The Reasons Why We Are Always in Debt
July 1, 2018
We may earn money from the companies mentioned in this post.
Why are we always in debt? What’s more troublesome than being in debt is not knowing why we are in debt. I compiled some of my top reasons of what is keeping us in debt.
Reasons include paying full price, shopping out of boredom, we buy things we don’t need or things that do not last, we buy coffee out over brewing it, we waste things, we don’t walk away, and we pay fees and high interest.
We Pay Full Price
There are few instances now for which I will pay full price. I always think about the markup on a product when I go to buy it and ask myself is that blouse really worth $40? Is $80 for this pair of shoes reasonable?
When purchasing clothing, I question how much will I be able to use a particular item. If it is a staple item like a pair of yoga pants or tennis shoes, then the value of the item goes up for me because I know I will use it over and over again.
I live in the Midwest so we experience all four seasons. The item gets bonus points if I can wear it four out of four seasons to really get my moneys worth. We may want to ask ourselves before buying, “Is this a seasonal item?” or “How much use can I get out of this if I buy it today?”
How much did it cost to make this item? What brings the cost up? A certain designer or brand name? A costly material?
I have a set amount I typically like to spend for clothing pieces and will rarely go above that.
If you have trouble finding good items on the clearance rack, you’re not alone. For clothing, I like to wait for those deep discount sales like “40% Off The Entire Store”.
I typically stay away from sales that state “Up To…” in the advertisements. “Up To 50% Off Select Items” or “Up to 70% Off Shoes”. All too often the 50% and 70% have you hooked, but you end up seeing most items are well under 30% off and it’s easy to leave disappointed.
We Shop Out of Boredom
The mall is a place you go to meet up with friends, grab some lunch, and buy things you may not even need. It’s a place we go to spend time and we’re bound to buy something.
When you’re not at the mall, our tech savvy lifestyle with smartphones has made it ever so accessible to hop on shopping apps after you’ve already browsed through all of your Social Media feeds and cleared out your emails.
Before you pull up the shopping apps, ask yourself if you are shopping for a need or if you are shopping because you’re bored.
We Buy Things We Don’t Need or That Do Not Last
How often do you buy things you don’t need? If you like a great bargain like myself, maybe you’re guilty of feeling a need to use every good coupon you get in the mail.
I remember when registering for gifts for my wedding, my husband scanned a hot dog contraption to warm hot dog buns and heat the hot dog itself.
Now, that may be a great gift if you eat a lot of hot dogs. However, that wasn’t us. In the grand scheme of things, it wasn’t something we needed for just starting out.
Think of something you bought that hasn’t lasted, but you got a good deal on it. I don’t like to spend a lot of money on any one item, but I want to make sure I’m buying a quality item that’s going to last.
If I’m buying online, I always look any any reviews listed ahead of time and look at the material used to make the product to get a better sense of the quality.
We Buy Coffee Out Instead of Brewing At Home
Buying coffee when you can brew it at home is just one example of how easy it is to overspend on an everyday item. Purchasing a car wash when you can use a hose and a bucket of soap and water. Paying for a gym membership when you can do a lot of workouts out of your home.
Eating out is huge and probably one of the most costly things we can do. Let’s face it, food is expensive. Not looking for savings on everyday items we are already purchasing can keep us in debt.
We Waste Things
We didn’t finish that can of soda, we threw out a lot of leftovers this last week, or we went out and bought something we forgot we already had. It happens more than you may think and being aware of it is the first step to stop the waste.
You better believe I am squeezing that last bit of toothpaste out of the tube, or turning my foundation bottle upside down to use what’s left, or taking the top off the lotion dispenser to wiggle it around and get every last pump.
One thing my family has been more conscious about is putting unused meat and vegetables in the freezer if we haven’t used them by mid week. That’s with doing grocery shopping on the weekend.
We Don’t Walk Away
This could be a matter of convenience or timing. I remember needing a dress for a wedding a few years back. The wedding was in days and I hate trying on clothes in the store. I just don’t like it, but not everyone is like me.
I pretty much bought the first dress I tried on and went only to one store to look. It was an expensive dress in my opinion and I bought shoes that went with it. I did like the look of it and it was a good staple dress I could wear again and again.
But I know I picked that dress because I didn’t want to think about going from store to store, and trying multiple dresses on. So I picked the first one I tried on and probably could have saved more if I shopped around.
We Pay Fees or High Interest
I have known quite a few people in my lifetime that will pay NSF fees, overdraft fees, a monthly checking fee to use their own money, or a late payment fee! These add up and keep us in debt. If you feel stuck paying fees every month, get into a habit of paying one less fee every month to get out of that cycle.
With rates as low as they have been, anything over 6% would seem high to me and could maybe even be refinanced. Shopping around for interest rates is a must. Head over to my post about interest to learn how you can keep interest payments low and get rid of them faster. You can always save it for later here.
Whether it is one of these things that keeps us in debt or something else, I’d like to know what you think. Feel free to leave me a comment.