Tweet

The Debt Dilemma

Guest post by: Jim Stovall

Article Overview: A wise man once posed the poignant question, "If you can't pay for it now, what makes you think you can pay for it later?" As a society, we have dealt with debt for so long that we have become immune to it. Most people have a hard time conceiving of a million dollars, much less a billion or a trillion. If you live in the United States and would like to get a perspective on our nation's debt, go to www.USDebtClock.org.

The Debt Dilemma

A wise man once posed the poignant question, "If you can't pay for it now, what makes you think you can pay for it later?"

As a society, we have dealt with debt for so long that we have become immune to it. Most people have a hard time conceiving of a million dollars, much less a billion or a trillion. If you live in the United States and would like to get a perspective on our nation's debt, go to www.USDebtClock.org.

On that site, several things will immediately become obvious to you. First, you will see the collective numbers all scrolling past so quickly that you can hardly keep up with them. Next, you will note that all the numbers are growing larger at an alarming rate. During the time it will take you to read this column, our national debt will grow over $1 million.

If you want further perspective from an individual citizen's standpoint, you will note that the portion of the debt for every man, woman, and child in America is over $40,000, and it's over $120,000 for each taxpayer. While these numbers are staggering today, you can only imagine what they will be next month, next year, and in the next generation.

Getting into debt is like digging a hole. The first thing one must do to get out of the hole is to stop digging. Not only are we not paying off past debts, we are continuing to dig the hole even faster than ever before.

The only thing you and I can do about this national debt is to let our senators and representatives know we want it stopped; and if they don't respond, we need to get new elected officials. On a much more personal and maybe more relevant note, we need to look at our individual debt.

For over 20 years, I have been on the board of a scholarship fund I co-founded in 1988. In the ensuing years, we have given out hundreds of scholarships and reviewed thousands of students' applications and financial statements. Twenty years ago, it was rare to see a student graduating with more than a few thousand dollars in debt. Today, we see many students leaving college with an undergraduate degree and $50,000 to $75,000 in student loan debt in addition to $25,000 or $30,000 in credit card debt. You don't have to have a college degree in mathematics to realize this is not sustainable.

If you are one of the millions of people drowning in personal debt, there is a simple solution, but it's not easy.

1. Get a full accounting of exactly where you are.

2. Establish a monthly budget and stick to it.

3. Cease borrowing any more money.

4. Aggressively pay down your debts.

Realize that you didn't get into debt overnight, and you're not going to get out of debt overnight.

As you go through your day today, realize that you cannot keep paying for yesterday's bills with tomorrow's income.

Today's the day!

Related Articles
  FDCPA Laws
  Beware of Charged off Debts!
  Know your Rights in the FDCPA
  FDCPA Assures Rights of the Consumer
  IS IT TIME TO CUT UP YOUR CREDIT CARD?
  How Does Debt Settlement Affect My Credit?
  Tips to Take Control of Credit Card Debt
  Debt Collectors should follow the FDCPA Laws
  Teamwork
  Credit Alliance Group has discovered that Banks and Collectors Have a New Twist on the Old Bait & Switch Tactic
  Debt Relief Facts
  What is Debt Collection Harassment?
  Debt Collectors Look for a Victim all the Time
  Credit Alliance Group understands that every dollar counts in paying off your credit card debt
  Debt Consolidation and Refinancing – Is it Right for You?
  Dealing with Debt Collectors
  Are part-time jobs your ticket out of debt ?
  Debt Reduction Tips Every Joe Needs
  Reduce Your Debt So You Can Save for Your Future
  How Will Debt Settlement Affect my Credit

Article Tags: debt reduction, Jim Stovall, perspective



Related Forum Posts
Re: Are Economic Recessions Good for Franchising? - All we can do is remain wide awake and pay attention to the ebb and flow. My strategy is to be prepared and go with the flow. There could be some rough times ahead... Interestingly, our business has remained strong. I believe it's because we're in such a tight little niche and we're well positioned to sign jobs nationwide, therefore we're not restricted to location. We also target affluent markets that have higher disposable incomes - this we do locally. Here are some Franchise Categories that could weather a good recession... Health and Personal Care Food services like Subway Debt Collection Tax Preparers & Advisors Any other recession proof franchise opps out there?
Getting something for nothing? - This is a tough one because it's hard to get something for nothing. There are two forms of financing - equity and debt. Equity is when you give up a part of your company / invention / idea in return for money or services. Hopefully the person you are bringing on is someone you can work with because you are now partnered until you sell or close down the company or buy each other out. Debt is when you borrow money so you aren't giving up a piece of your company but you have to pay the money that you are borrowing back. If you have a solid credit history or tangible assets then you can get it from the bank. If you don't have either then you can get private money but the interest rates will be higher (10% or more). Since every month you'll have to make payments you'll have to think about how long it will take you to start bringing money into your business from your invention. Either way you're giving up something in return for the financial help.The only other options I can think of are government grants that you don't have to pay back or befriending people who want to help you because they like you and by doing so they are being rewarded (very hard to find!) Good luck!


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Top 7 Tips to Real Estate Agents’ Success

20 MORE Must-Have Search Engine Marketing Tools

How To Become A Member of the Paparazzi

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.