Credit cards and other debt are a massive problem for a lot of people. In fact, most people that have debt don't believe they will ever get it paid off in their lifetime. Consumer debt is a multi-trillion dollar problem that keeps people in bondage, affects relationships, and limits the freedom live your life on your own terms. Angie and I have had no consumer debt for over a decade now (except for a mortgage). I can tell you for a fact that living without debt makes a huge difference in how we live our lives! We refuse to let credit control our lives any more!
In this article I’ll show you four signs that debt is controlling your life. I'll also show you how to counteract the manipulation that comes with the marketing of credit to you as a consumer. Of course, I’ll also provide some killer resources to help eliminate the influence of credit and debt in your life for good.
Two Stunning Facts About Credit
A recent survey from Ipsos shows that 76% of Americans have at least one credit card. Another finding from the Urban Institute found that 35% Americans have debt that is in collections. That figure doesn’t include mortgage debt, which would certainly add to the total.
These facts alone make it plain to see that too many of us rely on credit- it’s not doing us any good.
So how did it end up this way? It's because the big banks have literally billions of dollars to spend on marketing. They mold our beliefs and emotions about debt, convincing us we need it to get by in life.
Battling that kind of marketing effort is an uphill battle. But when you recognize the consequences this marketing has on your life, you can take steps to reverse that influence and get the financial breakthrough you're looking for!
4 Signs You’re Letting Credit Control Your Life
So how do you know when you have fallen prey to the marketing and letting credit control your life?
Here are 4 recognizable signs that will help you determine if you have given in to the lies:
You Worry About Your FICO Score
A good credit score does not mean you’re succeeding with money. Maintaining an excellent credit score only means you’re good at managing debt. But you know what comes with debt? Interest and fees, stress, and the fact that debt keeps you in perpetual bondage.
The best thing you can do is to quit worrying about your credit score, cut up your credit cards, and use cash (and its equivalents) to pay for everything. When you go cash only, you won’t get into the trap of consumer debt, end of story.
Living Without a Credit Score- Your Questions Answered
Read my top post on how to transition to a Cash Only Lifestyle here.
You Love Credit Card Rewards
Earning rewards just for using your credit card is great, right? Wrong! Rewards are just a device that credit card companies use to manipulate you into using your cards more often. They even convince you to spend more on stuff you don’t need by giving you double or triple points at certain retailers or at certain times. It’s behavioral manipulation at its best.
When you fall for this marketing trick, you almost always spend more than if you had just paid cash. Even if you spend enough to actually “earn” the rewards, they are rarely worth what you had to spend to earn them. I used to use an airmiles card for my dental practice, so I know from first hand experience how this manipulation works.
With that said, I do know a few people (other personal finance bloggers) that claim to play the credit card rewards game successfully. However, most people don't have the time or diligence it takes to manage it without spending more than they would using cash.
Rewards cards will not make you financially successful!
You Think You Need a Credit Card “Just in Case”
For most people, this means just in case of an emergency. Credit card companies are all too happy to convince you that you need a credit card for unexpected expenses. They know that if you have a card available, you are going to use it.
Most people like to keep a card on hand for an emergency. But the reality is that they end up using it when they run a little low on cash at the end of the month just to make ends meet. That’s not an emergency, it’s just poor planning.
Doing a monthly budget and building an emergency fund keeps you from being tempted by having a card “just in case” that ends up causing you to spend more than you make.
Read how to start an emergency fund here.
You Believe Credit is Necessary to Live a Normal Life
You might actually be right about this one. Having credit cards and a pile of consumer debt is normal these days, as the stats above show. It may be normal, but it’s definitely not necessary.
You don't need to spend more for the things you want and need to live your life. It only takes a little more discipline and planning, but it’s worth it! Angie and I are living proof that having a plan and not using credit cards works, even when money is tight.
Quit Feeding the Debt Beast
There are plenty more signs that you’re letting credit control your life, but these are the top 4 that I run into most often when talking to my readers and teaching people about finances.
Here’s the deal, using credit cards and other forms of consumer debt may seem innocent enough at first. But a little here, a little there, add a car payment and a couple of emergencies, and soon you’ve dug a financial hole that's extremely difficult to climb out of.
The result is that you live life differently because you have more stress, less money, and less freedom because you have to keep feeding the credit beast.
Credit Doesn’t Have to Control Your Life
There is a way out. There is a way that you can stop being normal, and start being someone that has options, freedom, and much less stress because you have no debt keeping you in constant bondage.
I can tell you from my personal experience that you can achieve debt freedom, and it is absolutely worth it!
Yes, it’s gonna take some discipline.
It’s gonna take some time.
You’re gonna have to change some things. But that’s ok, that’s how you achieve your dreams.
It’s better than continuing to dig the debt hole deeper, year after year, never reaching the bottom.
We Did It, You Can Too
I can show you how to stop letting credit control you and manipulate you into a lifestyle of limitation. You can learn the techniques Angie and I used to get rid of all of our consumer debt and turn our financial life around permanently. My highly rated Celebrating Financial Freedom online course teaches you everything you need to know.
Click here to find out more about it.
You can also read these great books that have been a huge part of my debt free success over the years:
“Financial Peace” by Dave Ramsey
“The Millionaire Next Door” by Dr. Thomas J. Stanley
“The Blessed Life- The Simple Secret of Achieving Guaranteed Financial Results” by Robert Morris
“More Than Enough” by Dave Ramsey
Question: Has being in debt limited your life in any way? Leave a comment and tell me how.