Taking away the Credit Card

Couples struggle with personal finances from the beginning of a relationship to the end.  Many, many arguments are over money issues and these arguments are exacerbated when the couple doesn't see eye-to-eye.  I hate to be around couples who are imploding over money and credit problems.  

It seems there are two types of money handlers.  Functionally it boils down to the savers and the spenders but there are many variations on the two categories.  

The characteristics of the savers:

• They don't spend money they don't have
• They save money for long term emergency planning and long term purchases 
• They like saving!  Having a growing nest egg in the bank is exciting.    
• The goal is to save money and not necessarily to ever spend it. The money will eventually be used for a necessity or for a planned project but always with the intention to build the savings fund back up
• Savings is the ultimate goal, the security fund, the reason you budget

The characteristics of the spenders:

• They spend more than their paycheck and feel it is okay - there is another paycheck coming
• You only live once so go for it!  If you want something today buy it who knows what tomorrow will bring
• They like spending and buying stuff is exciting!
• There are no limits - the goal is to make yourself happy by buying what you want now.  Money is for spending not for wasting away in a bank account unused
• Spending is the ultimate goal, the thrill of living, the point of earning money

Night and day philosophies!  Now try coupling these philosophies together!!

Two spenders:  

• credit cards maxed out
• no money in savings
• overdue notices on bills, having to choose which bills to pay and which bills to leave unpaid  
• Always pleasing yourself by spending money on yourself and your wants.

Two savers:

• Credit cards used only minimally and paid in full each month
• Lots of money in the bank
• All bills paid on time and in full to avoid interest charges
• Usually penny pinchers that find reasons not to spend.  Stuff costs too much, buy used instead of new, "do we really need it" mentality

One spender and one saver:

• One working to pay down debt, one working on increasing it
• One wanting money in the bank, one mad that money in the bank can't be spent
• One conscientiously planning to pay the bills first before the "I want" items, one who thinks personal "I want" items come first and the bills can wait 
• Turmoil, chaos, interpersonal stress.  One wanting the security of a savings fund to feel comfortable, the other feeling miserable because they can't spend what they feel belongs to them

Unless the two people can agree on a budget that satisfies both their needs and provides for some savings and some spending life is miserable all around.

Two extreme savers never have the joy of enjoying life and doing things that cost money.  Two extreme spenders never have peace of mind, they live from one paycheck to the next and never have enough money to do it all.  One of each saver and spender argue to the point of divorce, neither one feels fulfilled and happy with the earnings because they can't agree on what to do with the money they have.

 Sometimes out of control spenders need to have their credit cards cut up.  Sometimes extreme savers need to be shown there is more to life than money in the bank.

The solution is a compromise between the two philosophies and a consensus to create a budget with both saving and spending elements in mind.

Some guidelines for personal finance issues:

• Never spend more than your income.  Why?
• What you buy can be repossessed.  Your wages can be garnished.  Your credit rating goes in the toilet and your interest rates go sky high.  
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• Realize that you control your money your money doesn't control you.  
• Save a little, pay your bills, and then enjoy the fruit of your labor.  That way you are building a fund for your future, your daily life is under control because the stress of unpaid bills is gone AND you will have some money to enjoy living your life

Remember at the beginning I mentioned "I hate to be around couples who are imploding over money and credit problems"?

Well - the whole country is looking at a "couple" squabbling over finances at the national level, only it is not a couple it is the democrats and the republicans.  

• Re-read the characteristics of the spenders and think of the tax and spend democrats.
• Re-read the characteristics of the savers and think of the live within your means republicans.

Now do you understand the mentality of the players and the enormous philosophical differences that must be overcome before they can govern responsibly?

Spenders want to spend and savers want to save.  Big government proponents want bigger government and small government proponents want smaller government.  

The Bible has a verse that is applicable here.  The KJV of Amos 3:3:  "can two walk together, except they be agreed?"  Once you understand your philosophies are at odds with each other you have to find a way to build a consensus and develop areas of agreement. 

We are in fiscal danger.  If we don't want to be a bankrupt nation, unable to pay bills or take care of its citizens we need to rein in spending.   Let me be very clear once you begin to overspend if you don't stop overspending your money is no longer under your control.  Overspending leads to late fees, exorbitant interest rates, paying money back to one lender while building up a huge debt to another.  And it never stops.  Until you live within your means you are at the mercy of whoever owns your debt, and legally they own you because they can collect it at your expense with collateral and garnishment.  Yes, you can declare bankruptcy but you are still in the hole with a damaged credit rating and most bankruptcies require at least some payback.

Do we go over the fiscal cliff and spend, spend, spend or do we rein in spending?  Can we find ways to do the necessary cutting to bring us into living within the national budget?

My advice then to the Government Fiscal Crisis is:

• Stop deficit spending.  Never spend more than the taxpayers send in.
• Save a little.  Have contingency funds for national emergencies.
• Pay for the programs we need and don't borrow money from other nations to pay for our needs.
• Stop programs that aren't needed anymore and find ways to trim the ones that are needed.  That will lead to more citizens receiving quality services that we can pay for up front.

If we as a nation agree to understand and work with the spenders and the savers we can develop a consensus mentality not an us against them mentality.

Our future will be secure because there will be funds available to use for our citizens needs and national concerns.

Our daily life will be under control because the national debt will be paid down and eventually eliminated.  We won't owe a debt we can't pay and without paying exorbitant interest fees we can enjoy lower taxes.

America will be living within her means and her citizens will enjoy the fruit of their labor with a minimal tax burden.  The government in turn will have the money necessary to run a lean, trim, efficient government responsive to its citizens.

It can be done.  Its just that the spenders and savers must agree to do it together and with consensus.