My financial crisis plan: Don't borrow money
Filed under: Borrowing, Debt, Simplification
It's a credit crunch. A meltdown. A financial crisis! A banking collapse! While we're all panicking, what should we do? While Tracy Coenen points out that the credit crunch is overstated, I have to agree with Julie Tilsner, who suggests banning credit cards. But my plan goes even further: I don't want to borrow any money for anything. Not a major appliance "buy now pay in 2010!" plan. Not a new car. Not a home equity loan, a refinance with cash out, or anything.Having made all (or, well, many) of the financial mistakes a woman can make, I've vowed to only buy the stuff I can afford. If my dishwasher bites the dust (it did), I'll wash dishes by hand until I can find a good used machine for my budget or until my sister's erstwhile boyfriend installs the extra one he promised us. If my glass-top stove breaks (yep), I'll cook with the two burners whose glass wasn't totally shattered until I find the gas stove of my dreams on craigslist (anyone want to barter for homemade fig pear lavender jam?). If we need to get around town, we'll ride our bikes or the city bus. Need to go on a vacation? Need a new TV? No one needs these things. New school clothes? Goodwill. New roof? Guess I'd better start saving now.
I've learned that borrowing money when you're broke is only going to make you more broke in the future. The stuff I earnestly told myself was an "investment" has turned out to be just stuff, much of which wouldn't even move for a few dollars at our family's yard sale.
If only the nation's banks could learn that lesson. But they just borrowed money from their rich Uncle Sam. And you and I both know what happens when you borrow money from family...
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Reader Comments (Page 1 of 1)
10-05-2008 @ 7:53AM
DeRuiter said...
Clever girl! You're on the way, UNLIKE THE U. S. A., TO FINANCIAL HEALTH AND PROSPERITY. Once a person realizes that all that "I have to have this!" stuff is worth pennies on the dollar as you head out the door of the store, and that you can buy it for next to nothing at yard sales, you're way ahead. This also liberates you from the tyrany of shopping malls with pick pockets, and occasionally thugs lurking in the parking lots to steal your money, carjack you or worse. It's loads more fun to go yard saling on a Saturday morning to find that nice wool sweater ($2.00), those men's dress shirts in the needed size ($1.25 each, on the hangers, in plastic, from the cleaner's!), that stock pot ($1.00), coffee making machine ($2.00), new blender with glass container (splurging $5.00 because it's a Krupps), hot new novels ($1.00 each for the hardbounds), the pair of slightly used Versace jeans for a dollar which never fit well and were later sold on ebay for $14.36! Do not borrow for ANYTHING except your house and possibly a modest car. Whatever you need, it's out there in gently used or like new conditon, JUST START LOOKING! Ask friends, post a note on the supermarket's bulletin board, post a want on Craigslist or search it for what you need at bargain prices, check freecycle, AND COMB THOSE YARD SALES. Someone, somewhere, has what you need and will give or sell it to you cheap. PUT THE MONEY YOU SAVE IN THE BANK AND THEN BUY A CD. Save money, save the environment, buy better quality stuff with practically new money because it's gently used, AND NEVER BORROW MONEY OR CHARGE STUFF ON A CREDIT CARD. Remember to have a yard sale once a year and sell all your unwanted stuff! Waste not, want not is still true.
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10-05-2008 @ 10:09AM
getwau said...
This is despicable. How sad. I hope the Feds will be as willing to bailout hardworking Americans when we have financial difficulties - FAT CHANCE! You can only count on your family to look out for you. I discovered one of the best books you'll ever find about finance, "How to Become Filthy Rich on Your Current Income" at www.how-to-become-rich.com. If people read books like this one we wouldn’t have the
current situation we do.
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10-10-2008 @ 7:20AM
PeeKa said...
Yes, the biggest pain is to save money...
http://peekablog.net/2008/10/what-caused-the-financial-crisis/
Regards
Peeka
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10-11-2008 @ 10:00AM
shubhro dutta said...
On the back side of my Bank Pass Book ( an account statement of Bank in modern day parlance), I found the following lines:
" if you buy things that you do not need, then one day you will need things that you cannot buy".
for those of us who indulge in reckless consumption and "buy today pay tommorow" model of living, these words might sound like jurrasic rustic wisdom.
But dig deep without prejudice, and it will start to make sense.
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11-06-2008 @ 1:02PM
Ray said...
Have you ever concidered using cashloancity.com ? We have and we do recommend them!
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12-02-2008 @ 10:58AM
Penny K said...
Well done. Had to do same (though had that example from some family in childhood) as single parent and as poorer older person.
It's just fine once you accept the realities..."buckle down" they used to call it. A tip that really, actually works: think about what you need, and why you need it. Figure out what you can really afford no matter how ridiculously low (down to free). Pray or meditate on all factors,including hauling/installing limitations, acknowledging someone else might be able to pay more but you can't because of other obligations that matter, ie children's needs etc...Repeat until you feel a "click", like the universe has heard and is saying, I heard you. Go to sleep on it, and start keeping eyes open next day and thereafter. Go to any place you feel an urge to go even if it doesn't seem in any way related, and speak up about what you are looking for...You will find what you need.
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