09 Oct Cutting up your credit cards isn’t the way to do it…
Unlike other wealth coaches, I am not going to ask you to deprive yourself of all fun activities that cost money. I am not a fan of cutting up credit cards, and drastically reducing the quality of your life.
If you like buying a Starbucks coffee each day and it makes you feel good, I say do it. If you like cable TV, I say keep your subscription. If you like eating out, continue doing so. I don’t believe in you reducing your quality of life substantially over the long term. Life is just no fun without having at least some nice amenities—like a dinner out, cable TV (if that is important to you), and, yes, the occasional Starbucks coffee.
Yes, cutting your everyday expenses could advance you faster by freeing up more money to invest, but cutting out every single thing that makes you enjoy life will sap the life and motivation out of most people. But taking a pair of scissors to your credit cards and living like a pauper is like putting a Band-Aid on an injury that needs surgery. Not creating more bad debts is one small part of the larger battle – you also need to make more money and to invest that money into cash-producing assets.
So that’s why you won’t hear me talk too much about the “evils of big banks” and “predatory lending”. My goal is to help you treat the sickness, and not just the symptoms. Start by looking closely at your expenses and decide which ones serve a purpose and which ones don’t serve a purpose. Then stop throwing money away on things that don’t bring you forward at all.
If you can classify your regular purchases like this, you will be light years ahead of those who simply cut up their credit cards.