There was once a retired electrician who didn't have much money. Suddenly one day he found out that he had no money in his account. When he looked closer - he found out that he had been sued by a debt collection company and the money from his bank account had been legally taken by the company after he lost a case he didn't know about. When he tried to sue them back for their unethical behavior- he was unable to do so because of a contract he had signed earlier, stopping him from doing so.
Sounds hard to believe, doesn't it? This is what happened recently in America - New York Times has the full account of what happened in an excellent article by Jessica Silver-Greenberg and Michael Crokery.
This is happening all over the world and it is surprising how many people get trapped with bad debt that ruins their life, their relations, their peace of mind and happiness. I have seen extremely educated people, signing long contracts and taking huge amounts of debt without thinking about the repercussions to buy things they don't need. Companies are encouraged to take more and more debt to fuel growth that is not sustainable. Countries are encouraged to take larger and larger debt for large projects that might not really help anybody. Eventually all this bad debt strikes backs and created problems.
I have seen institutions purposely giving debt to those individuals who are likely to default. In return of course they take a co-lateral worth much more than the debt and once the person defaults they pounce in like vultures and strip the person of all assets.
I have seen companies and individuals being wiped out because of debt and once they have temporary access to funds, they blow it up on things they don't need. With limited resources - these companies would have been more creative and used their mind and resources better.
The thing with debt is, it is always sucking money away from you - even when you are sleeping at night, your interest element is working against you and taking money away from you. Thus eventually you become like a rat running on a wheel, no matter how much you run, you never get off the wheel.
I have seen people encouraged to take more and more debt by everyone around them. So if you work in a company and you get a raise, suddenly everyone - right from your banker to your boss will encourage you to buy a bigger house or a bigger car or something fancy. All in a hope that once you spend more, it will be harder for you to leave the job you might want to or it will be harder for you to start something new of your own.
Someone who used to work in New York at Lehman Brothers, was telling me how he was always being encouraged to spend more and more and buy a bigger house and other things he really didn't need. He luckily, didn't listen and saved up enough in six years to leave his job and pursue his passion of being an actor. Today he is quite happy and pursuing things he loves.
The same way debt spirals and goes out of control - buying small assets helps in the long run. No matter how little money we have today, if we can save it and invest it into assets, we will certainly benefit in the long run. Those assets will work for you, even when you are asleep.
Happiness is not something we derive by having a bigger car or house - it comes from within.
Stay happy and make the most of the Holiday Season. I have been happy writing my book and thank the lovely soul who has been helping me edit it! I have a lovely feeling about this book and all the souls and people who are helping me with it.
Lots of love and smiles to everyone!