bankruptcy « The Debt Dance

Don’t believe that being broke, being in debt, feeling hopeless is just how your life “is.” If you want more money do understand that you can have and do anything you want. Remember, with kids, dogs, spouses, and life, you generally get what you expect.

Don’t wait to invest. There is no perfect time and time is what will make you rich. If you want to be rich do take some of the first dollars you receive every payday and invest them–even if you have to eat beans for a week. Invest what you can.

Don’t invest in stocks or businesses or ventures that you don’t understand. If you want to make money Do put your money in places that you can explain to a child.

Don’t expect, or assume, that someone else will take care of you. Your company or the government may let you down. Do fly your own plane.

Don’t give up on saving if long-term methods don’t work for you. If you want more money Do try a short-term method, e.g. work for six months to save enough to put a down payment on a small rental property. Have yard sales, sell on ebay, house sit, plant sit, babysit…anything for a short run to accomplish your important short-term goals.

Don’t buy a franchise–unless you talk to a bunch of franchisees (from the company you’re interested in) and determine if it’s a good deal. Usually the only person making money in a franchise is the franchiser. If you want to start a business Do investigate doing the business on your own if you understand the in’s and out’s and if you can acquire the materials and knowledge to pull it off successfully.

Don’t buy in season. This is an old adage but bears repeating. What this does require is postponing buying what you want right now in order to use your money to purchase something you will use six months from now. But the savings are enormous, and if you use these savings to do something remarkable with (not just buy more burgers and fries) you will come out richer. Let’s assume you are a family of five and that you spend an average of $2,000 on clothes per year. Let’s also assume that you are able to buy out of season most of the time and you save a sum total of 50%. This will free up $1,000 per year. When you invest this, over 20 years you will end up with about $58k. Just by shopping smarter. If you want to save money and accumulate wealth Do buy swimsuits in September and mittens in April.

Don’t put all of your eggs in one basket. If you want more money, and more happiness, Do diversify–your income (don’t depend on just one source), your investments, your interests (enjoy the football game and the symphony), your routine (go to new places, do new things.)

Don’t accept credit card debt as an impossible foe or a way of life. Do get out of that high-interest monster debt any way you can: earn extra money, negotiate with the companies, start a flea circus, sell your blood, file for bankruptcy–just find a way and get out.

Don’t ever charge an event that you have control over, like a vacation, a party, or a wedding. Even if you’ve made the reservations. Even if you’ll disappoint people. If you want to save money, a lot of money, Do find a way to have that experience that you can pay cash for.

Don’t assume your time has no value. If you spend hours clipping coupons, shopping all over town to save five or ten dollars you have missed the boat. If you want more money Do spend your time on building income and assets and rich life experiences. This takes no talent by the way–anyone can do it if she just finds the right method, the good fit.

Don’t underestimate the power of giving. Virtually all successful people in our world give generously. Giving enriches our lives, makes our world a better place, and…there’s that whole karma thing. Every time my family gives we have amazing things start to happen in our lives. Do give. When times are the toughest give more.

Don’t let your house or your cars fall into disrepair just because you’re low on money. You may have an opportunity come up where you need to sell your home quickly. It doesn’t have to be the Ritz but if the pipes don’t leak and there’s fresh paint on the walls you have improved your investment and made yourself able to respond faster. Do be flexible and able to jump on opportunities.

Don’t stop paying your insurance just because times are tough. Insurance can be a life-saver–literally. Do find cheaper ways to keep basic insurance coverage including higher deductibles. If you move from a $500 deductible on your car to a $1,000 deductible just be prepared with a credit card you only use for such emergencies that has a $1,000 limit.

Don’t marry for money. As Dr. Phil says, you’ll earn every penny. If you want peace, Do have your own income, your own assets. (One of the main reasons women stay in abusive relationships is that they don’t have the money to leave.)

Don’t accept or apply for store-issued credit cards. The credit limits are usually low and you can run up the total with just one or two purchases. This looks like-to the credit bureaus-that you have maxed out your credit. If you have to use credit, do use a card with a larger limit, buy the thing you absolutely must have (like a new ‘frig–not clothes, or shoes, or golf clubs). This then is seen by the credit bureaus that you have considerable available credit and improves your credit score.

Don’t live a miserly, penny pinching life! If you want to be rich Do enjoy every moment, every day. Who wants to be on his death bed and look back on the great deal he got on toilet paper? Live until you die–that’s truly being rich.

Don’t stick your head in the sand. This can be a very costly mistake. Do make your money work for you by keeping on top of it at all times, by learning the best methods for you to manage and multiply those dollars. Take charge.

Don’t buy anything impulsively that costs more than 10% of one weeks’ income. Do, on occasion, buy something that you can afford and that you’ve always wanted, and/or just knocks your socks off. (That’s an autographed Albert Pujols baseball by the way. How fun would that be?)

Don’t go it alone. Do seek the help you need to find peace in your life. Most of the time we get into debt because of deep, psychological issues that we struggle with all the time. A little therapy can go a long way in changing behaviors and misconceptions.

Don’t ever loan people you care about money. A personal loan hanging over the head of a relationship will damage–and even destroy–it. Do give people money if at all possible. A gift. “No need to pay me back…I’m good. Makes me happy just to be able to help you out. Maybe you can help someone else out someday…”

Don’t buy or borrow in the heat of the moment. In these tough times people are signing up for “how to get rich,” “how to make millions in foreclosures,” “how to make millions on the internet,” types of seminars. The “free” seminar of course leads to you buying a package of information “that you can only get, right now, right here…” These are examples of frenzied spending that 99.9% of the time we regret later. If you want to save money Do give any significant purchase time. Cool down. Investigate. In most of these information-selling programs you can find out the information on your own. Pay a seasoned real estate investor a hundred bucks to tell you their experiences, etc.

Don’t buy something to feel…superior, loved, smart, desirable, rich, fulfilled, excited, entertained. Do buy a shovel to dig a hole, buy a coat to stay warm.

Don’t carry your credit cards with you. If you have trouble with debt carry a credit card is like giving a gambling addict a house next door to the casino. It’s just too easy. If at all possible cut the damn things up. Do keep a card available for emergencies.

Don’t do bill consolidation. There is a large upfront charge (usually around $800), the company does not negotiate with the credit card companies they simply work within the credit company’s policies (I had a counselor tell me this after I pressed), so you probably won’t see much of a rate decrease. You will, however, be paying the company a fee every month for accepting your money. If you want to get out of debt Do set up your own get out of debt plan, do negotiate with the companies, and, if you really can’t make it, talk to an attorney about bankruptcy.

Don’t ever co-sign on a loan. Ever. Do help your friend or family member find another solution for the problem.

Don’t refinance, especially to pay off credit card debt. You’re eating up the equity in your home–which you will need some day. You will be paying all kinds of fees and points and crap (because the companies aren’t refinancing you just for fun) that you get absolutely nothing for in return. What you do end up with are credit cards that have zero balances. Guess what you’ll do next? What you have always done, justify charging something, and something else… And before you know it they’re maxed out again and now you have a larger house payment and no equity. If you want to accumulate wealth Do see your home as an untouchable asset.

Don’t hold onto possessions as if they’re your first born. They are just “stuff.” Enjoy what you have, keep it in good condition, display it proudly, but do feel, and know, that you can seperate from it at any time. Stuff is just stuff. It is not life.

Don’t take out student loans. Ever. Under no circumstances. They are the only debt I know of that cannot be wiped out with bankruptcy. They will garnish your wages, your social security, your disability check. Student loans have been accepted as the way to get an education in our country for so long that people don’t think twice about it. But what happens if you take out loans and don’t finish school? Or you don’t get that dream job after you get that master’s? Do lots of research on how to pay for college. Plan far ahead. Go to school part-time. Get your pre-requisites done at a cheaper college. Get your education on your terms.

Don’t let your circumstances drive your life. “I’ve got a car loan, a mortgage, credit card debt, a student loan, and alimony to pay. I’ve got to keep working in my job even though I hate it. I hate my life…” Do let your dreams, hopes, and desires drive your life. “I’m quitting this job in nine months–I’ll have my credit cards paid off by then if I really focus on it, I sold my car yesterday and bought a car for cash, I’m taking a job on weekends to pay off my student loan. In nine months I’m taking my dream job–at last, at last!”

NOW HERE ARE SOME FUNNIES:

MELANIE (age 5) asked her Granny how old she was. Granny replied she was so old she didn’t remember any more. Melanie said, ‘ If you don’t remember you must look in the back of your panties. Mine say five to six.’

STEVEN (age 3) hugged and kissed his Mom good night. ‘I love you so much that when you die I’m going to bury you outside my bedroom window.’

BRITTANY (age 4) had an ear ache and wanted a pain killer. She tried in vain to take the lid off the bottle. Seeing her frustration, her Mom explained it was a child-proof cap and she’d have to open it for her. Eyes wide with wonder, the little girl asked: ‘How does it know it’s me?’

I welcome your comments! PLEASE CLICK THE TITLE OF THIS ARTICLE TO COMMENT.