Dollars and Sense

Like most Americans, I’m having an issue with debt.  I’ve been in this place before, where my credit cards have become a burden, and the fees become more than just a little nuisance.  The last time this happened I took a loan against my life insurance and was able to pay off the higher-rate cards to the point where my overall CC debt was only a few thousand dollars.  Which I figured to be manageable.  Or so I thought.

What seems to happen when you have less debt is; that you start thinking you have more money to play with, which isn’t really the case.  What you have is a pot of borrowed credit and the mistaken impression that it’s yours to do with what you wish.  And you can pay it back over the long term. Which IS true, but you’re going to end up paying a lot more over the long term, much more than the initial balance.  So you start looking at ways to repay it that aren’t going to take 5 years or more.  And the cycle begins anew.

Sure you can try the Ramsey ‘Baby Steps’ program, but unless you’re able to stop using the cards completely, you’re playing against the house, with the house’s money.  Right now, I’m employing the ‘Rob Peter to pay Paul’ method, which has 2 outcomes.  Success or failure.  And if my debt balloons again while I’m paying off the loan from my insurance, then I’m probably going to be lightly screwed.  But it’s up to me to make it work.  And I’ll be keeping a close eye on the issue this time.

We’ll see how it goes.  There will be updates.


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