Posted: Friday, November 8, 2019. 3:28 pm CST.
By BBN Staff: We all have debts, whether the money is used to pay monthly bills, to facilitate our lifestyles or to invest in our education, a home or a business, the way we consider and handle debt in the jewel is sliding down a dangerous slope.
It is widely said that borrowing is sweet but the act of repayment is bitter. Some Belizeans enjoy taking loans but after missing one payment, then another and another, it becomes difficult to catch up with payments.
The developing culture of irresponsibility and unwillingness to align our priorities and pay bills is a threat to our reputation and credit history, but is also a menace to businesses in Belize. If you borrow money from someone, or take something on credit, you are supposed to pay for it. Encouraging a culture that is different than paying for what you owe, is a dangerous slope to slide. The recent case of University of Belize students not paying their fees, despite continuous warnings, and facilitation by the University, is just one case in point. There in no doubt, that many of the students who are not on the list, may be in a worst financial position, but these students put paying their fees as a very high priority.
Any business owner can attest to the numerous clients who appear to be genuine when asking for credit, and then disappear without even trying to pay a cent. Many hard working Belizeans can also attest to individuals using all kinds of tactics to borrow money from you and then it becomes next to impossible to collect. Many stores around the city and towns display names of residents who have taken items and disappeared or simply refused to make payments. Their names are displayed on the infamous ‘Malpago’ list.
Looking at it from a business perspective, having to write off a bad debt after the debtor has used the materials or services is a major loss to that business. The person not only goes with your profit, but you still have to pay your supplier for the items you credited the customer.
Many of us have problems with aligning our priorities. We would prefer to have an Iphone, or going clubbing every weekend and squandering our money and these should not be the most important things in our to do list. Rather paying the money we owe, whether it be our monthly bills, mortgage or items we credited, or our university fees should be one of our highest priority.
According to Forbes magazine, the most important personal finance goal is to spend less than you make, and the second is to save a small amount of money every pay cycle. With the latest trends in smart phones, modern technology, fashion, dining, clubbing and soca/dancehall artists, some Belizeans are spending more and more than they make, and are paying less attention to paying the essential bills.
The truth is that many Belizeans are living from hand-to-mouth, meaning making just enough to survive and take care of their families. And getting indebted for anything that is beside a small business investment or a medical emergency becomes another burden to the family.
It is now becoming increasingly challenging for the average Belizean to take out a mortgage to build a decent home. Each week, the banks publish the names of people whose homes are being sold off due to non-payment of their mortgages. Losing a home is a big deal but a debtor signs off on the financial institutions conditions when receiving the loan, and has to reflect on whether they can meet these obligations in the long haul.
With the season of Christmas fast approaching, avoiding and tackling debt should be a priority.
Ignoring debt could wreck your financial stability because late fees and interests can turn a small debt into an overwhelming one. From the highest levels of government, to the board rooms of companies and businesses, to the dining hall in the home, let’s all begin to have a culture of debt responsibility, and repaying or making plans to repay what we owe.
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