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When the first credit card arrived on the scene in the 1950s, no one could have imagined how much that small piece of plastic would change the way we think about money.
By 1970, only 16% of Americans had a credit card issued from a bank, according to the Federal Reserve Bulletin . Paying with cash was just a normal way of life. But something happened in the ’80s. NerdWallet reports that credit card companies figured out how to market debt with interest rates of around 18%, and credit cards took off. That’s when the idea of debt as a way of life began.
Today, nearly 70 years after the first credit card was introduced, debt is everywhere. Only 6% of respondents to a GOBankingRates poll believe paying off their credit card debt is a top priority.
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That means if you’re working the debt snowball and focused on getting rid of credit card debt, then you’re in the overwhelming minority. And that’s exactly where you want to be!
You’ve got too many companies nipping at your heels trying to convince you that debt is okay—that you need more of it! But companies like Chase and Sallie Mae aren’t out to be your hero. They make money off your debt.
We want you to steer clear of debt no matter what our culture tells you. You can live differently, just like Rachel Cruze says in her best-selling book Love Your Life, Not Theirs: 7 Money Habits for Living the Life You Want.
So how do you do it? How do you let go of normal and embrace a new way of managing your money?
Here are three quick ways to steer clear of debt forever:
1. Cut up those credit cards.
Scissors, meet plastic. You spend more when you use a credit card, according to a study published in the Journal of Experimental Psychology: Applied. It’s just natural human behavior. It’s easier to swipe than it is to pull a few dollars out of your wallet or purse. So drop those cards once and for all. And, while you’re at it, call the credit card companies and let them know you’re closing the account. Simply cutting the card up won’t close your account.
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2. Create a budget.
Tell your money where to go at the beginning of each month, instead of wondering where it went. EveryDollar is our amazing online budgeting app that will allow you to do just that. Budgeting is the best way to begin taking control of your money immediately!
3. Stop trying to keep up with the Joneses.
Let’s be honest: The Joneses are broke. They’ve got four student loans, three credit cards, two car payments, and one massive mortgage they can’t afford. Their life might look perfect from the outside, but in reality they’re caught up in our debt-obsessed culture. Instead of following the Joneses, why not set an example and show them how to follow you! Love your life, not theirs!
If you’ve struggled with money for years now, you can make 2017 the year you change things once and for all. Debt is normal. It’s time to be weird.
For more about winning despite the culture’s obsession with debt, check out Rachel Cruze’s best-selling book Love Your Life, Not Theirs. Rachel Cruze is a seasoned communicator and number one best-selling author, helping Americans learn the proper ways to handle money and stay out of debt. You can follow Rachel on Twitter at @RachelCruze, online at rachelcruze.com, or at facebook.com/rachelramseycruze.