Wednesday, September 23, 2020

My New Social Project - Living On Cash

Owning the money is a modern slavery. If you have taken out credit on something; for a car, mortgage, student loan, vacation, etc., you are actually borrowing money which you don't have. That is okay because you will return the money, with the interests, of course. The problem comes when you're borrowing more money than you can afford and in most cases you're probably buying the stuff that you don't actually need.

Reality behind credit card debt is harsh. In our world, it is accepted that people have large amount of debt on their credit cards, actually it is quite normal thing. They are holding us by the minimum payments. The credit card rate is, on average, 19%! As an obligation you have to pay only monthly interest. And that can prolong high credit card balance for years to come...

So knowing all this, I'm aware and conscious of credit cards trap. I've decided, against all the present financial trends, not to use credit cards at all. Tomorrow, it is my payday and I am starting new project - living on cash. I have calculated that I need $30 per day for my expenses and I will take $420 for the next 14 days and I will live my life with that money.

In 2017, I developed an android application to keep track of the cash expenses and I am going to use it. I will record every single transaction I made. I will only keep using the credit cards for payment of the regular bills such as telephone, internet and long distance calling while my mortgage, car and condo insurance, condo maintenance and property tax will be taken from my checking account.

I owe a lot on my line of credit (with relatively low interest rate of 3.45%) but I would like to get rid of that debt. My plan is to pay off my mortgage as soon as I can. I have calculated I need at least 10 more years to pay it off. A long time... but if I am careful with my spending I can accomplish this couple years earlier.

All this is possible because I am living alone. If have the family, living with kids and wife, the saving goal is very difficult almost impossible to accomplish. 

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