CRITICAL MISTAKE # 5: DEBT & CLUTTER (excerpt from my new e-book)

Our spending habits are immensely powerful in influencing our quality of life. Two people can have exactly the same level of income, education and abilities yet have very different levels of financial security and contentment. This is possible because of dissimilar spending and saving behaviour, ceteris paribus. Marketing men understand this intimately and craft their campaigns to extract as much of our disposable income and future income as possible.

The smartest men and women around know that this is happening but the skill of the marketer, our curiosity and ego combine irresistibly to suck us into impulsive spending, and debt accumulation.

The internet has allowed unprecedented power and sophistication to marketers.  Every online search is monitored intensively by computer programs designed to gather data to the last detail. The largest search engine and internet database Google, in the year 2010 alone was estimated to log more than 33 trillion database entries of its users’ searches. At any one time your computer may have something like 27 (or even more) different tracking programs working behind the browser screen compiling specific metrics on your online behaviour and preferences.

Search engines are presently experiencing record expansion rates by integrating into various territories of the internet including digital media, advertising, email, and Artificial Intelligence (such as DeepMind Technologies). Basically, the more they expand, the more information will be funnelled to their databases.

Naturally all this has provoked enormous concern about data mining and invasion of privacy of individual users. Considering the amount of money involved and sophistication of monitoring, this is a genuine concern.

As if this weren’t enough, social media sharing of conspicuous spending drives people into a frenzy, to purchase and display their baubles. It pressures us to keep up with the Joneses. Our spending and emotions are closely linked.

Our relationship with money and the degree to which our emotions rise and fall with it is something we need to manage. In order to control our impulsive spending, and even servicing the debt we may already have, to completion. There are some estimates that we are exposed to advertising/marketing which number in their thousands per day and depending on where you live in the world this may number in the tens of thousands.

The accumulation of unproductive debt and the vicious cycle of lavish spending literally enslaves us. And if we pass away before our debts are cleared then the results can be catastrophic for our families, both in the short and long-term.

Create budgets to identify essential recurring expenses – rent, food, utilities, school fees/children’s expenses, car payments, yard maintenance, and also contingencies. This is fairly obvious but something seldom practised. You’ll probably be surprised when you go through your monthly invoices and receipts to note down your entire itemised list of expenses.

Target saving at least 10% of your income, for investment purposes.

If you are not vigilant, the marketing men with million dollar budgets will easily prey on your unguarded wealth and future income. Think of the myriad ads tugging at your attention. Just when you need a respite, to set aside some savings, even make some investment, the trap is set and the debt cycle revolves again.

 “It is in times of security that the spirit should be preparing itself for

difficult times; while fortune is bestowing favors on it is then is the

time for it to be strengthened against her rebuffs.”

– Seneca

 Stress from never-ending debt repayments and fear of property seizure and embarrassment can drive us to the edge. This invasive fear literally takes over our lives and can poison our relationships. It can cause us humiliation.

It corners us, changes how we eat, sleep and thus disrupts our ability to function normally. It also causes deep anger. With ourselves for entering into debt. With our employer for seemingly paying us insufficiently. At our loved ones who may have influenced us to purchase beyond our means. With creditors for charging us too much.  You get angry at the world for not letting you win the lottery. All this hopelessness can precipitate impulsive behaviour involving alcohol and violence. Even substance abuse, or illicit activities like illegal gambling and drug running.[1]

Considering all the above, doesn’t it make more sense to avoid unnecessary debt in the first place?

“How does it help…to make troubles heavier by bemoaning them?”


Make hay while the sun shines

What to do

Break the cycle and take control. Payoff your credit card and don’t make any further unnecessary transactions till you do so. Stop buying into the gimmicks and fleeting novelties. I’ve fallen into the trap many times myself and only recently paid my credit card debt. However, you may not wish to close your credit card in order to maintain your credit score and credit history. If you close your card it will probably affect your overall credit score.

Considering all that is said above, not all debt is bad. Not by a long shot. Especially if it helps generate more income and productivity. Buying a car if you can afford it is ok. Buying a house which appreciates in value is better than renting all your life, and may even generate income as you rent it out. Taking expensive vacations on your credit card which you have to pay for yourself in the end isn’t smart.  Sometimes you just have to use your common sense. As always, there is no replacement for professional assistance – in this case, from a financial adviser, according to your needs.

Seneca, suggested that we set aside a certain number of days each month to practice poverty. Take a little food, wear your worst clothes, and remove yourself from the comfort of your home and bed. Put yourself face to face with want, he said, you’ll ask yourself “Is this what I used to dread?”[2]

In doing so, you’ll discover that much of your fear is exaggerated and misplaced. To be sure, there are things in the world to fear and stay away from. But the number is usually far less than the imaginary horrors our mind and social programming conjure up for us. This exercise will also desensitise you to the marketing pressure of getting more and more clutter in your life. Saying “No” to the voice on the infomercial will get much easier.

Throughout this book and in later chapters we’ll discuss more strategies and systems for managing time and resources including our wellbeing, and cultivating positive habits that crowd out vulnerabilities. Our lives are too cluttered. This clutter occupies and divides your attention. It stifles creativity and flow of thought.



  • Avoid the credit card trap – be frugal like the Stoics
  • Draw up and stick to your budget
  • Avoid debt unless it improves productivity and measurable value for you