March 25, 2008

Why do we get into debt?

If there has been a lesson recently about the dangers of being in debt it has to be the problems that came about due the US sub prime mortgage situation. This has had a knock on effect around the world and in particular here in the UK, with Northern Rock being the most significant casualty.

So this begs the question as to why people get into so much debt that they have little or no room to move in should there be a crisis. The answer is fairly straight forward and to most people this will relate directly to them.

The reason why so many people get deep into debt is the simple fact that they desire to have the best of everything, they need the all of the latest gadgets, a new car maybe even two, and holidays that would make anyone jealous and that is the key. It about being jealous and making everyone else jealous. This vicious circle just grows and grows, it takes a very brave person to step off and sit back.

Source [Washington Post]