Personal Finance 101: Money Saving

We are a nation of debt. Millions of people today will apply for new credit cards and loans that they cannot afford to payback but need just to stem the tide of negative cash flow in their homes today. With this debt comes a personal finance battle over who gets what and when. The mortgage company comes first. They are followed by the car loan company. They are followed by the credit card used to pay for food and gas. And then families attempt to pay the full balances on their utility bills. This all, not to mention, the desire to give an offering or donation to their local church or synagogue.

This financial plan is no plan at all. Today families are suffocating under the monsoon of bills, debt, and unexpected expenses that happen every day to thousands of hard-working, yet financially deficient Americans. Studies have shown that an increasing number of homes are entering foreclosure in the last five years because families borrowed more than they were reasonably able to pay back. And yet, we as a nation continue to borrow, believing that one day it, being our personal financial ledger, will one day get better.

What we need more than anything else is a reality check of where we are and where we will ultimately end. When it comes to personal finance we must be honest with ourselves about how much money is coming in through our jobs and how much our expenses are down to the last penny. This assessment will mute the cavalier attitude so many people have because they are unwilling to confront the purple giant of debt living on their personal finance ledger.

When it comes to tackling this elephant the one thing that is given is that you cannot devour fifty thousand dollars worth of debt overnight. You did not spend fifty thousand dollars yesterday so it is wishful thinking to believe you could pay all that debt down in a short period of time. Imagine for a moment that you looked in the mirror one day and realized you had gained twenty-five pounds. It might be shocking at first. But the truth is you have been in denial for a while because your pants stopped fitting you three months ago.