"Make it your mission to understand & invest wisely. Everyone has the potential to succeed in their search for true wealth & happiness & everyone can be successful in their pursuit of financial freedom." Contrarian Invest

Friday, 27 July 2012



For most, the temptation of using credit has been too alluring to resist, believing the benefits of using credit to finance a lifestyle they cannot actually afford, out-dazzle the drawbacks. Unfortunately, the truth and harsh reality of this fatal credit crisis has hit SA hard, as millions fall into the clutches of overwhelming debt and find themselves struggling to make ends meet.

Over the last 60 years, the growth of the global economy has relied heavily on credit consumption, propping industries and entire nations up on a shaky and unsustainable foundation. But, while the world was enjoying the heyday of credit induced economic growth and gluttonous living, no-one was asking, “What can go wrong?” Well, now we know the answer to that question and the future financial security of individuals, households, industries and entire nations, it doesn’t look pretty.

Marketers depend on consumers remaining ignorant about the devastating consequences of abusing credit. It’s become a world of ‘eat or be eaten’. If consumers stop buying goods and services on credit, entire industries will fall, putting millions out of work. If consumers continue to engage in the unrestrained use of credit to finance their lifestyles, millions more homes will fall into financial ruin. It’s a lose-lose game!
Despite the growing number of consumers who are becoming casualties of debt, marketers aren’t going to change their tactics. Industries are too heavily invested in the credit culture and depend on the ignorance of consumers and their ‘unconscious’ spending habits to sustain profits, growth and competitive advantage through credit purchases.

The responsibility now rests squarely in the hands of consumers to make smarter financial decisions if they wish to turn the tides on their strained financial circumstances or avoid falling into the debt trap. No-one else is going to take the lead on this! To make smarter financial decisions at the point of purchase, consumers need to develop a stronger presence of mind. They need to be more conscious of the future consequences of their financial decisions before they whip out their credit card and give in to the temptation of increasing their debt for the sake of instant gratification.

No comments:

Post a Comment

Warren Buffett Quotes

Leadership Quote of the Day