Have you ever been in handcuffs?
Fear not - if your answer needs to be a positive one, feel free to keep mum at this point.
If you haven't ... I haven't, either - and hope not to ever be so, either.
It really restricts one's freedom of movement ... and one can't get anything useful done (if the arms are behind one's back).
However ... many people are in financial handcuffs.
And in most cases, they choose to do it to themselves.
How is that?
They live paycheque to paycheque.
Most financial advisors recommend that everyone should have three - six months' worth of income available, in case of need.
In today's uncertain economic climate, who knows who may be laid off next?
And be unable to find employment with anything like comparable compensation level ... or with far fewer additional benefits, e.g. retirement plan, etc.
If the motor of your car has a major trouble, and needs large repair, e.g. $1,000 - 2,000. how would you handle that?
Or how about if your furnace quits and you need a new one?
It sure is handy to be able to take care of such things easily with available funds, without sweating ... and especially without sweating blood, so to speak.
I call that financial freedom. And I like it.
Some will answer that they'd put the expense on the credit card.
I agree, that in many cases, that may not be a bad idea ... and I do that, myself, on occasion.
But - to be used on one condition: that you pay off that credit card debt in full, just after your next billing date.
Don't carry credit card debt over a number of months.
Do you have any idea what interest rates they charge?
With regular "credit" (really "debt") cards, it's usually about 15 - 18% annual rate - and compounded monthly.
And don't miss, or even be late with a payment! A big extra fee if you take that route!.
And cards issued by most stores ... charge about 28% annual rate, or some even higher.
I don't like paying such high rates of interest!
And ... since most of the stuff that most of us buy using our card is non-deductible stuff, we must pay off those bills with after-tax money!
It seems to me that the work that I do to earn the money to pay that interest is more or less working for nothing.
Good wishes for arranging your affairs in such a way as to avoid carrying consumer debt.