Paying off a large sum of debt is as much a psychological and spiritual endeavor as a financial and practical one. In considering different ways of paying off my student loan debt, I've come to understand that I need to rethink my relationship towards money and debt, and along with that, shift my attitude towards consumerism.
I've changed a lot in the past few years since graduating law school, but perhaps one of the biggest things that did not change in my thinking was my relationship to spending and consumerism. I always thought that I could justify purchases based on the assumption of future income and by paying off my credit cards in full. But what I didn't think about was opportunity costs. What could I have done with that money instead? Unfortunately, it took me a long time to realize that just because I could afford to pay for something in cash or pay off my credit card balance in full did not mean I could actually afford to purchase it. What I mean by opportunity costs is that by spending money I had on consumer goods, like clothes, shoes, makeup, etc., and on conveniences, like taxis and coffees at Starbucks, I forewent the opportunity of, for example, saving that money, investing that money, or using that money to pay off more of my student loan debt.
I've only recently realized that if I want to pay off my debt and make smarter choices for my life, I have to shift my way of thinking about money. I now think twice before I order another dress online. Not shopping and buying more clothes has forced me to get more creative with the things I already own at home, and has made me re-discover items in my closet that I forgot were there. Another thing that helped was de-cluttering my closet and donating clothes I hadn't worn in years to a donation center. Seeing all those clothes and thinking about how much money I had spent on them made me feel wasteful. And buying and storing all those clothes in my closet certainly didn't make me feel happy inside. If anything, it was something I did because I was bored and it just made me feel empty afterward. I've now found better things to do with my free time.
As an indication of how much I have changed, I went to a store the other day to pass time before meeting a friend after work and I felt so uninterested in the clothes. I just kept thinking that I simply don't need any more and that saving that money, or investing it, or using it to pay off debt, would make me far happier in the long run than a new dress would. I felt overwhelmed by all the stuff in the stores, and just kept thinking to myself, who needs all this stuff?! Our culture is so consumer-centric that sometimes it's hard to think outside the box and imagine that all this emphasis on shopping is culturally specific and often harmful in ways we don't like to think about. The deleterious environmental impact of the continual production of new clothes and the use of cheap labor in places like Bangladesh where a factory collapsed and killed over 200 workers are not things I wish to support or contribute to. That would not be in line with my values.
I have decided to take a more mindful stance toward consumerism. One way of doing that for me is to simply buy less. Another way of doing that is to buy things second hand. For example, I bought a second hand sofa from a nice couple last summer. It is like new, cost me way less than a new sofa, and no one can tell the difference. A third way to do that would be to only buy from socially conscious and responsible vendors, or local, ethical producers of goods.
Rethinking consumerism is a sign of maturity and indicates the capacity to step back and think critically about the everyday choices we make that have huge ramifications not only financially and in our personal lives, but also globally.
What are your thoughts on the excessive focus on consumerism in American culture?