Consolidating debts hull
The rewards system in the brain, the mesotelencephaic dopamine system, gets dulled to the experience, requiring increasing amounts of the good stuff to get the same high that it got previously.Have you ever known someone who only smokes when they go drinking?
There continues to be a debate about whether or not the “snowball method” of paying down debt by paying off the smallest debt first as espoused by Dave Ramsey is practically superior to the mathematical approach of paying off the highest interest rate debt set forth by mathematics.I chose to do so, but I also was caught in a cycle of consumption which was very difficult to break.I had a cycle of paying down debt, or even completely paying it off, only to dive headfirst right back into the credit card pool and run the debt right back up, getting on the phone, and begging the credit card companies to raise my credit limit like some lovesick teenager begging his ex-girlfriend to come back to him. People get to a point in debt where they have no idea how they got there, have tried to get out, and don’t have a clue what to do next.You could do a lot worse than living by the Dave Ramsey approach to eliminating and avoiding debt, such as, oh, getting into more debt.However, recent research by a team of academics including Duke’s Dan Ariely, a professor for whom I have a high amount of regard because of his research on the psychology of personal finance, caused me to start to question my heretofore unwavering support for the Ramsey method of using psychology to triumph mathematics.Maybe the “debt snowball” doesn’t work as well as it could.
Maybe paying the highest interest rate card doesn’t work.
The credit card equivalent, according to Dave Ramsey, is to pay off the smallest debt first so that you can have a win, gain momentum, and feel good about what you’re doing.
It’s a psychological trick, since, after all, if you acted in the way that you knew you should, you wouldn’t have been in debt in the first place. Ramsey, if you believe all of the callers to his show who scream “I’M DEBT FREEEEEEEEEEE!!!!!!
According to the National Institute for Health, addiction is based on a pattern of compulsive behaviors based on seeking and indulging in whatever you’re addicted to.
Addicts have trouble stopping their behavior, or even reducing it, and even if they’ve stopped for a long time, it’s not difficult for them to fall off the wagon and get back into the old habits.
Some people can try a drug and never become addicted, and some can try it once and become hooked.