Years ago, most of us were taught to take a portion of our earnings and save it “for a rainy day.” This was based on the assumption that if unforeseen things happened, like loss of health or employment, you would still be able to survive using your financial savings. Saving for a rainy day meant just that, having actual savings that could easily be turned into cash when necessary.
However, many people today have redefined savings as having one or more plastic cards, (credit cards), with an available credit line equal to or greater than the amount of savings needed for a rainy day. Hence, the reason why so many people are in debt over their heads. Many do not understand that they are in debt because they have experienced more than one rainy day.
In today’s economy, it is not only possible but probable for everyone to experience more than one rainy day. In my opinion, the 21st century goal for savings should be renamed the Rainy Day(s) fund. Once you realize that there will most likely be more than one rainy day, it will be obvious that the solution cannot continue to come from plastic, i.e., credit cards. The more you use plastic to solve your financial issues, the deeper you sink into debt, just like quicksand.
Meanwhile, the income you should be saving for rainy day(s), you are spending since you are depending on the credit card(s) to bail you out when necessary. Before you know it, you are in what I call “Plastic Slavery.” The money you should have set aside from your already taxed earnings, you have spent on other things. Now the rainy day has arrived and even though you have a credit line, maybe unlimited credit, you will still have to pay usury/interest along with fees for late payments, increased interest rates and possibly remain in debt for 30 years or more.
Plastic credit can be a convenient tool for those who can afford to use it without having to pay interest payments. Begin to recognize the New Millennium forms of slavery and do not become a voluntary captive. Some of the interest rates being charged for plastic credit were considered loan shark rates years ago. Even though there have been new laws and procedures required of lenders regarding truth in lending, you almost need a college degree to understand the language. Millions of people still don’t get it. Sure hope you do, for cash sake. Don’t miss Part II.
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