Chapter 12: Dealing with Debt

If you’re broke, stressed out about your financial situation, or couldn’t ever afford to miss a single paycheck – welcome to the club, as you’re certainly not alone. It is just not something anyone really likes to admit, or talk about. It’s sad but true that the last thing we ever want to say out loud is that we can’t afford something, or that we’re in trouble, isn’t it?

Debt creeps up on you little by little, here and there for one reason or another. The balances get higher, the minimum payment moves up, one account gets used to cover another, the car needs repairs, the vacation is important but goes on a credit card and so on. Savings become less, IRA or 401 (k) contributions are delayed or reduced just this year, and sometimes savings are used to pay some bills – just this once.

Debt is a silent killer that starts choking you, your lifestyle and your ability to maneuver. It is something most people already realize. After all, an Ipsos-Reid survey some years ago showed that over 90 percent of people listed paying down debt as their top financial goal. Debt stops savings and starts reversing years of hard work and discipline to build them up. The minimum payments creep up without much notice until one day – maybe not for quite a while – the juggling stops working. It might be a couple of weeks off work, unexpected medical or repair bills, taking Christmas shopping way over budget, or a host of other reasons.