Debt Consolidation

Money – From A Woman’s Perspective Volume 1, Number 2

Hi. I’m delighted that you’re here with me again at The Money Case.

“Your money is governed by how you treat it; it’s that simple. It thrives when you are being responsible, respectful, and doing honorable things with it. For many of us, debt is too big a part of our overall money picture not to give it the respect that it is due. How we treat our debt and the people who are a part of that debt play a major role in our path to financial freedom.” – Suze Orman – The 9 Steps to Financial Freedom (p 158)

After a tiring day, I decided to relax and watch TV, nothing in particular. I was soon struck by the number of commercials advocating that debt consolidation was my way to be debt-free. Is that so? I think that these companies are selling false hope. They are not going far enough.

Walking a mile in a debtor’s shoes, I believe that if my plan is to become debt-free by consolidating my debts, I must also have a budget in front of me. I ought to know how much is coming in versus how much is going out. In the absence of a budget, it’s a given that I’ll get into debt over my head, and need to consolidate all those credit cards, car loan(s), mortgage(s): first, second, and/or third, plus student loans, and other miscellaneous loans.

Since the subject of debt consolidation piqued my interest I started to notice numerous advertisements in the daily newspaper from companies specializing in consolidating debt. I then went on to read the help wanted section observing the various job ads from collection agencies - “that due to expansion” our [collection] companies have immediate openings…

Needless to say, I googled debt consolidation and came up with 33,000,000 matches; a lucrative industry, and growing every time I do a new search. The tools are there to help people get out of debt, but in my opinion it doesn’t go far enough. Yes, the companies will cut up our plastic, give us a manageable monthly payment, but the rest is up to us. We need money management. We need to start building and relentlessly using a budgeting system if we want to regain our peace of mind, and move on to be free financially.

What’s the cause of this phenomenon where debt consolidation and collection agencies have become such huge businesses? I’m not going to address this here because it warrants its own space. I’ll write about it in another blog.

What I do know is that once we decide to consolidate all our debts we must be vigilant about our money. As I said earlier, we have to know how much money is coming in and how much we are spending. So while we’re seemingly getting ahead of the financial game by paying off our debts, we need to simultaneously start a budgeting process. Yes, like at work; a compulsory process. Except for personal use this process is easy and fun. Budgeting has to be a part of our daily activities - like breathing. It’s that vital. The deeper we breathe the more energy we experience. Likewise, the more we become engaged with our finances the more freedom we experience.

The Money Case offers an on-line budgeting software that let’s us see how we’re spending our hard-earned money. Using this tool in conjunction with the desire that we all want to clear off our debts, we will begin to see a change in our lives – a change towards financial freedom.

Cause and effect. Suze Orman advises us to respect our money, handle it responsibly, do good things with it, and we will be carving our own path to financial freedom.

The next time I decide to relax in front of the TV, I’ll choose a commercial-free movie instead.

Have a debt-free week, and see you here again next Tuesday at The Money Case.



Debra