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5 Reasons Why You're In Debt Up To Your Eyeballs

If your MasterCard is mastering you, read on.

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woman shocked at credit card statements
Alamy
By Ginger Dean

We've all seen the LendingTree commercials where the guy sarcastically says: "I'm in debt up to my eyeballs. I can barely pay my finance charges. Somebody help me!"

If that sounds like you, read on. Here are a few reasons why you're swimming in debt and what you can do about it.

No spending plan. Without a plan or financial goals, you're headed down the road to digging yourself deeper into debt. A spending plan establishes goals and principles. If your goal is to save $20,000 for an emergency fund, then you need to avoid more debt along the way. Since debt must be paid back, it would take away from funding the $20,000 goal.

Keeping up with everyone else. Your neighbor just pulled into his driveway with a new Ford Mustang, and you immediately think about buying the new Infiniti luxury sedan. That's what we know as keeping up with the Joneses. But it doesn't stop there. Your sister tells you she just picked up the latest purse in the Louis Vuitton spring line, and you think about that Chloe bag you didn't really want until now. We do this to ourselves because we don't want to feel we're missing out on the finer things in life. But what we miss is the reality of the Jones' financial situation. If they're living on credit, you'd never know because you're so blinded by their bling. Take a step back and assess the real reasons behind your newest impulsive purchase, and then take action.

Lack of discipline. Just as you begin to think about purchasing a new car because your neighbor recently bought one, hopefully you have enough restraint to consider the impact on your spending plan. If your goal is to get out and stay out of debt, then discipline will play a major role in your daily financial life. Financial discipline will help you assess your goals and consequences when faced with a decision that could potentially take you off the plan. Discipline is your friend. Embrace it.

Buying a new car every few years. Remember the car your neighbor bought? Well, let's just say you're about six months from paying off your current vehicle, but you've now convinced yourself that it's time to get a new car because "I deserve it."
This is a classic reason why so many people dig in and remain in debt. Most people relish the idea of not having a car payment, and others relish the new car smell and feel every few years. You must decide what's more important to you -- living a debt-free life or cruising in the latest model.

In your world, credit is king. You enjoy a little retail therapy because you've had a hard week.But your bank accounts are overdrawn. Not to worry, you've got good ole MasterCard coming to your rescue. The problem? Your cards are mastering you and not the other way around. You've become so addicted to the plastic that you hardly recognize your spending plan anymore. As with the guy from the LendingTree commercials, your life is largely financed by your debt. But it's driving you crazy and will cause many sleepless nights ahead.

Here's the thing about getting out of debt: It requires a strong but realistic spending plan that you can stick with through the end. This is a "living" plan that will change along the way, but that's the beauty of it all.

Forget keeping up with everyone else, and cut up your credit cards. Spending your time trying to impress people who don't factor into your bottom line is a waste of money and will impede your financial goals. Assess your financial goals, and decide if having a new car is truly worth the money spent. Remember, it's no fun being stressed because your finances are out of control. Take control now, and enjoy the fruits of your efforts along the way.

Ginger Dean is a licensed psychotherapist and founder of the personal finance website Girls Just Wanna Have Funds.


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48 Comments

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paradise1941

why I cant email it?

November 12 2013 at 8:38 AM Report abuse rate up rate down Reply
Nasir Mohmood

my friends mom just got an awesome 9 month old Mercedes GL-Class Diesel browse this site ...www.jobs59.com

October 14 2013 at 6:28 AM Report abuse rate up rate down Reply
Cindy

I have not been clothes shopping for months now. But with the change of weather, I checked my closet to see what I had for winter clothes. I pulled out a favorite shirt that somehow was stained and after washing it a few times, I realized it was time to throw it out. One of my favorite pajamas got ripped in the wash. I had to throw it out. One of my pants has aged badly and doesn't look presentable anymore. I had to go to my late mother's gravestone unveiling and I had nothing appropriate to wear.
These are some of the examples of why I went shopping recently. I bought two pairs of jeans, two shirts, and a jacket. And yes, a spent a few hundred dollars.
Sometimes expenses come up and you just have to bite the bullet and charge it.
I don't often do this anymore. But I needed winter clothes to wear.

October 13 2013 at 8:58 AM Report abuse rate up rate down Reply
Tom Harrell

Skin Cancer-------------------------Dislocated Shoulder----------------Wall Street BUST of 2006----------------------Blown CLUTCH on my Pick up--------------------------Cost of Living going thru the ROOF---------------------That\'s MY 5.

October 13 2013 at 8:52 AM Report abuse rate up rate down Reply
bookbuyer1

A 5th grader understands the concept. If you spend more than you bring in, you are in debt. If you bring in more than you spend, you are not in debt.

October 13 2013 at 8:45 AM Report abuse rate up rate down Reply
ectullis

I am not better off than I was five years ago and it will only get worse. OMG

October 13 2013 at 8:39 AM Report abuse +1 rate up rate down Reply
2 replies to ectullis's comment
Cindy

I was better off 5 years ago, but not now. And you are right, it will get worse.

October 13 2013 at 8:59 AM Report abuse rate up rate down Reply
vlady1000

I am better off than 5 years ago. Make less at work and have less benefits than before, but was able to position myself to take advantage of the opportunities that presented themselves in the last 3 years that are now, and will continue for many more years to come. When times were good, I saved. And that is what allowed me to do this.

October 13 2013 at 5:22 PM Report abuse rate up rate down Reply
ncaok

Yuppies.

October 13 2013 at 7:47 AM Report abuse rate up rate down Reply
toosmart4u

I pay my bills including my taxes and I have lots of money left over to save for my children and grand children. I shop on line to buy american products because I am a proud American and voted for Obama twice.

October 13 2013 at 6:28 AM Report abuse +2 rate up rate down Reply
radareastbay

lol lol just follow the leader of the debt world barack obama. just follow his guide lines it takes you there fast lol

October 12 2013 at 11:18 PM Report abuse +1 rate up rate down Reply
ga7smi

because I don\'t get paid enough

October 12 2013 at 11:17 PM Report abuse +2 rate up rate down Reply
1 reply to ga7smi's comment
Cindy

That is part of the problem when your job won't pay enough to keep up ith inflation.

October 13 2013 at 9:00 AM Report abuse rate up rate down Reply