I’ve been reading a lot lately about the recession (you know, the one no one wants to admit is here) and the economy in general – banks and interest rates and credit, oh my! And I can’t help but feel one of my rants coming on about spending more than you make, using credit cards to “get by” and the false idea that gets passed around suggesting you need credit cards in order to have a good credit score.
Writers don’t make a fortune, with the tiny insignificant exception of the very very few who make the news, most of us ain’t gettin’ rich doing this. So it’s time we got smart.
First of all, let’s tackle that last one – the Credit Score.
Did you know that the idea of credit cards being necessary to keep a good credit score is a Lie fed to us all by the very people who invented credit cards ? You’ll hear it all the time, from all sorts of places. Your hairdresser will tell you she heard it on the news. You’ll read about it on Yahoo. That guy in the next office swears he was told by his banker that it’s true.
It’s a lie.
Your credit score is based on your ability to pay your bills on time, incur no late fees, and have no collection agency reports against you. That’s it. It has nothing to do with being loaned money and paying it back, which is also misleading. Do you pay rent or have a mortgage? Do you pay the power bill on time? Do you get a cable or satellite bill every month? How about your internet, or natural gas, or maybe you pay car insurance or have a car payment.
You pay those on time, never bounce a check, and not one of those companies has sent you to collections? Then you have an excellent credit score. And by the way – they’re loaning you money by way of services. You got a month of cable before paying, same with electricity, the internet, all of it. You used their service for a month, now you’re paying. So they’ve loaned you service, trusting you’ll pay it back.
Another pitfall that I see all too often, and was starting to notice in myself before I was able to change my life around, was the Emotional Spending.
It’s not limited to women, in case you were thinking that, but I’d be willing to bet we lead the percentages. You’re upset about something, usually it’s the fact that you have no money because you have too many debts, so in order to make yourself feel a little better, you go out and buy yourself a “treat”, and you charge it.
Huge Red Light people. Huge red light.
This is exactly what they mean when they say Money can’t buy happiness. It’s not a saying geared toward making you stop buying Lotto tickets because suddenly becoming a millionaire won’t add pleasure to your life. No. What it means is – if you’re depressed – spending money ain’t the cure. Buying a new sweater with your VISA isn’t going to cure what ails you. Pulling out that Mastercard so you can walk home with new candlesticks for the dining room table will not make the depression go away.
It’s a trap that will quickly become a death spiral if you don’t recognize it and stop, now. Imagine how much happier you’d be if you didn’t have all that debt that was bringing down your spirits in the first place?
Getting out of debt is hard, and it won’t happen over night. Like trying to drop 50lbs, it took you years to gain the weight, it’ll take some time to make it go away. It requires a change in attitude, some determination, and the will to stick to it.
But the biggest change is Spend less than you Make. Like eating less and exercising more, if you spend less, you can save more.
So what are you going to do with your Economic Stimulus money? Do you see it as the down payment on a new computer? Maybe an HD TV, or that nice riding lawn mower you’ve always wanted? If you use your government cash as a down payment, you’ll end up spending more than you were given. If you run out and spend it, are you buying something you honestly need, or just want?
Mine’s going into a savings account that I set up to be hard to get to – it can’t be accessed via ATM, and if I really want some of that money, I have to fill out a slip and go IN to the bank. I can’t transfer funds electronically or simply spend it on an impulse, and that’s the whole point.
Sometimes we need to set up road blocks for ourselves, for the better. Other times, we just need a change in old habits.
Think about it. Educate yourself on the difference between Need and Want in your life, and remember – Writing is free. It doesn’t cost us a thing to create novels, and aside from a little postage for some queries, and some blood, sweat and tears, it doesn’t cost a thing to get published.
So get to writing! We want at least some of that Economic Stimulus money spent at the bookstore, after all 🙂