Personal Traits That Lead to Debt
Many experts will tell you that conquering debt must
be approached in a similar manner to treating drug,
alcohol or food addiction. The behavior of money mismanagement
and abuse must be overcome before you can treat the
symptom: debt. Technical solutions like getting a loan
or consolidating payments don't work, and may even worsen
the problem, because the contradictory behavior of mismanaging
money still exists. Traditional approaches for solving
money problems focus on reducing the amount of monthly
payments. Financial troubles need to be addressed using
a series of steps to beat the money abuse addiction;
only then can you focus on solving the debt problem.
Often, people obtain debt consolidation loans to pay
off credit cards and other debts, and then 6 to 12 months
later the card balances are again maxed out and other
debts have been accumulated. In order to get out of
debt, you must learn to change your spending and money
management behaviors, which often means a change in
lifestyle.
In his book, Debt-Free Living: How to Get Out of Debt,
Larry Burkett offers us three personal traits that lead
to debt: ignorance, indulgence and poor planning.
- Ignorance
“Ignorance” refers to a lack of understanding about
the true nature of your financial situation, and a
"living in a dream world" approach to financial
matters. False perceptions about what we can really
handle financially can get us in trouble, especially
during big spending times such as Christmas.
- Indulgence
“Indulgence” is one of the worst downfalls of our
“buy now, pay later” society. In a world where we
are constantly bombarded with messages like “have
it your way” or “get it now, no payments for one year,”
we have come to expect immediate gratification. We
need to retrain ourselves to save for things we need
or want.
- Poor planning
Poor financial planning almost always leads to overspending
and deeper debt. It is critical for you to take responsibility
for your own financial affairs. People often think
they shouldn’t worry about financial plans because
they aren’t rich or they don’t own much. Additionally,
financial planning includes some issues most people
are reluctant to think about like death, disability,
or illness. But failing to plan only inhibits your
ability to achieve monetary goals and life aspirations.
Anyone who has financial challenges to solve or financial
goals to achieve needs to create a financial plan
and modify it throughout life.
The following is a list of some behaviors that define
money abuse. If you recognize any of these behaviors,
it is extremely important for you to modify your money
management practices and change your lifestyle to really
get out, and stay out of debt.
- Repeated, unsuccessful attempts to control, cut
back or stop excessive money use;
- Feeling alone or empty inside and using money to
purchase goods or services in an attempt to feel better
or improve self-esteem;
- Spending money as a way of escaping problems or
relieving stress;
- Lying, minimizing or rationalizing to family members
or others to conceal spending;
- Losing out on opportunities such as a significant
relationship, job promotion, or educational or career
opportunities because of money consumption;
- Feeling the need to spend money on or with others
in order to maintain a relationship with those people;
- Buying things to impress or influence others
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