303 DartmouthThis will not be a pleasant topic.

Do you have personal debt?  The variety of debt is almost endless: mortgage, utility, credit card, student, home owner lines of credit, medical, life/car/health/home/umbrella insurance, federal/state/city/county/excise/property taxes, and money lent by family or friends.  Even money designated to be set aside as savings and retirement is a debt we owe to ourselves.  Debt is not a pleasant topic but it can dominate our lives if it gets out of hand.

Some debt is the result of simply living.  We can’t avoid it.  With today’s low interest rate environment it makes sense to refinance homes in order to take advantage of historically low mortgage rates.  Eventually with inflation, these rates, if locked, will almost be like free money.

Some debt is can be eliminated by bankruptcy, but certain kinds of student loans, for example, follow us to the grave.  Credit card debt is perhaps the most egregious because of the generally ridiculous interest rates.  Money we owe to elderly parents is the most morally charged.  They need it back for their retirement and old age.

Partners and spouses who both work easily get used to the combined incomes they draw.  I know a lot of people who invested in second homes, third cars, lots of “toys,” and took expensive yearly vacations only to discover that the partnership did not last or that one of the pair lost their job.  Reality check!

Since the Great Recession a lot of people have been paying down their debts.  They are getting used to living within and below their means and hopefully will not go back to spendthrift habits of the past.  It feels good to save money for the future and for things we really will need.

What is your concrete plan for paying off your debts?  How would you describe your use of (and maybe abuse of) credit?   What have you spent money on this month for things you don’t really need?  Can you see yourself consumer debt-free in three years?  If not, what will it take to learn to live below your means in order to pay off your biggest debt: peace of mind?

Contact the Man’s Coach at michael@parisecoaching.com .