Why You’re in Debt
by SGL Financial
Debt is a scary word that no one likes to think or talk about. The reality is, however, that millions of Americans are in debt at varying levels. Even a small amount of debt can cause high levels of stress in our lives. It can seem that at one moment it is manageable and then before you know it you are so far into it you can’t see a way out.
No matter what age, we’ve all seen some kind of debt in our lives. Although sometimes debt can be a good thing such as a student loan or a mortgage, there are several reasons debt is bad and are probably why you got there and why you’re still in it. If you find yourself with some debt today, consider these factors as reasons that could have contributed to it and things you can work on to get yourself out.
1. You are Overspending: You spend more that what you make a month. If you see this happening, take time to sit down and really make a budget. Knowing what you spend your money on will really make a difference. After seeing a total of $150 in purchases at Starbucks a month, you might start cutting back on your venti mocha latte with skim milk and stick to your Keurig at home.
2. Technology: Though you are still the one in control, technology has made online shopping so easy that all you have to do is click a button. Voila! Sites that you can save your credit card on are the easiest of them all. They’ve taken all the emotion out of buying! Just because you do not have to physically hand over your plastic credit card or cash, doesn’t mean it won’t have the same impact on your pocketbook.
3. Medical Expenses: The costs associated with surgery or even a small procedure can be astronomical. And that’s not including the often times necessary prescription medication that follows. Unfortunately, health takes its own course in life and you never know when something could happen. If you have an emergency there’s no magical clock that aligns with your bank account so it knows you can afford it. So take care of your health!
4. Divorce: Now this one is a difficult one to talk about because no one ever wants to go through it. The key is to always plan and prepare before major life decisions. Splitting up assets, moving homes and starting out on a new journey in life can be costly. This is why that budget is so important and is a huge component to planning around your finances.
5. Education: Although it is essential to the everyday life of most people, financial education is often missing from school curriculum’s. I know I didn’t learn how to file my tax return or budget properly in school. Knowing how money works and how debt and interest can compound before your eyes will help keep you on the straight path when it comes to spending.
Debt is something that we all have to worry about. Knowing what some of the causes of debt are can help better prepare you for the future. Educating yourself can make all the difference in staying out and getting out of debt. Don’t let debt become a pitfall in your retirement. Save your money, spend it wisely and don’t be afraid to ask for help. I’m always here for advice, to educate you on what’s happening in today’s markets, to better prepare you for your future and be your guide through your financial journey.
