Sunday, 15 April 2012

How to be free - ESCAPE DEBT

I’ve mentioned Tom Hodgkinson on here before.  He’s the editor of The Idler, and has written books “How to Be Idle”, “How to be Free” and “The Idle Parent”.  I love the principles expressed in “How to be Free” (though not all the ideas in the book), and while I don’t agree with the term Idle I think The Idle Parent is a must-read and describes well how I was brought up and how I wish to bring up my own children.

I’m writing a series of blog posts exploring these two books, and the ideas contained in them further, in the hope that this will help me to explore further the principles behind my own way of living and parenting. 

Chapter 9 - Escape debt – CUT UP YOUR CREDIT CARD

Banks = bad

A little simplistic, but since their entire business plan is built up on the reliance on your debt, in order to collect interest payments, you can imagine that they are not going out of their way to help you live within your means.

Banks, while making it difficult for poor people, make outrageous profits.  They are highly organised global corporations who do very obscure things like making bets on debt that they borrow from one another.

Clever advertising by the banks tries to lead us to the conclusion that they are there, working selflessly, for us.  When in fact they are working selfishly in order to make more profit.  They love us to be in debt.  More debt means more money for the bank.

Being in debt makes people feel bad, it seems that you are forever bound to pay interest and repayments, so that you are never free to live within your earnings, because you will always be paying for something that you had, used and finished with a long time ago, or a house that will take you all your working life to own yourself.  This is why it seems so crazy that students are expected to go into debt so horrendously at such a tender age – many of them will still be paying off student debts well into their thirties, to say nothing of the debt that is added on by trying to get on the “property ladder” and the expectation of a new car.  Once you’re in debt, you are forever tied to the job, because you can’t get brave enough to go self-employed or leave the rat-race if you owe loads of money.

Tom suggests that the only way to stop the debt, is to stop working, because if you know that you have a regular wage coming in, it makes it easier on your psyche to spend=borrow more  money.  Leaving the system allows you to wiggle and work your way free of it.

He also suggests that if we are in debt we should simply cease to worry about it.  You’re very unlikely to be cast out into the streets – Voluntary Repayment Agreements (I think that’s what they are called) are a situation where you tell your creditors that you can’t afford to pay, but agree to pay what you can.

Cut up your credit card.  Snap your fingers at the banks.

How does this match up to the Ink Spots and Grass Stains life?

It’s true that since I have been a stay-at-home-mum, with no regular earnings, I just don’t get into debt anymore.  Hubby gets into debt on my behalf!  Actually, my first marriage resulted in an enormous heap of debt in my name, which left me financially crippled for several years, and debt now terrifies me.  Hubby says, lets get a loan for a new car, and I think “why don’t we buy a cheaper car and save up so that next time we can just buy one new?”

I hate debt.  I have cut up my credit cards.  I do my best to be thrifty, to spend very little and to save for things.  Yes, I think I pretty much go with the aim of this chapter, and being personally debt free makes it much easier to plan for earning what I can for the life I wish to lead, rather than worrying about debt remaining to be repaid.

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