from my bank account.  When I was using a credit card, I was focusing on what the monthly payment would be.  I didn’t care if I was spending $1,000 on something I didn’t really need if the payment was only $50 a month.  That didn’t cramp my style.

The purchase of my bicycle was my first major purchase of an item with my own money, and it hurt.  It hurt knowing that the money I had worked to earn and had saved to have would be gone.  I really wanted a bicycle and I went through with making the purchase, but it wasn’t an easy decision to make.  On the other hand, had I been making the purchase with borrowed money, chances are I would have bought a much more expensive bike and there would have been no emotion attached to that money which I just spent.

The more I drift away from using credit (I still use it for convenience, but pay it off immediately), the more emotion I attach to my money.  It is my money, I earned it and I don’t want to toss it around like it is going out of style.  When I was in debt and using credit, it didn’t matter to me because it wasn’t my money and I hadn’t earned it.  Credit cards make access to money you don’t have too easy and it is because of this easy access that we tend to overspend when using them.  It doesn’t matter what the balance on our cards may be, it only matters that we can make the monthly payment.  That is a terrible frame of mind to be in.

Put your credit cards away and work towards building a healthy financial future; one where you can actually afford to pay for something with your own money, not money you borrowed from someone and stole from your future.