Are We Financial Slaves?

The concept of financial slavery is psychological, but no one is forcing you to be a slave. Many people feel this way because of giving into materialism. We work long days, pay bills to survive, and use credit cards to buy items we can’t afford. The problem begins when we rack up so much debt that the money we make seems to be insufficient to satisfy our needs.

According to the Federal Reserve, the total consumer debt was $2.5 trillion, in December 2011. Eighty-four percent of African-Americans and 54 percent of Caucasians carried credit card debt in 2004, according to Financial experts believe that these figures have increased dramatically as a result of the economic downturn.

As we carry more debt each year, our finances are harder to manage and our lives start to revolve around money. We work to survive and pay off debt, when instead we should be enjoying money and saving for the future. The good news is that we can identify and avoid becoming financial slaves. The experts at have a list of danger signals you should look for:

Do you spend more than you earn? If your gross income is $2,000 a month, you shouldn’t spend $2,100 a month and charge the difference on your credit card. Credit cards may make you feel better about your income, but spending more than what you earn will get you into trouble.

Do you spend more than 15% of your take-home income on credit card debt? On average, you should only spend about 10-15% of your monthly income on credit card bills. If you spend more than the 15%, you may need debt help to get your finances back on track.

Do you make only the minimum monthly payments? Making the minimum payment may be keeping you afloat for now, but it’s not helping to pay down your debt. When you pay only the minimum amount due, most of the money go towards paying the interest and not the actual debt itself. Paying off your entire bill each month, paying double the minimum due, or paying the amount of interest charged plus the minimum amount due will start to reduce your debt. If these options seem to difficult of out of reach then it would be wise to seek out a credit counseling agency for advice.

Your credit cards are maxed out. If you’ve maxed out your lines of credit on all of your credit cards, you don’t need another credit card—you need debt help! Maxed credit cards are a sure sign of credit card debt problems.

If you answer yes to any of these questions, pay attention because you may be entering the cycle of debt. Don’t wait for your situation to improve, seek debt help at