Is DEBT Always a 4-Letter Word?

Photo "Wiping out debt" courtesy of http://taxrebate.org.uk

Photo “Wiping out debt” courtesy of http://taxrebate.org.uk

According to the 2015 American Household Credit Card Debt Study, U.S. consumers owe a total of $712 billion in credit card debt, and $8.37 trillion in mortgages. The average American household has $132,086 in debt, with $15,310 of that on credit cards. For those carrying student loan debt, the average balance is about $49,000.

OUCH.

Like risk tolerance, debt tolerance varies greatly from one person to another, depending on one’s circumstances, upbringing, etc. Some people seem to embrace debt like an old friend, while others avoid it like a weekend visit from the in-laws.

Financial guru Suze Orman believes that there can be such a thing as “good debt” in certain circumstances: student loans for an education that will improve your earning potential and net worth in the long run; a reasonable mortgage, when it’s managed responsibly and has an end in sight.

The Minimalists, on the other hand, wholeheartedly profess that “There is no such thing as good debt!” Debt is the thing that keeps us stuck in jobs we hate, making payments for a bunch of stuff we don’t need, trying to impress people we don’t know or like. All debt is evil. Avoid it at all costs.

Unfortunately, many people do get in over their heads, taking on more debt than they can comfortably afford. Hopeful twenty-somethings graduate from college with six-figure debt, only to move back home with their parents and work at Starbucks. Young families bury themselves in decades of mortgage debt in order to buy the McMansions of their dreams, furnish them with credit cards, and lease luxury SUVs to impress their equally indebted neighbors, without really looking at the big picture or questioning whether or not it makes sense for them.

While mindless consumerism likely accounts for some portion of this mountain of consumer debt, according to NerdWallet, other economic factors are also at play:

Household income has grown by 26% in the past 12 years, but the cost of living has gone up 29% in that time period. And some of the largest expenses for consumers — like medical care, food and housing — have significantly outpaced income growth.

When cost of living outpaces income growth, debt increases.

It would be easy to say consumers are spending irresponsibly, leaving the recession (and their budgets) in the dust. But it’s not quite that simple.

Personally, I don’t think any type of debt should ever be considered “good.” But I will acknowledge that, in certain situations, when entered into mindfully, with a clear means of repayment and an end in sight, some debt can be used as a tool to improve our lives and help us meet our long-term financial goals.

A small mortgage, for example, can make sense if the monthly payment, including taxes and insurance, is equal to or less than you’d expect to pay for rent. If you’re blindsided by an unanticipated financial emergency without adequate savings, a credit card can be a lifesaver. A small car payment can provide the means to obtain a reliable vehicle to get you to work every day.

What do you think? How do you feel about debt? Is it an important financial tool, the root of all evil, or somewhere in-between?

~PEACE~

The Importance of Finding Your Tribe

As I strive to embrace simplicity, turn my back on mindless consumption, and form positive habits in my daily life, I feel like I’m fighting an uphill battle every day. All around me, friends, family, coworkers, and even casual acquaintances question why I want to live this way.

Why don’t I want to eat a bag of Cheetos and a box of cookies every night?

How can I possibly be satisfied with a 3 year-old cell phone and a 5 year-old TV?

Why don’t I want to go to Wal-Mart?

How could I even consider giving up such a “good job” at the post office, when I’ll be “all set” with a pension for life if I just “hang in there” until I’m 60 years old?

Why don’t I want to make more money?  

Why am I giving away half the clothes in my closet?

Sometimes, in my darker moments, I even start to ask myself those same questions.

Then, every once in a while, I meet someone who gets it. Or I listen to the latest episode of The Minimalists’ podcast. Or I read a new blog post from Leo Babauta or Joshua Becker or Courtney Carver. And I remember that I’m not alone. I’m not crazy. I just want to do things a little differently. I want to live my life a little more deliberately.

If you’re following this blog, then chances are, you’re interested in living a simpler and more purposeful life as well. Some of the people around you probably don’t understand. But remember that there are plenty of us out here who do. Those are the people you have to surround yourself with. They are your inspiration and your allies.

Thanks for reading, and for being on my team. I hope we can continue to help and inspire each other to follow our own paths to meaningful living. It isn’t always easy, but it’s always rewarding.

~PEACE~

June Challenge Update

I’m one week into my de-cluttering experiment, following The Minimalists‘ formula for getting rid of one thing on the 1st day, two on the 2nd day, three on the 3rd day, etc. for an entire month. Here’s a quick day-by-day summary of my progress so far:

  1. Tossed out a freezer-burned bag of blueberries.
  2. Put a jar candle and candleholder in the “Yard Sale” pile.
  3. Got rid of 3 bras that were no longer fulfilling their purpose.
  4. Shredded 4 old job-bidding cards from the post office.
  5. Gave a small crock pot and Dremel tool to my friend for her new jewelry-making hobby, and added a plant pot, laundry bag, and pitcher to the yard sale pile.
  6. Picked 2 suits, a dress, a jacket, a pair of pants, and a purse out of my closet for the “Donate” bag.
  7. Trashed 7 expired food items from my pantry shelves.

Most articles so far fit into the following “disposal” categories:

  1. Donated
  2. Trash
  3. Gave to a friend
  4. Sold (via yard sale or Craig’s List)

The donated and yard sale items haven’t gone anywhere yet, but are forming two piles in my bedroom, awaiting their final destinations. By the end of the month, I plan to have several bags of clothes to donate, and multiple boxes of items for our yard sale.

As soon as I started this challenge last Monday, it became clear that I would have to take it to the next level by not only getting rid of old stuff, but also by NOT acquiring anything new this month. That means no new clothes, household items, electronics, etc. (Still waiting to buy that iPad!) Consumables like food, and personal care & cleaning products are OK, as are electronic purchases that don’t take up any physical space, like Kindle books and iTunes.

I also realized that I would have to get my husband on board with my mission when he came home Friday night with 5 steak knives that he picked up at a yard sale! SIGH. Five steps forward, one step back.

By the end of the month, I’m sure I’ll be scraping to find 30 items to eliminate, but this early in the game, I’m having the opposite problem. It’s hard to stop at one or two things. Inertia is a strong force! De-cluttering one area leads to another, then another. In addition to the list above, I also found myself shredding 53 debit card receipts that I’d stuffed into my checkbook, and eliminating the pile of junk mail and catalogs that had accumulated on the table by my front door.  I’ve got big plans for the piles of unread magazines in my office, but they’ll just have to wait until week 4!

These days, I definitely derive more satisfaction from having less stuff and holding on to my money than I ever got from spending money and buying new stuff.

My, how I’ve evolved!

~PEACE~

 

 

Slow Down!

For the past week, I’ve been reading Ernie Zelinski’s book The Joy of Not Working. The title says it all, I thought. But does the concept of finding joy in not working really need further clarification? For a lot of people, apparently, it does.

Unfortunately, according to Zelinski, most working folks just don’t know what to do with ourselves when we’re not working. Our work-life balances are weighted so heavily on the work side, that we don’t know how to enjoy our leisure time, if we even allow ourselves to have any. For many, the prospect of being unemployed or retiring is terrifying. Some of us are so afraid to be alone with our own thoughts, it seems, that we just keep running on the treadmill to escape them. We’re sick, we’re exhausted, we’re bored, and we’re boring.

Instead of using our rare leisure time wisely, we waste it on “passive leisure” activities to distract us from our misery: watching TV, hanging out in bars, and wandering around shopping malls. So many of the things we think we want — bigger homes, new clothes, the latest electronic gadgets, expensive cars, etc. — are dictated by the media, our “friends” and relatives, and most of all, the people who are going to profit from selling us all of these things. So we keep chasing the money. To buy the things. To fill the empty holes in our boring lives, in our souls. Is this living?

I know, however, that there are plenty of people out there who are tired of the “live to work” mentality that has ruled our culture for so long. The tide is turning. Change is in the air; I can smell it, like springtime. Forget about trying to keep up with the Kardashians. We want time to think. Time to live well-rounded lives. We don’t want to be overworked zombies anymore. And we don’t need to clutter up our homes with more shit from Walmart either!

Do you feel like your work-life balance needs an adjustment? Then take a few days off from work, or even a week or two if you can, and dedicate yourself to reclaiming your time and your life. I mean it! Take the time to really think about the things that are important to you. Meditate on it. Don’t be afraid to dream. Think BIG. Forget about what everyone else says you should want or need or have or be. What kind of life do you want? How much money, how much stuff, do you really need? How do you define happiness, and what’s it worth to you? Come up with a plan, and implement it like your life depends on it, because it does.

Zelinski actually recommends making a list of at least 300 “Get-A-Life” activities, and offers his own list of 300 for inspiration. So climb a mountain if you want to. Quit your job. Write a book. Get a better job. Walk in the woods. Start your own business. Learn to play an instrument or speak a new language. Volunteer. Take a road trip. Work for free. Buy a hammock. Take a class. Clean out your closets. Chew your food. Play with your dog. Plant a tree.

Then after you’ve made your own list, and crossed off a few things, sip a glass of wine (or other beverage of your choice) on the front porch in the early evening and watch all your stressed-out neighbors race by on the way home from their miserable all-consuming jobs. Poor bastards.

We all have so much potential. Don’t waste it all on work. We are so much better than that, and we deserve so much more than that. Let other people run in the rat race. Smile and wave and cheer them on from your front porch, glass of wine in hand. We know better. The fast track is so yesterday!