Debt-Proof
Living, The Complete Guide to Living Financially Free
by
Broadman and Holman Publishers,
ISBN 0-8054-2078-9 USD $14.99
In
chapter one, Mary explains that what many consider the finish line is really
the starting line. For those that see
"getting out of debt" as the finish line instead of the starting
point of moving towards financial independence, there is often a new cycle of
debt in the future.
"Bonnie's letter brought to mind my own situation and how I
repaid a boatload of debt; how the temptation to fall back into the old ways of
incurring debt becomes less intense and certainly manageable, but never goes
away. What keeps me from going
back? How can I encourage people to not
stop but to move on to the next level and beyond? Is it possible to win over debt for a
lifetime?" (Mary is certainly
different than I am! The temptation for
debting is still just as intense and completely unmanageable by will
power. I will echo that the temptation
never goes away.)
Principles
for Debt-Proof Living:
*You
must never keep it all. (Tithing, charities etc.)
*You
must never spend it all. Always pay
yourself before anyone else. Always.
*There
are only five things you can do with your money. Give it, save it, invest it, lend it and
spend it. Spending comes last. By
spending it first, we create fiscal disorder and then financial chaos.
*God
is the Source. Your responsibility is to
be a good steward of all that you receive. (Give us this day our daily bread.)
*What
you receive is what you deserve. God promises to supply all your needs. All he asks is that you obey his laws and
trust His word. (Easy
to say, because I believe it. But still very difficult to do.)
*Pay
Cash. (I diverge here, because using a debit card or check makes it easier for
me to keep track. I guess laziness is
the only thing keeping me from being the same with cash. If you can't stop at
zero, by all means, use cash only.)
*No
debt no matter what. Never believe that a little debt is manageable. (Mary
likens it to cancer.)
*Develop
a strategy. A written plan stands firm
whether you're on an emotional roller coaster or on and even keel.
*More
money is not the answer. Using your
current income to "qualify" for more revolving consumer debt puts you
in a vicious cycle that requires more money.
*It
is not how much money you make but what you do with it that matters. The Smiths spend first and *pay* interest
later. The Joneses save first and *earn*
interest later.
*Pay
in full now or pay twice later.
*Living
without debt is tantamount to a taxfree increase.
Reasons
to Debt-Proof Your Life
*To
protect your marriage. 80% of all
divorces are the direct result of financial trouble. (Statistics never
lie. But I think a marriage headed for
divorce sets up a lot of debting.
Co-dependency issues continue into power plays that set up financial
disaster. The divorce happened before we
could be "business like.")
*To
survive lean times.
*To
reduce your stress.
*To
protect your future.
*To
teach your children.
*To
experience fully God's care and provision.
Three personal money management styles.
Debt
Ridden Dexter walking up the down escalator.
Paycheck
to Paycheck Penelope is walking on a treadmill.
She isn't going uphill, but she still never gets anywhere.
Debt-Proof
Peter is walking at a brisk pace and then steps on to a moving sidewalk --one
of those people-sized conveyor belts.
Chapter
2: Intelligent Borrowing or Stupid Debt,
All Debts Are Not Created Equal.
The
only thing worse than investing in things that depreciate is paying interest on
money invested in things that depreciate.
quoted from Baine
Harris
A
home equity loan is curiously known in the industry as HEL. (Actually, Mary, we in the industry call it
HECL {home equity credit line} so people won't know the hell we are getting
them into. They can be a useful tool in
planning a financial future if used with an investment plan and no new consumer
debt.)
New
car loans are designed to sell cars to people who drive them "upside
down" because they really could not afford them.
Mary
boils a frog on page 36. (But please, no
dogs down a dry well.)
Chapter
3: A Plan to Debt-Proof Your Life,
Without a Plan, You're Dreaming
We
make our plans, and then our plans turn around and make us. quote
from F W Boreham
Mary's
Chapter
4: Money Is Not for Spending, It is for
Managing First and Then for Spending
You
are worth what you saved, not the millions you made. quote from John
Boyle O'Reilly
The
rest of the book:
The
rest of the book outlines ways to manage your money so that you will be able to
use that 80 percent to do what 110% can't do now.
*A
couple of areas of interest*
Credit
Reports: Mary says on page 185, "As
bad as that negative entry may be, you cannot erase, repair, correct, amend or
fix it if the information is correct."
(I disagree. I have gotten rid of
some very damaging stuff that was accurate and true. Some of the totally bogus stuff like
incorrect addresses or accounts belonging to other family members seems almost
impossible to correct.)
Student
Loans: Secured or Unsecured Debt? Mary's
take on this is from page 298 to page 313.
(This is a topic which comes up on the list from time to time,)
I
wish that I could have purchased this book.
Perhaps in the future I will do that, because I do find it full of good
resources. But I checked it out of the
library. You should too!
Richard