Someone in Knowledge Planet asked me a question about what to do in a situation where they are not young, lacking in ability, have a Family, and have a large amount of debt for various reasons.
There should not be a few people with similar dilemmas.
In today’s society, there are probably people around each reader who have a large amount of debt and are temporarily unable to repay it, and maybe even relatives or friends of theirs. People who can’t pay their debts are a very large group of people.
The borrower and the lender are actually making a deal. If you have seen the famous animation “How the Economic Machine Works” by Rae Dalio, you can understand this: borrowing because the borrower is going to buy something that he cannot currently afford. The lender must not only recover the principal, but also receive interest.
When it comes to debt, many people say they have debt from buying a house, in fact, you borrow from the bank to buy a house like this, are not a matter. Because this is also a little risky, but overall is excellent debt. The house is real estate, but also the probability of appreciation, there is no need to worry about it. For example, if you are a new programmer and you borrow money from the bank to buy an Apple laptop, there is no problem at all because the computer can be used to improve your production and thus you can earn more money. A similar situation is when you pay for school, buy books, pay for knowledge courses, I don’t hear of anyone who can go bankrupt for this.
The problem with people who are constantly involved in debt is that they borrow the money, take it, don’t make any more money at all, and, obviously, keep losing money. The easier it is to borrow money, the more debt they owe. This means that when it comes Time to pay back the money, the lender (debtor) can’t collect the principal, not to mention the interest.
Then the borrower can’t pay back the money, they go to a second lender, then a third, until they can’t borrow money from all the debtors. At this point, they start to harm their families, relatives and friends, making them unsettled and becoming scum in the eyes of their friends and relatives. Borrowers sometimes confuse the act of borrowing money from close social relations with borrowing money from society as two different things. After all, if you borrow money from your relatives and friends, they can’t help you if you don’t pay them back, but if you borrow money from the bank and don’t pay it back, you’ll be in big trouble.
Bankruptcy is actually divided into two kinds, one conceptually speaking is the financial bankruptcy, because you can not repay the debt, there are constant debt default. There is another kind of social credit bankruptcy, cheating people you know one at a time. In the end, the social relations think that the person is hopeless, including Parents and siblings think so.
Why do people who fall into this kind of debt always lose money? That’s because, most of the time, they take the money to do zero-sum games. For example, gambling. Gambling, in this society, comes in many forms. Buying lottery tickets is gambling, adding leverage to invest is also gambling. At the beginning, it may be confusing to do so, but the later, the more obvious the gambler’s mentality. Or, simply become a gambler.
If you’ve read my previous article on how ordinary people can make a comeback, mention some of the behaviors that “can ensure that you enter the abyss”, you need to be vigilant.
Why do these people always resist the urge to do zero-sum games? There may be many answers, but reading their narratives, they do not know how much they have, always think they are smart enough, or play smart. Always thinking about turning over money, always thinking about making a quick buck, always thinking about doing a big job. Such thinking is actually very dangerous.
Lack of patience for delayed gratification may have been written in the genes of some people. If you want to deliberately develop your own sense of delayed gratification, then the more noteworthy things may include: do not become indebted.
To the point of social relationship collapse, if you still want to save yourself, the most important point is to recognize your own ability, do not feel that you are a wistful person, do not always feel that you did not succeed is not to meet the opportunity.
Can’t get down to business, can’t solve their own debt.
The prerequisite for solving financial debts is to first build up your social relationship credit. You have to establish credit from your relatives and friends first and not let them down again. Is this easy to do? For a person in debt bankruptcy, this is one of the easiest things to do well, you just don’t have to lie to them and they will think you are still saved. If this doesn’t feel doable, then everything else is harder, and, everything else has to be on top of this step.
The social relationship credit thing is actually very important and should not be taken lightly. People with whom you have a social relationship, you only have one chance in front of them. One breach of trust, such as borrowing money and not paying it back, and people won’t trust you again in the future. Unless it is your family will tolerate you again and again out of tune. Friends are very difficult to do this.
How much debt, different people face different numbers, but the pressure on them may all be the same. A person earning tens of thousands of dollars a year who owes hundreds of thousands will feel desperate that they can’t pay it back in their lifetime. Another person earning several hundred thousand a year and owing tens of millions may be equally desperate.
Of course, you can choose to break the pot, now individuals can also choose to “bankruptcy”. If you’re fed up and don’t want to take on any more responsibility, then you do have a choice. I’m not talking about people who are in business, who have fallen into debt because of poor business practices, or who have fallen into debt because of changes in the social structure, in a sense, they are also victims.
But what if an ordinary person, who is in debt, has a family, children, parents ……?
As an adult, it is still necessary to find a solution. Otherwise, you can’t be a decent human being.
The premise is not to let the debt continue to expand. You can’t borrow to pay off your debts, because the debts you owe before are basically coming from this. Tear down the east wall to make up for the west wall will only carry more debt. Borrowing money always has a cost, and if the cost gets higher and higher, then it is impossible to pay it off.
Many people don’t realize that some debts can be negotiated with the debtor by sitting down and working out a new repayment plan. Because your financial situation is finished and you won’t be able to pay back a single penny if you continue like this. For the debtor, he is to let you on the list of restrictions on high spending is useless, you simply can not repay the debtor will still have to bear some losses. Then you can discuss whether you can repay the principal or charge less interest.
Don’t feel that you can’t pay off your debts for Life, in fact, there are methods and strategies, and in the end it’s just a matter of math. This is actually a matter of personal debt restructuring.
For example, some young people who have just started working have a lot of credit card debt and can’t afford to pay it back. What to do? Call the bank and explain the situation. Agree on a new repayment plan with a little less interest charged. Then you work hard and pay it off in a few years.
It’s important in this process that you don’t take on new debt and don’t let it continue to grow.
Then, very importantly, you have to work.
In this society, as long as you are able-bodied, nothing serious, and not paralyzed in bed, to find a stable income is not so difficult, and how high the Education level is not very relevant. I always say, delivery delivery courier can have a good income, you lie in bed all day and do not move what is going on? Money can fall from the sky to your bedside?
As long as you can do a job, there is a stable income, then everything there is hope. Although the job may not be high income for the time being, but at least you can make ends meet and keep paying off your debts. With a job, you have the opportunity to build personal credit and social relationships, and you have the opportunity to increase your income and earn more money.
You should also give up some bad habits, such as smoking and drinking. Smoking not only costs money, but is also bad for your health. Drinking is also bad for the body, and can be a mistake. Don’t say anything about the excuse of drinking away your sorrows, do you have that qualification?
Of course, in this process, do not think about turning over the capital, do not think about getting lucky, once you think so, you are still a gambler. The previous have said, into this kind of debt people, it is obvious not to be able to earn fast money this material.
Indeed, most of these people do not remember, and, a certain percentage of them will repeat the same mistakes. I have to say, this is indeed sad.
It can be difficult to recognize your own words. These people do not know their own inferiority, because of inferiority and sensitive, have made this virtue, still can not hear a criticism, think others hurt their self-esteem. This virtue does not care about self-esteem. You are nothing, that little self-esteem who will take it seriously?
The debt is not completely insurmountable. Although the process is difficult, but only then there is a chance to return to normal life.