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I HATE BEING IN DEBT. It makes me feel anxious and uncertain, as though my finances are out of my control. If I don’t pay all my bills in full every month, I feel trapped, and I’m endlessly restless until I get free.
I understand that other people manage their finances quite differently, and are happy to pay their bills in installments. Not me.
Years ago, I made a small bet on a minor thing. It was during a celebration with friends and family. There was some back and forth with a family member that culminated in me saying, “I’ll bet you a dollar on that.” The bet was accepted, and I lost.
I immediately stood up, pulled out a dollar bill and insisted it be accepted. My gesture came in the middle of dinner, in front of the other guests. It created an awkward moment. I later realized I’d felt compelled to pay my debt right away and in front of others, because I didn’t want to be known as someone who didn’t pay a bet.
I also didn’t want to be like my father.
When I was a child in the 1950s, I learned that my father owed money. He came into the bathroom, and I watched as he used the sink to burn some bills he owed. Not long after, he deserted the family, leaving behind my mother, me, my sister, my brother and a mountain of debt. My story of the bill burning was part of the evidence used in the divorce proceedings that followed.
Unfortunately, the debts didn’t go up in smoke along with the past due notices that my father burned. My mother paid what bills she could, and friends forgave personal loans. I don’t know precisely what happened to the rest. Still, despite our poverty, she paid regular installments for years.
In my desire to differentiate myself from my father, I resolved never to owe money under any circumstances. Small wonder then that I’d rather make a spectacle of myself paying off that silly bet.
While I abhor debt, I make several exceptions. We have a mortgage on the house, but my anxiety about the debt is allayed because I view the mortgage as a contract we’re fulfilling.
I also have “debts” in the form of my annual pledges to charity. Those must be paid in full, but I pay those obligations on my own schedule over the course of the calendar year.
I also make an exception for medical bills. In early January, I had surgery to fuse all my lumbar vertebrae. Now full of rods, screws and bone spacers, I’m progressing through a long and challenging recovery. I don’t fret about the resulting medical bills, including those for post-op therapy, when they arrive in the mail. My health insurance will cover the majority of the costs eventually, and I’ll handle the rest in due time.
I’ve learned not to send money immediately when I receive a bill for medical services. That only confuses matters. Waiting for the final explanation of benefits before sending any payment makes things go more smoothly. This can take quite some time, but I accept the need to wait for the final amount due.
Sadly, millions of people in this country don’t have good health insurance and end up with astronomical medical debt that they can never pay, assuming they’re able to get treatment at all. Debt becomes their prison.
In gratitude for my situation, I contribute to Undue Medical Debt. This group has been buying up medical debt owed by individuals and families. They’re a four-star charity on Charity Navigator. Communities, counties and states are joining the movement.
Contributions to this charity help erase billions of dollars of medical debt for individuals and families. I view my contributions as carrying on the help that my family received when I was a child. With my donations, I help to break the yoke of debt for others, open the door to their debtors’ prison, and allow them to go free.
Tom Scott is a retired Episcopal priest. He and his wife live in Evanston, Illinois. They love retirement because they get to see more of their children and grandchildren, and they can spend more time at concerts, the opera and the Chicago Botanic Garden. Check out Tom’s earlier articles.
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Another piece of advice that we learned this year is to save money for the January onslaught of prescription costs that are included before reaching the catastrophic level. We had updated my husband’s insurance to my state pension one, and got caught with an $8K bill by March for 90 day refills. Previous years, we had been refilling his medications monthly.
In principle, a dollar bet is as significant as a thousand dollar bet. If you make a bet and you lose, you pay what you owe. Otherwise, your integrity becomes suspect. It doesn’t matter if the people around you are uncomfortable. This is about your honor, not their comfort levels.
But let me add one peripheral observation about these kinds of small bets. Some may scoff at this, but I learned from a wiser friend (who often made bets) as I entered my 30s that if you WON a bet, you needed to collect what you won. That is almost as important as paying what you lose. Until then I was often the person who said “never mind”, or I often had people suggest that they didn’t need to pay, since it was all in fun, and I deferred. But anyone who does that is walking down a one-way street, going the wrong way. You always pay, but never collect.
I took my friend’s admonition to heart. I found nice ways to make sure I collected. As I got older, I was shocked at golfers who lost bets who tried to slip away. It truly is a measure of honor and integrity to pay, and they failed. My rule was usually to collect (or pay) before we walked off the course, or in some cases, before we left the lunch table. It is important to settle things in both directions. The funny thing is that no one really complained about being held to task.
One of the many absurdities of the medical system in this country is those who are uninsured and least able to pay are expected to reimburse medical providers the full sticker price for services. These providers meanwhile never expect to be reimbursed for the list price by insurance companies that are best positioned to pay.