When we were younger, we were always given some basic advices on how to properly improve our financial situation. Some of them are related to “loan”. Loan is considered as a preferred mean to acquire new assets rapidly and it is even seen as a tool to achieve good credit score. Our economy is based on the acquisition of more debts, although they are often seen as the culprit of many financial issues. Some experts even clearly argue that the more debt, the better. Obviously, loans offer an opportunity to acquire new home, car, appliances, furniture and others. They could also make numerous occasions, such as wedding and exotic vacations possible. However, older generation sees that it doesn’t make sense how people could rely so much on loans. Back then, people would save before they purchase something and the new approach to debt could create rather massive ownership of debt. Although loans could provide us with some conveniences in life, it could also bring us more stressful lifestyle
Unfortunately, debts could also make our lives more stressful if we fail to make the payments. Keeping up with the expenses is challenging enough without the addition of debts in our lives. In this case, we should avoid having a life with constant worries due to debt problem. Bankruptcy and other debt problems always reach all-time highs with every new economic crisis. However, new movements are gaining momentums and they designed to help people better improve their lives, despite debt problems. The truth is, the myth that debts can be used to create prosperity is more prevalent among working class.
In essence, debt isn’t dangerous and shouldn’t be avoided; but one of the biggest mistakes is that when people receive money for the first time from lenders, they tend to think it is their own. Many people are happy when they are first approved for a loan. In reality, we should feel somewhat concerned when we are dealing with debts and we should have long-term strategy on how to defeat them. In fact, it takes courage, discipline and even sometimes, a bit of luck to slay the horrendous debt monster. This could feel like a monumental task, but we should assure ourselves that we can do it.
We should be aware that even the smallest debt could eventually develop into a kind of living nightmare. The fallout of debts problems can be quite severe. Many people have ruined peace of mind, poor health, destroyed marriage and loss of productivity at work due to significant debt problems. We shouldn’t be fooled into thinking that with bankruptcy; we have another opportunity to start over. Often, it is not so easy and very serious debts could actually cause life-long damages into our finances. Fortunately, it is perfectly possible to avoid many bankruptcy cases, often with helps from certified professionals. This should help us to get back on our feet again. The process could be painful and we may need to relinquish some luxuries, but lawsuits and foreclosures could have more serious consequences.