Author: Jo Ann LeQuang
Email: joann @ leqmedical. com
Debt is the sort of subject that people keep to themselves.
There is a lot of interior monologue going on about debt,
but not much real conversation.
In that kind of climate, a lot of wrong beliefs can spring
up. While some mistaken ideas about debt may be academic
matter or of not much consequence, some can be serious.
In fact, to really tackle your debt problem you have to
understand it. Part of that means understanding your own
spending habits and personal situation. I can't help you
there.
But the other part means understanding debt and how it
works.
Here are seven common myths people believe about debts.
The first: debt is a recent phenomenon.
Many of us think that it is our modern, overextended
lifestyle that contributes to debt and that in ancient
times, people just did not have the same problem with money
that we do. That's not true. Provisions for bankruptcy
protection appear in the United States Constitution (1763).
Debtors' prisons were common in the industrial revolution.
And in Biblical times, people who were in debt might sell
themselves into slavery to appease a creditor. The truth is
debt has been around about a half hour after the creation
of money.
The second myth: debt shows a lack of character.
Now it is true that a disreputable person can easily get
himself or herself into debt, but debt is not in and of
itself a character flaw. Debt occurs because of a
convergence of unfortunate financial circumstances. This
may be avoidable or unavoidable. However, the debt that
results does not prove anything about the person who has it.
Debt is a problem, but it's not evidence you are a failure.
The third myth: debt is just something you have to live
with.
This is a dangerous myth because debt is like a bleeding
wound. You really cannot afford to leave it untended too
long.
I sometimes think that debt is a lot like obesity. If that
is your problem, you have to fight it. You can't afford to
ignore it or pretend it's not a problem.
Debt robs you of your future prosperity; it drains the
resources you and your family need.
The fourth myth: everybody is in debt.
It's easy to see why people believe this, because so many
people are massively in debt. But do you know what? A good
many people have no debt. In fact, the majority of people
in the U.S. have manageable amounts of debt in proportion
to their incomes. Overwhelming debt is not something most
people deal with.
That's good news if you have overwhelming debt. Do you know
why? It means it's possible to live another way. In fact,
most people do. If they can do it, so can you!
The fifth myth: it takes forever to get out of debt.
That myth is true if you just wish you were out of debt or
you have some lackadaisical approach to it. Do you know
that there are coaches who can take an unfit person and
train him or her to complete a marathon in six months?
People can lose 100 pounds in a year. Some people can make
a fortune or complete a degree in four years. The point is
that great things can be accomplished even in unlikely
individuals if you do two things: get a plan and follow the
plan.
People have paid off very large debts in fairly short
amounts of time with the right plan and coaching.
The sixth myth: debt doesn't matter.
Fortunately, this one is not as common as some of the
others. However, it's very destructive. Typically, people
who buy into this myth grew up in households that were very
comfortable with high amounts of debt. This does not always
create the proper perspective for future financial security!
Debt wastes large amount of your money and can cause your
family to burn up high amounts of income on average-levels
of lifestyle.
The last myth that people believe about debt is that you
can't handle debt (you need to hire an expert to help you).
It is true that there are lots of people and businesses who
specialize in helping people with debt. But be very
careful. To enjoy good financial health, you have to learn
how to take care of your own money.
This means that handing over a large amount of money to a
debt company that promises to take care of your problems
(so you can walk away) may be a dangerous decision. Here's
why. If you don't understand what they're doing with your
money, you are giving them a good opportunity to rip you
off. It can be the financial equivalent of handing your
wallet to a stranger and saying, "Take what you want."
Second, if you don't know how you wound up in debt, you
won't be able to get out.
Debt consolidation is an approach to handling debt but it's
a term that is frequently used carelessly online.
Technically, debt consolidation just repackages or
reorganizes debt in a way that makes it more favorable.
However, many companies who offer to settle or negotiate
your debt (get your creditors to take less than you owe)
call their services debt consolidation. There are a lot of
myths out there about debt and how to manage your debt. An
education can be the best defense!
About the Author: Want to get straight talk about debt consolidation? Visit
http://www.mydebtco nsolidationanswers.com . For a free
report on your financial style, visit
http://www.debt- consolidaiton- diva.com .
