The CDC. The Center’s for Disease Control? Nope.
The Chronic Debt Cycle (CDC).
The family caught in a CDC is the type of family that is most capable of breaking out of debt, breaking out of worry, and breaking out of the CDC for-eva.
You can recognize a Chronic Debt Cycle– look for this…
… and the worst of the CDC breed– when you find yourself in $15,000 (or $60,000) of pure credit card debt, pay it off after a few years, then find yourself right back in it 12 months later.
… you go awhile without any debt, then a situation throws you back into debt. A situation such as a move to a different house, a temporary layoff or job loss, the sudden loss of other expected income.
… you only go into debt certain times of year- such as a Christmas time or if you are self employed you survive on credit cards through certain slow months of the year.
… your debt load goes up and down up and down up and down– but you never get it paid off. Something always comes up and it keeps you in Eternal Debt.
… you may have never had a credit card- but most of your furniture is paid for $20 a month over a period of years.
… car repairs or vacations make you pull out the credit card.
… you have a home equity line of credit that you periodically tap- then pay off.
If you have any of these (or many similar) things happening in your life then you are in your very own Chronic Debt Cycle (CDC). The good news is that this is the easiest kind of debt to get out of and stay out of.
The primary problem in a CDC is not lack of money- it’s just sheer lack of planning.
The easiest way out of a CDC is to use the Three Piece Plan. There are certain situations that I will address separately later- like for small business owners.