Debt Nation: Using Debt To Make Ends Meet Will End You Financially – Stop It Right Now

For many
people, balancing a budget can be quite difficult. It’s not because they aren’t
good at Math. It’s just that life can be unpredictable. Things happen that can
throw a curve ball to your budget that managing it feels like a balancing act.

If you have
kids, their needs increase as they get older. Tuition fees become more
expensive.

Someone in
the family might get sick. Hospitalization, doctor’s fees, and medicines can be
quite expensive.

Your car
breaks down. Car repairs and maintenance are not standard items in your monthly
budget.

Then there
are the economics of day-to-day life:

• Petrol prices go up
• Cost of commodities go up
• Traffic gets worse, you’re stuck in the main freeway longer than usual

Unless your
boss gives you a nice, fat pay raise or your business is in a boom cycle,
chances are your expenses are higher than your income.

For many
people who can no longer balance their budget, debt becomes the only solution.

So they
apply for ready credit facilities from their bank or secure a quick cash loan
from a lender.

They will
use the money to pay off shortfalls in the monthly budget. Why go into debt to
make ends meet?

In their
minds, this is just a temporary situation. Everything will be back to normal
after a few months.

“Perhaps I
can get that pay raise that is long overdue.”

“Hopefully,
sales will pick up in a few months.”

They borrow
money based on a hunch or speculation that “things will get better”

There is a
term lenders and banks like to use:

“Bridge
finance.”

Borrow
money or get into debt in order to bridge your monthly shortfalls.

Unfortunately,
nothing is ever written in stone.

That pay
raise might never happen.

That sales
boom might end up a bust.

That bridge
can collapse and cost you more money than what you actually owe.

So don’t
use debt to make ends meet. The risk you take is much greater than the expected
rewards. Rather than get into debt, you can do the following:

• Cut out unnecessary expenses. You’ll be surprised
  at how much money you can save by not eating out and spending for a cup of
  coffee at your favourite coffee shop.
• Manage your utility bills. Close all lights in
  rooms that are occupied. Ration your usage of water. Sleep earlier.
• Find a second job, a side line, or take freelance
  projects for extra income.
• Come up with a garage sale and make money from
  stuff you don’t need.
• Be prepared to sacrifice. This might mean
  sacrificing the annual vacation or cancelling subscriptions to cable TV and
  Netflix.
• Be ready for a lifestyle change. Are you still
  single? Well, you may have to stay single longer. Cut out date nights and
  social gatherings. Are you married? You and the spouse may have to spend more
  time indoors. Family? Tell the kids that family activities will be cut down a
  bit.

Debt is a short cut that offers no long-term solution. Avoid
debt at all costs and just focus on making your current situation better even
if it means implementing temporary cutbacks.