Soup is NOT a meal. What? What in the world does that have to do with debt? One of my all-time favorite Seinfeld episodes is where comedian Kenny Bania gives Jerry Seinfeld a brand new Armani suit and tells Jerry that they can call it even if Jerry takes Kenny out for a ‘meal’ sometime. Seems like a reasonable deal, right? Jerry gladly accepts the offer and then ends up taking Kenny out to a restaurant and since Kenny was full from a hot dog he recently ate, he decides to just order soup. Kenny and Jerry argue about whether soup is a side dish or a meal which inevitably Jerry loses the argument. Jerry left the dinner with one of the worst three word phrases hovering over his head, YOU OWE ME!
Over the years, my philosophy around financial planning has evolved from when I first started in the business almost 25 years ago. Debts come in many shapes and sizes, but no matter how large or how small the debt they certainly take their emotional toll on us every year. Think about the debt you owe your family for a visit that you just haven’t been able to fulfill. Consider the debt of high priced mortgage that feels like you will never be able to really pay it off. Or how about the crisis of both credit card debt and student debt that is piling up on Americans across the United States? Waking up every morning thinking that you owe someone can be a burdensome load to carry on your back no matter what stage of life or what age you are at this time. Why is the phrase ‘YOU OWE ME’ so emotionally powerful?
I’m a firm believer that our brain doesn’t have the ability to be neutral. We are always thinking positive thoughts or thinking negative thoughts. We tend to dwell on the things we think about all day long. Carrying any type of substantial debt for a long period of time can extract several types of negative emotions.
- Why Me?- I’ve learned firsthand counseling couples financially that money arguments are one of the leading causes of divorce. Resentment is a strong emotion that can come between couples specifically over debt within their financial household. Perhaps it is a student debt that one partner brought into the marriage. Or what if one spouse wants a fancy car that requires a huge loan while the other partner drives the minivan? Debt can cause the ‘why me’ syndrome with the feeling that any other way of life besides the one you have now would be better.
- High Anxiety- Ask most people why they work and they will tell you that they have ‘bills’ to pay. The majority of these bills are the mortgage, the car payment, or the monthly AMEX that seems to creep up higher and higher every month. This anxiety takes a toll on your performance at work and your attitude at home. It can often make you grumpy, irritable, and despondent.
- Complete Denial- For those of you who have consistent credit card debt or are on your third refinance, you may have sent yourself into personal denial that you even have any debt at all. You have just succumbed to the fact that you’ll always owe people and it doesn’t really matter anyway. Owing people through this type of emotion can cause irrational behavior potentially making your situation irreparable.
At this point in life, I’ve learned that being debt free is much more than calculating your net worth or checking something off the to do list. Getting rid of the words YOU OWE ME whether it be financially or personally will allow you to live a much happier and more fulfilling life. You work because you want to work. You make purchases because you want to make purchases. You spend time with friends and family because you want to spend time with friends and family. Make your plan to pay off your debts and it just might be the smartest money move you make in 2015!