Spending money feels great – after you have sorted out your food, clothing and shelter, it is time to spend on luxurious items.
And boy, shopping is addictive. You go on to the store, you window shop for 3 hours and then buy 1 item. Go to the next store and repeat the process. Sometimes you buy things because you like it in that instant. Not because you want it but it seems nice to have and you spend your money.
At this point, you would have bought few things like games, high end clothing or food which will serve you. Also something which serves no purpose to you.
Saving money isn’t sexy. You feel that you are doing yourself a disservice because you have the money but are not using it to flex like other people do.
The peer pressure to buy many things, show off or at least have the same things builds up. And although you have been taught to not give in social pressure, you buy that new bike because your neighbor or friend bought one.
Happiness is a point of view and if you want to feel less happy the easiest way to is look for things others have and you don’t. Dive into the mindset that you need those things to be happy and boom you can become sad.
How you feel is a measure of things how you interpret things around you. It can work for you or against you and only you can decide on that.
Credit And Debit
When you shop through a debit card, there is a limit to how much you can spend. Because your card won’t go through if there ain’t money.
So if you buy the stuff that you need and invest in things for future, you can probably spend guilt free. Because your shopping won’t cut through the money for other things. And better your net worth won’t go in negative.
But when you have credit card, you can shop more than the money you have in your bank account. Of course, you have to pay the money back. However the maths had gone out of the window.
Because now you are constantly living in debt. The future credit is enticing and therefore you take credit card, loans and it helps to a certain extent if used smartly.
But for many people, who take such credit without thinking end up in huge debts which attracts interest. And they end up in a cycle of never ending paying money.
Right Or Wrong
So what should you do?
Credit is a good thing. And you should build upon that. Take small credits and pay them. It helps build credibility so when you need real emergency funds, people will give you credit.
But if you use credit for things unnecessary then it might build up a habit and can backfire badly.
Taking big loans for home should be avoided. Because most of the times you end up paying way more and the loan cycle is for 30 years. So for 30 years you are not the legal owner. It’s like you are renting but you have headaches as if it were your home.
By the time, 30 years had passed – you will become the owner but the home is old and needs an overhaul.
If you still need to buy a place, if you can pay back the loan amount in 10 years only then it makes sense. Or it doesn’t. And renting a place is probably a better choice for many people anyways.
It all comes down to how you will handle the credit you deserve, get and build. The more strategize you make it, the more rewards will flow – else it can become a big nightmare for you.