If there is one thing you can bank on, it’s that people will spend more than they have. Most people live beyond their means. Maybe they have a savings account, and maybe that savings account is growing… But then a purchase is made: a bigger house, a new car, a renovation, a medical expense, a car repair, a new furnace, a high definition TV, a fabulous new outfit, a vacation… and then the savings account diminishes, and it’s time to go (further) into debt.
I received this add from my bank yesterday:
What’s the message? Today is a great day to meet your shopping goals! Translation: Purchase on borrowed money, and take your time paying it back. Buy, buy, buy, by borrowing, borrowing, borrowing, sending you deeper and deeper into debt. It’s easy, so go ahead and spend money you don’t have.
The thing about this advertisement is that it’s not selling you any one product, it’s selling you a lifestyle where you can live in greater debt. It’s selling you ‘affordable’ interest. It’s selling you a pattern of lifetime debt. Buy now, pay later, and keep paying.
That savings account you once used to build, now grows only immediately after a salary cheque… then each month instalment payments on debt, added to monthly expenditures, eats away any hope of savings. But don’t worry, you’ll find away to almost pay for the next big purchase. Almost. And your bank will lend you just a little more to pay it off. And then you can set your own pace to pay it off. The slower you go, the more you pay, the less you have to accumulate savings… The more you go into debt after that next big purchase.
Welcome to the endless cycle of debt.