I'll get right to the point: we are a nation of debtors. We're up to our eyeballs in debt; and we have only ourselves to blame. No one put a gun to our heads and made us spend so we can't blame our present condition on our parents, society or economic conditions. The sooner we admit we have a problem, the sooner we can get help.

Why are we experiencing our own personal "credit crisis" today? We'll talk about the reasons, not as a way to shift the blame, but more or less as a way of gaining some understanding. Then we can move on and do something about it.

We'll talk about the ways and then the means of debt.

First, the way: We are blessed in this country with freedom, democracy and free enterprise. It is truly a land of plenty. There are so many wonderful things available to us—cars, homes, clothing, food, entertainment and things, lots of things—and we want them. As you take one thing off of your wish list, there are another two things to add.

And the means: There is ample opportunity in North America to exercise our right to spend. And, let's face it; we believe in exercising our rights. There are also plenty of ways to fund our spending. We have mortgages, car loans, leases, rent to own, lines of credit, bank and retail credit cards (by the wallet full), "buy now, pay later" incentives, consolidation loans, payday loans and pawn shops...

Many things + limited cash + ways to borrow = lots of debt...

The purchasing mindset has changed over time. People once saved their money first and then made their purchase. Today the norm is to buy now (with someone else's money) and pay later. What accounts for this change? Here are some reasons as we see it.

As we made the move from rural to urban centers, we naturally spent more time in close proximity to our neighbors and began to experience the "Keeping up with the Joneses" phenomenon. We had a clear view of our neighbor's possessions and in order to feel that we were just as good as they were, we needed to have what they had. There are two major problems with this. We shouldn't decide what we want based on what other people have and purchases should be based on need and our ability to pay.

We also have a significant increase in leisure time—we have a lot more time to play and we want something to fill our time with—electronics, video/computer games, music, entertainment and toys. Advertising, a billion dollar industry, fuels our wants and desires for more. Advertisers are paid to convince us that our wants are actually needs. Superstars and the rich and famous flaunt their wealth and create an unrealistic vision of the "good life" that certainly we also deserve to enjoy.

For these reasons, and many others, we want to have it all, whether or not we can afford it. And so we buy happiness, at least temporarily, with a credit card. When we spend we feel like we have money. There is a natural "high" that comes when we purchase new things. We satisfy ourselves now without thinking about the future. We might reason that we are already in debt, what difference will a little more make. We deserve it...etc. We're sure that you can add some of your own ideas. If this is where you are at, it's time for an attitude adjustment!

P.S. The first chapter of our personal finance book: Power Spending: Getting More For Less, is about money psychology. Eric, Robin and I believe that if people don't get their priorities straight they will never be in control of their finances. A positive state of mind in this area, as in anything in life, will be the single best determiner of your success. We want to help. There are two sections: Social Conditioning and Living Within Your Means. You will understand why you need to make changes and how you can make them so that you can achieve your financial goals.