If anyone spends too much and falls into temptation to take on unnecessary debt their lifestyle and leadership ability will be effected. The reason I say this is that I have managed many people that were under financial constraint and have myself been in financial difficulty and it always results in my thought process being occupied with how to get more cash.

It is like a leach that sucks on too you and doesn’t let go. Scientific studies have shown how debt can impact emotional well being as well as the family environment and that alone should be enough to keep people away from getting into debt, yet it doesn’t. Slick advertising keeps peoples minds off cash flow and somehow convinces them that the new phone, the new car, the new house will give them something spectacular. In some cases it’s the harmless clothes account where the unsuspecting victim doesn’t realize that not only are they purchasing clothes that may have a 200% mark up to begin with but also that they are now paying at a minimum 25% interest on the loan they have taken which ultimately they never pay off.

A person that ensures that they have a minimum of three times there monthly salary in a savings account for unexpected events such as a loss of a job, a broken fridge or a medical bill, will always sleep easier at night than the one that has no savings.

I would also like to encourage those that are looking to finance a car or house not to purchase up to the maximum they can afford as they are then not allowing any breathing space. If the interest rates go up the ones that borrowed to the max will certainly struggle to afford the minimum monthly payments and as such may be tempted to take on additional short term debt as a stop gap. Problem is this temporary assistance may be the straw that broke the camels back as when the funds run out they now have to worry about the house as well as the short term debt. It would have been better to renegotiate terms than take on short term debt that is heavily overpriced in terms of interest rate.

All this pain could be avoided if you simply live within your means, save monthly and don’t try to keep up with the so called “Joneses”

God bless