And no, I’m not talking about houses here.
I’m talking about your money.
I’m talking about my money.
Do you own your money? Or do you rent your money?
For the past 19 years, I’ve been renting my money.
For the past 19 years, I’ve been in debt in one way or another. Car loans, students loans, credit cards, mortgages, equity lines, business loans, and personal loans.
For the past 19 years, I’ve been paying other people for the privilege (seriously makes me want to gag) to rent their money.
Chase United Mileage Plus card offered me a deal to rent their money. And as a bonus for renting, I got a few miles and ended up taking a few trips that required me to rent even more money.
Fannie Mae made me a deal to rent their money. I rented their money and lived in a house. I used to call that owning a house but the truth is: I never owned it. I rented the money so that I could live there. Fannie Mae owned the house and they owned the money that I used to stay there.
So here’s what is interesting about renting money…
Until I am debt free – I’m still renting.
Even though I’m no longer using credit cards.
Even though I’m paying off my debt.
Even though I’m kinda militant about the evils of finance charges. And tell every check stand clerk that offers me 15%-off-if-I-open-a-card-today my opinion of what they are doing.
I’m still using.
Just like a junkie in tenement housing.
I’m still using someone else’s money. Paying to rent.
The dollars in my bank account are owed to someone else. They are not mine. I do not own them.
This gives me a very honest perspective on whether or not I should pay money for something or not.
I don’t want to rent money anymore.
I want the dollars that I earn to be mine.
I want to own them.
I want to be able to determine what I do with them.
I don’t want Bank of America or Chase or anyone else in the private life of my money. These institutions are the financial equivalent to a slumlord.
Slumlords get their name by offering a crappy place to live and making money off of other people’s misfortune. (No different than credit card companies.) Slumlords offer initial low rent to lure tenants who will not or cannot pay high rents due to lack of funds or faulty background checks. Slumlords then profit off the dependency of the tenant while continuing to raise the rent. They prey on tenants who believe they cannot live elsewhere.
Credit card companies prey off of our weakness when it comes to instant gratification. They offer us nothing except an offer to pay for renting. They profit enormously from the dependency that they create.
I’m done with this.
If I want to buy something right now – all I have to do is remind myself that the slumlord is paying for it. And that immediately sets me straight.
I don’t want the slumlord to pay for my stuff anymore.
I don’t want the slumlord to be in my life at all.
I’m paying the slumlord off. And I’m moving out.
To a place where I own my own money.
Talk about emancipation, baby.
Freedom.
There’s nothing better.
This post was originally published on MeadowDeVor.com.
You don’t mention that there are positives to renting money if done properly. Sure, many financial institutions are poor “landlords” and really get many folks into trouble – buyer beware rather than buyer don’t buy. There are many sound investment strategies out there that mean debt, but healthy debt and allow you to put your money to work. Just seems a bit hardline, although if you can hack it, I’m sure very liberating.
Andy, the name of this site is ENEMY OF DEBT which isn’t just a catch phrase it’s what I believe. Don’t expect to find any “good debt” tips here. 😀
The bottom line for me is that acquiring debt for financial gain is risky for the simple fact that you cannot predict the future. You could get a mortgage, start a business, or even get an education using debt but in my opinion that is putting those who do it at an extreme disadvantage, not to mention a higher cost over the long run.
Just ask the people going through foreclosure, shutting down their business, or that are struggling to pay their student loans.
Oh and yes, it is very liberating indeed, and not all that hard to do as long as you don’t buy into the whole “needing” debt thing. 🙂
Thanks for sharing your thoughts. Your opinion is definitely accepted by most people though I’m striving to change that with this site.
Hey Andy –
You’re right – I do take a strong stance against debt. I see it as an unnecessary expense – and as the creator of so much anxiety, worry and shame in our society (and in my own life). When I invest, I choose to use cash. I choose to use money I own to make more money rather than paying rent on the money that I’m hoping will make me a profit.
Great post. I’ve honestly never thought of it as renting money, and I thought I had read and written about debt in every way possible. 🙂 Awesome.
Thanks Ashley. I think it’s a really cool concept. I love using this reframe with my clients. It just helps put things in perspective for them.
I agree with Ashley! This is definitely an interesting take on what it means to borrow money. I LOVE THIS POST!
Funny thing was I just got back from walking a huge corn maze with my family and the farmer/owner started talking about my wife’s license plate which says H8 DEBT2. It led to me mentioning that I own a site called Enemy of Debt and he had this puzzled look on his face as if to say “why would you hate debt?”
He went on about why credit was necessary and that good debt helps build credit. Of course he added the default response most people have to me saying credit nor debt was necessary by talking about car and apartment rentals. I told him I’ve rented a car with my debit card and when renting a house or an apartment an emergency fund statement works just as good to prove financial responsibility.
When I told him I’ve not had a credit card or borrowed money since the end of 2007 and have been debt free since 2009 he didn’t know what to say. What could he say? I busted his bubble and it was hard for him to argue his point any further.
BTW, I absolutely loved your response to Andy! Well stated! ::D Welcome to the team!
I’m right there with you Brad. I’m loving this post too! It’s to the point, and free of “good debt” pros and cons. Having debt and renting money will never lead towards a path of financial freedom, and that is the truth. Being the owner of your money is liberating and it makes you so thankful for what you have. That is priceless!
I hope Meadow offers other posts in the future, I’d love to read more.
Absolutely Carrie! Oh and just so you know, Meadow is now a contributor here on Team EOD so stay tuned for more down the road. 😀
Thanks Carrie – I don’t talk about “good debt” because debt free is the only things that makes sense to me. Debt is debt. Some debt just costs less than others.