So last time I talked about a little slice of my financial life; I talked about how I began my independence in debt (thanks to the student loan), and how I strived to surpass it while eking out a life on my own. I then described myself at the present; finally free of debt, and finally standing up on my own two feet completely. And what do I do? I think of taking out a loan.

So this is the American condition that defines many of us. We may be the land of the free, but many of us are in constant debt. You start out with a student loan, and then graduate to paying mortgages for your family. Toss in that loan for the car, and the education plan that we have for our kids, and you’ll realize that we are only as free as our debts allow us to be.

This is one of the main things that we must change if we are to get out of this recession. Debts, by themselves, are not too harmful to the individual and the nation. But if that same individual gets himself or herself in excessive debt, it could all blow up with a simple drawback such as temporarily losing a job.

There are only a few things more difficult than seeing things that you own repossessed; and all of it because you were unable to pay your debt? Avoid this possibility as much as you can! If you really need to get that loan, make sure that you have enough savings and extra income. Do this; and even if you do hit some bumps on the road, you’ll have enough extra to offset the loss.

We must learn to practice frugality, in the end. It’s not really that hard to do, all you have to do is start learning the balance between frugalities and keeping yourself happy. Don’t save up to the point that you buy nothing for yourself. Instead, reward yourself from time to time after doing things that you consider a good job.