How People Get in Debt

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I was playing the game of Payday with a friend. For those who don't know this game, the board is a month. You go through the months and follow the directions on the spaces. Some are mailbox spaces. You draw the number of mailbox cards shown on the space. The things on the cards are those you expect to find in your mailbox -- bills, advertisements, etc. You only get paid $325 at the end of the month from which you have to pay all your bills. You can also buy deals, which are items you can sell when you land on a buyer space for the amount on the card. Some can double your money, some not so much. At the end of your month, you get paid and then pay all your bills. If you don't have enough, you have to borrow money -- at 20% interest. If you have money left over, you can open a savings account -- at 10% interest. You can only have either a loan or a savings account at one time. You cannot have both. My friend and I play until someone has $10,000 in savings. Tonight, I got hit in the first month with an $800 bill for my daughter's wedding and a weekend away for $125. That's $925 right there. You only start with $325, then get that at the end of each month. So, right there, I was in the hole. I had to leave money to get through the month and had spent some that month. So, with all the other bills, I had to borrow $800. the first month. Not the end of the world. But not good. The next month, I get the second story addition bill -- $500. Now, I am already paying $160 in interest for the first loan -- that is out of the $325 I would get. It kept going from there. At one point, I was $1300 in debt. My friend, right away landed on "Great Aunt dies, inherit $500." by avoiding big bills that month, my friend was ahead of the game. She could buy deals and increase her income that way. So, instead of waiting for my great aunt to die, or to build up some savings, I paid for a big wedding for my daughter AND put a second story on my home. This is how people in real life get into debt. They try to buy things they can't afford or do things they can't afford. They borrow the money to do it. Then they get further behind because they keep spending while also having to service the debt. The game had a somewhat happen outcome. I managed to land on some good space and make some money. Every spare cent I got, I put towards paying down that debt. Six months into the game, I was even. I ended the game with $1000 in savings. Now, in the game, you have no choice about spending. You get the cards you draw. But, in real life, you have choices. If you don't have the money, your dear little angel doesn't get a big expensive wedding. If you do go into debt for that wedding, you don't then put a second story addition on your house. You have control over your spending. Take it.