Although I am often asked to speak to recent grads, I have never been asked to speak at any graduations. But if I were, I imagine I would deliver something along the lines of this speech.
Rule 3: Debt Sucks (your money away)
It turns out there really isn’t such a thing as free lunch: if something looks too good to be true, it probably is. So when the credit card company “gave” you the tee shirt or pizza along with the card with their logo on it, they weren’t being generous – they were being greedy.
Turns out that credit card is really expensive. That debt? You do have to pay it back. APR isn’t an abbreviation for “Any Particular Reason,” so you can’t say “I was going to pay for it later” and hope the bills will simply go away. As you will learn, the bills will quite simply go away when you quite simply just pay them off.
And the sooner the better. Every day you continue to owe that expensive debt is another day’s worth of interest you owe. It gets more difficult, not less, to pay back expensive debt, because it adds to itself. This is compounding interest in its evil form. You know pure evil, right? You’ve seen your arch-rival dance on your emblem at midfield or, worse, steal your girlfriend or boyfriend. Compounding interest is a wonderful thing when it’s working for you, but against you can be devastating. Choose to have it work for you. The less debt you have, the less it sucks.
[To be continued]
Tags: Graduation Speech