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Tuesday, 20 November 2012

To the young and not so young--on debt

If you are in debt, get out of debt. If you are not in debt, do not go into debt. The American government will demand payments for college and university debts. And, those who are debt-ridden will find themselves in greater danger of any independence, politically, in the future.

Some people, even Catholics, have told me that it does not matter if one borrows more money on the edge of a national fiscal melt-down. It does. Just as for years priests have not told youth that getting drunk is a mortal sin, so getting bogged down unnecessarily in debt, in order to live a certain lifestyle, is wrong.

I am not writing about necessities, such as medical expenses, but other things not really needed.

I am concerned about the soul of Catholics burdened by debt. Pray and act responsibly. I am convinced that exorbitant university debts must be avoided. To be in slavery to a government or institution connected to the government is dangerous.

Stop using a credit card. Go to local, community colleges if at all possible. Wait and work first even if the work is menial, as that is honourable as well. I am afraid that people think there will be no consequences for their debts in a complete economic rout. We have to face a Just Judge. Good stewardship is not merely being green or tithing. It is the courage to live a lower lifestyle than one may want. It involves the courage to be poor and seem poor.

Many of decisions on money will be made this week as it is the busiest shopping weekend for Christmas in the States. Pray and talk to your family about expenses. Be honest. Make things. Do something together which is not over-the-top. For your soul and for the greater good, do not go into debt this Christmas.


Bill Meyer said...

We are, at present, shopping to refinance our home. Unlike many, we are in good shape, our home is worth more than we paid (for now) and we've made good headway on the remaining debt. But now we are in a position to seriously consider a 15 year term, which will, with the substantially better rate now available, save us over $100K over the term of the mortgage.

People need to realize, among other things, that interest on even a small loan accounts for more debt than they probably understand.

We have lived for years with no credit card debt. We have and use the cards, but all are kept current.

In the face of what is coming, I cannot say we won't be hurt. I can't even say we won't wind up on the street. What I can say is that we are doing the best we are able to minimize our exposure.

Supertradmum said...

Great, Bill. but you are one of the intelligent and responsible ones...

Anonymous said...

I couldn't agree more! Firstborn is in her last year of high school and is choosing the local community college because we've been hammering it into her head for so many years that she shouldn't borrow. We want our children to learn from our mistakes, as we have not always been wise.

It amazes me how many otherwise intelligent and responsible adults believe that college loans are okay. They are not. Not anymore. The job market is too hard to justify college debt.

Yes. Local universities, menial jobs, live at home. A debt-free start to life is the best (temporal) gift I can give my children. I cannot afford to write a tuition check for a big university, but I'll willingly support them in their day-to-day expenses, if it helps them maintain their autonomy from government or banking institutions!


Emily said...

It is possible for you to go to college sans debt. I attended a local private college with no student loans. This was possible because my parents and I talked when I was a high school freshman. I knew how much they could give me, and I knew that if I wanted to go to the private school, I had to get the rest in scholarships, which I did. It is entirely possible to avoid debt in college, as long as parents are upfront with their kids about what they can afford (or not) to pay, and if the student investigates all the avenues of aid available BESIDES loans. I also lived on campus, because that was cheaper for my parents than buying me a car.
It comes down to thinking ahead, planning, and being honest with your kids.

Supertradmum said...

Emily, I agree and my own son managed no more than a debt after four years of 5,000 USD, which is now almost gone. There are ways.