What does being “debt responsible” mean, and how do you do it?
Being debt responsible means taking responsibility for your debt and it’s payoff without making excuses or trying to find easy ways out through debt write-off, negotiation with creditors, or bankruptcy. In a nutshell, if you signed on the dotted line, you must pay it off.
Why must you be debt responsible? The most commonly referenced reason that you must be debt responsible is that, by signing the note, you were guaranteeing that the debt would be paid. You also accepted the conditions of repayment. Some of those conditions, such as interest rate, are somewhat negotiable even after you sign the note, but not the amount of the actual debt. The most important reason for being debt responsible (to me at least), is the moral requirement. Morally, whether you look at it religiously or secularly, you have a responsibility to repay the debt. Again, it goes back to your acceptance of the debt and it’s conditions. Morally, you have a responsibility to uphold your part of the bargain.
Luckily, for most of us, it’s extremely easy to be debt responsible. We just have to pay our bills each month. But what happens when an emergency strikes and you can no longer pay your bills? That depends. Can you really not pay your bills, or can you not pay your bills because you have to go out to Red Lobster next Thursday? If you really, truly cannot pay your bills, you have what is one of the only exceptions to any of the above rules. You are free to negotiate as much as possible to reduce your payments, delay your payments, and even reduce or eliminate your interest payments. Only in the most extreme cases should you try and reduce the debt or eliminate the debt.
Being debt responsible isn’t always fun. (Who am I trying to kid? It’s never fun.) But, it’s the right thing to do, not just morally, but for your personal finance as well.