No. 78

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There is a new and noisy kind of plastic surgery taking place in America today. It's the sound of people who are cutting up their credit cards! It's too late for many people as we have reached the point where over one million families are filing for bankruptcy each year. A recent report revealed that the collective debt of the American people is now over one trillion dollars and about 40% of this is credit card debt. While filing for bankruptcy may seem like a panacea to some people, it has far reaching consequences and this is the primary reason I decided to write this column.
Who knows, I may be able to keep a few people from going down the path that leads to financial ruin. While I believe in the individual rights of every person and how they handle their financial affairs is up to them, however, it does affect all of us when they act irresponsibly. When a person files for bankruptcy and the slate is wiped clean, the debt still has to be paid by someone. In most cases, it's simply passed along to the American consumer in the form of higher prices, which means we all pay. The saddest story of all is about the one who does the filing. It may appear that they get off "Scott free", but in reality they have been branded, much like a cow on a Texas ranch and it stays with them for the rest of their life, psychologically, if not physically.
Now, please understand that I'm not saying that all credit is bad. It's good when used in the proper way and most of us would not be where we are today if it were not for credit. Over the years, we have had a great number of loans and installment contracts and I'm proud to say that everyone of them has been paid back, either before or on time. At present, we only have one credit card with a very low balance, and we keep it for tax purposes, emergencies and convenience, in a small number of cases.
It's easy for me to see why many people get in a real dilemma when it comes to the use of credit cards. Several times each month we get offers from various credit card companies with special offers, low introductory rate, no annual fee, life insurance benefits and on and on. They make it so easy and if you don't have the self-discipline to say "no", you can be up to your neck in hot water in a very short period of time. The problem for most people comes when they live so close to the edge and when an emergency comes along they are wiped out. After several months of being wiped out, then bankruptcy becomes more and more attractive. As I said earlier, "don't do it" and don’t get yourself in a position where you have to even consider it, because the consequences are long lasting.
If what I'm saying applies to you, I believe you will appreciate something titled Economy Raises Revenue. This has been a great guide for us when it comes to spending and saving money. "Your ship won't come in except through the straight of economy. You can increase your wealth by decreasing your wants. You can raise your wages by lowering your expenses. You can have more by wanting less. What you make is not as important as how you handle it. This requires efficiency, planning and the maturity to stick with the plan. Economy does not mean no spending, it means wise spending. Frugality takes the view that a thing not needed is too high at any price, and there are so many things we don't need.”
In conclusion, here are a couple of questions that may be worth thinking about: Do I need plastic surgery at this time in my life? If I continue with the same spending habits as I have in the past, am I headed for some real financial problems down the road? As I said earlier, my heart’s desire is to help you. (EDITOR'S NOTE: Jim Davidson is a motivational speaker and syndicated columnist. You may contact him at 2 Bentley Drive, Conway, AR 72034.)

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