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Meeting Steve and talking to him about his recumbent trike, the Trice, reignited my desire to purchase a recumbent trike. The flames were stoked with multiple internet sessions where I looked at Terra Trikes, Catrikes, Trices, Green Speed Trikes, Hase Trikes, etc, etc, etc. The fire consumed me to the point where I was looking at trikes online before getting in the shower in the morning, before going to Church on Sunday, before going to bed at night, and during my lunch break at work. It was becoming an obsession.

I even went as far as to check eBay, as I am now a smarter consumer, and found “the perfect trike” for sale in Nashville TN for only $1750! That is a good price considering the same model retails for $4250 brand new. Man, I was excited. I started rationalizing the purchase, even though we didn’t have the money. I told myself that I needed it to lose weight, or that I needed it to save on gas. I was lying to myself. I even got to the point where I started to convince myself that buying it on credit wouldn’t be that bad of a decision. Since I am saving so much money on the purchase price I could easily afford the interest if I purchased it with a credit card.

I could sense that I was in trouble. To use Dave Ramsey’s analogy, I could feel the Cheetah, but I couldn’t see him. Dave came up with the Cheetah analogy after reading Proverbs 6:1-5 where the Bible tells us to get out of debt with the intensity of a Gazelle fleeing from the hand of the hunter. He then watched a show about Cheetahs on The Discovery Channel. It turns out the Cheetah only catches a Gazelle one time out of every 19 tries because the Gazelle runs away with such intensity. The point of the story is to keep yourself out of financial traps, e.g. Cheetahs, and to get yourself out of debt with intensity, like a Gazelle. Left to my own devices I would have ended up buying that Trike off eBay, and going into debt to do it. The Cheetah was stalking me and I needed help. I decided to call Jenn to discuss the purchase.

Thank God Jenn doesn’t have the same interest in trikes that I do. She looked at the eBay listing, told me it was nice, and agreed it was a good price. Then she threw my own words back at me. I hate it when she does that. She said even though it is substantially less expensive than a new trike, if we don’t have the money to buy it then it isn’t a good deal. She told me if I wanted it I would have to save for it. In short, she told me to delay my gratification.

I didn’t want to hear that. I needed to hear it, but I didn’t want to hear it. Jenn pointed out that I was letting a want, not a need, put me into a financial trap. This is not unusual in today’s society. Every day people go to the mall, or shop online, and purchase things they don’t need, and, more importantly, that they don’t have the money for. Instead of paying cash for their purchases they use a credit card which charges them interest, and in many cases a lot of interest, on the amount they borrow.

This consumer mentality can be very powerful. The urge to fulfill our wants is being actively cultivated by marketing departments in our culture. If you don’t believe me then just take a look at the advertising all around us. I consider myself fairly immune to the marketing ploys of todays culture and yet I was about ready to fall prey to a Cheetah in the form of a trike. Do you want to know how powerful the buying urge was for me? I was ready to plunk down $1750 dollars, with credit card interest rates, on a trike I have never even ridden! Yep, I was so consumed with the desire to have a Trike that even though I have never ridden one, not even a test ride, I was ready to buy one because it was such a “good deal”. Bah! How frustrating! I know better! Thank God Jenn was there to provide a balanced perspective!

So what am I going to do about a new trike? The same thing we are doing for all of our big purchases from now on, save for it. We are going to sit down in one of our “budget meetings” and decide how much the Trike will cost, how much per month we can set aside for it, and then how long it will take to save that amount of money. Once I have the cash in hand I will walk into a store with cash and get a deal. Either that or I will search eBay for a Trike once I have the cash. Either way we will not use credit.

Jenn and I didn’t always approach purchases in this way. In the past we allowed ourselves to buy whatever we wanted, or at least whatever the credit card limit would allow, any time we wanted it. We were sold on the idea that credit was a part of every day life, and that your credit score was integral to your success in our society. We were following a lie. Credit is not a necessary part of life. Credit, especially credit cards, are just profitable products that are cleverly marketed to you. How profitable? Allow me one short demonstration and you will see.

Your bank pays you a small interest rate on money you deposit into a savings account, say 2.5% per year. So, if you deposit $100 at 2.5% then at the end of the year you will have $102.50. Meanwhile, the bank takes your $100 and loans it out via a credit card to you at 18.5% per year, or more. I have seen credit card rates as high at 28%! If you pay the minimum on the card, and then at the end of the year you pay off the $100, you will have paid the bank $118.50. Lets multiply this example out over $10,000 instead of just $100. The interest they pay you at the end of the year comes to $250, while the interest you pay them on the credit card comes to $1,850! That is a difference of $1600! Multiply that out even further by looking at compound interest terms, and the fact that many people carry a balance over for years, and you can begin to see how profitable a credit card really is to the bank. It also explains why they market them so aggressively. They don’t want to loan you money because they like you, or because they want to help you get a better credit score. They want to loan you money so they can charge very high interest rates and make a lot of money.

This is one of many lessons I learned from Dave Ramsey’s Financial Peace University. I highly recommend you check him out at www.daveramsey.com. Jenn and I first encountered Dave Ramsey via my Brother. He loaned us a copy of the Dave Ramsey CD set that comes in the Financial Peace University kit. We were carpooling at the time, so we listened to the CDs together in the car on the way to and from work. We didn’t have a video, or a book, or even a note pad to write on, and yet listening to his CDs changed our life. We are now on track to financial peace all thanks to Dave Ramsey’s course.

Jenn and I are believers. We urge everyone we know to go through FPU. Anyone who is getting married should go through FPU. Kids should go through FPU For Kids. Singles, married couples, divorce’s, everybody needs to know how to handle their money, or the lack of understanding will ruin you financially. Heck, even the two church small groups we attend are going through Financial Peace University. When our small group joined it was $99 to go through his thirteen week course. You might think that is high, and initially I agreed with you, but since we first heard the CDs in my car we have paid off over $10,000 in debt, we will be debt free by June 09 (with the exception of our house payment), and we will have a retirement income of millions of dollars by age 65. None of that would have happened without the principles laid out in Dave’s course. It turns out it was well worth the $99. If you are still undecided ask yourself this. Do you want to pay $100 now and be rich when you retire, or do you want to “save” $100 now so you can be poor the rest of your life?

One final note. One of Dave Ramsey’s favorite Bible verses, which is quickly becoming one of my favorites, is Proverbs 22:7 which reads, “The rich rule over the poor, and the borrower is servant to the lender.”(NIV) How true. The banks ruled over Jenn and I’s marriage for 10 years before we stopped them. Since we started following Dave Ramsey’s FPU principles we have stopped fighting about money and can see a bright financial future. I don’t want to be a servant to the banks ever again.

What about you? Are you a slave to the lender? Do you want to continue to be?

- Sean