Thursday, August 25, 2011

Debt Tolerance

Ha, Obama government did it. They raised national debt ceiling. And I loathe it.They found an easy way out - easy for them....which is heavy on the back of honest, hard-working people and the future generation. Now Mr. Obama will be remembered as "the president who got us into deeper debt".

Obviously, S&P is not as debt-tolerant as Mr. Obama, since they lowered U.S. credit rating right after the debt ceiling was raised.

If I can't afford to buy a new car, I would buy a used car. If I can't afford to buy a used car, I would take a bus until I save enough money to buy a car. All because my debt tolerance is very, extremely low. I might have allergy to debt.

Both in America and here in Korea, I see many young people taking out loans with no second thoughts, just to get a new car or to live in a bigger house. By the way, here in Korea, right now the interest rate for a loan is around 7-8%.

I have a friend who once had $30,000 debt in college. It was not a school loan. It was a credit card debt. She loved shopping, eating out, traveling - all done with a few credit cards in hands. When she accepted Jesus into her life, one of the first things she wanted was to become financially clean and responsible.

After talking to our pastor, she moved out of her apartment and moved in with an old lady, who hired my friend as her caregiver. Salary and free housing - she was already able to cut huge part of her monthly expenses. Then she stopped eating out. Between classes and her new job as a caregiver, she didn't have time to go out any longer.

She paid off the $30,000 debt in two years.

What is your debt tolerance? Does the word 'debt' make you cringe? Would you take out a loan or would you downgrade your life style?

Any government, like any family, can for a year spend a little more than it earns. But you and I know that a continuance of that habit means the poorhouse. Franklin D. Roosevelt, 1932