Bills…More Bills

Benjamin Franklin once said, “In this world, nothing can be certain except Death and Taxes.” He was almost right, but wise old Ben left out one more item—Bills. Unless I am speaking with a primary school kid, every conversation I’ve either had or listened to eventually comes around to bills. Groceries, gas, rent or mortgage, utilities, and, for those of us living in the United States, doctor bills.

We all complain about them, but how many people actively try to cut bills out of their lives? When was the last time you went to a store of any kind and bought something with cash? I can’t remember the last time I did. Buying gas, paying for a movie, even getting something out of a vending machine, it all goes on the card. It’s much more convenient to use plastic as opposed to walking around with a pocket full of coins on one leg and the other pocket stuffed with a wad of paper money. It’s quicker too. How many of you get frustrated with the person at the head of the line as he slowly counts out paper money and a fistful of change? Annoying, yes, but he or she isn’t adding to their collection of debt.

Most of us value convenience over all else until the end of the month arrives and the bills come home to roost. How many times have you slit open an envelope from your favorite credit card company to stare in shock, asking yourself, “I owe how much? That can’t be possible.” So, after looking at your deflated bank account, then back at the credit card statement, you find an escape hatch. It’s also known as a minimum payment. Unfortunately, too many people dive through the hatch, which is exactly what the bank wants them to do.

By taking this route, you have willingly increased your remaining balance by an additional 29%, and the banks don’t even say thank you. Just to add insult to injury, your credit score drops. Your debt continues to grow until you receive an offer in the mail for a debt consolidation loan. With this escape hatch, you can bundle all your debt into one big bill that will take you years to pay off. Now you’re feeling better about your financial situation, so it’s time to start using your cards again. And the dance continues.

There is an alternative path you can choose to take. Beat the banks at their own game. I’m no different than anybody else. I like the convenience of credit cards, and prefer using their money instead of my own, but I hate paying the banks interest. Living on Social Security is no picnic. I get a set amount every month, and that’s all I get unless I can find a part-time job or sell a few books. When I started working, 401(K)s didn’t exist, and only the big corporations offered retirement funds. The average person was and still is on their own. The big question is, how do you beat the system?

My escape hatch takes some discipline and restraint, but it works. Every morning, I go on each of my credit card websites. As soon as a purchase shows up, I ignore the phrase, “You have nothing to pay right now,” and pay it. By paying my bills this way, I’m shelling out smaller amounts at a time, so at the end of the month I’m not overwhelmed. The second part of my plan is forcing myself to say no. There are a lot of things out there I want, but unless I hit the lottery, which will never happen because I refuse to waste the money on tickets, I’ll never get them.

So that’s my escape plan. I hope it helps you.