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WARNING SIGNS

There are a number of warning signs along the road to debt, but they go mostly unnoticed until we're already in serious trouble -- until we're unable to meet our bills, pressed by angry creditors, or threatened with legal action. If more than a few of these apply to you, or if any are routine in your life, then you have a debt problem or are likely to be on your way to one.

IS IT THE 15TH ALREADY?

This month's bills start coming in before you've cleared last month's. You meant to get to them, but you got caught up in other things. You're surprised to find that the phone bill is still there. Somehow you didn't get to the rent or send the dentist his check. You're frustrated when you begin to write the checks. There are more bills than you thought. It seems you're always behind.

• You know what past-due notices look like.
• Your bank has been informed that you haven't paid your property taxes yet.
• Your American Express bill shows a balance from last month and reminds you that payment in full in required upon receipt.
• The hardware store sends a letter telling you you're in arrears and requests that you send a check at once.

These rarely surprise you. You don't slap your forehead and say, "Oh my God, how could I have forgotten! Uh-uh. You're familiar with this kind of communication, and your usual response is annoyance, depression, or frustration.

You've had to get on the phone and argue, apologize, or express your indignation because the telephone or utility company is going to cut off service unless payment is made immediately.

You've paid a certain bill only after receiving a threat from a creditor's legal department or a collection agency.

You resent your bills in general. You often say to yourself, "They just don't stop!" or "God, won't they ever leave me alone?"

THE UNOPENED MAIL

You avoid opening letters for fear of new bills or trouble with a creditor. The only mail you're truly comfortable with is from friends or relatives -- unless you owe them money too. Bills and letters from creditors get put in an ever-increasing pile on a corner of your desk or dumped into a drawer.

Larry, a chain-store manager, used to put his into a shopping bag. He had two bags stuffed to capacity when he began this program -- practically every bill and pastdue notice he'd received in the previous year was packed into those bags. He was $29,000 in debt at that point.

This is the ostrich syndrome, sticking your head in the sand. As long as you don't have to see the bills, you can tell yourself they're not there. This syndrome can become so pervasive that any communication of a potentially financial nature becomes a threat. The possibility of a neutral or even beneficial contact never occurs to you.

Six months after she had stopped debting, Mona, a florist, was still so gripped by this fear that she panicked when a letter from the IRS arrived. She wouldn't open it for a week. Her anxiety mounted each day. When she finally did work up the courage, she found it contained a refund check for $166. Years of debting had left her nearly incapable of conceiving that an envelope from the IRS could contain anything but a demand for more money.

THE UNBALANCED ACCOUNT

You rarely keep a running balance in your checkbook. You hardly ever reconcile your balance at the end of the month when you receive your statement. You tell yourself it's too much trouble. Or you simply don't want to see the bad news. Consequently, you never know how much you actually do have in the account. Somewhere around a thousand, you think, if you're willing to think about it at all. And that guess usually substantially overestimates the real amount.

This is a numbers game. You pretend you have more money than you really do. It was one of my own favorites. I did keep a running balance in my checkbook. But what I also did, and what other numbers players do, was delay writing checks until the last possible moment, until I was on the verge of incurring late charges, calls from creditors, or cancellation or shut-off notices. By hanging on to the money, I could look at my checkbook and see that I had a comfortable margin of around $2,000. Everything was okay, right? I had enough.

It was a con job. I didn't do it consciously, but I did it nonetheless. The sense of security it provided was false. If I'd paid those backlogged bills immediately, my balance of $2,000 would have dropped by $1,000; and looking at that, I would have been forced to confront the uncomfortable fact that $1,000 was all I had left with which to face $2,500 worth of expenses and incoming bills -- that I was going to come up short for the month by $1,500.

The numbers player defends his balance fiercely. He resists mailing the checks until he absolutely has to. That imaginary balance is necessary, if he's to have any comfort or relief at all.

NOT MUCH DOWN

At one time you paid cash or wrote a check for most of the things you bought, especially smaller items like a purse or a Walkman. But now you charge most of them to your credit card or store account.

When you purchased a large item such as a freezer or car you used to make a sizeable down payment, keeping your monthly installments low. But you don't do that anymore. Your down payments have grown smaller and smaller, your installments larger. If you're offered a choice of time periods in which to pay, you'll take the longer period instead of one, three instead of two.

You search for items offered at lowered down payments or on lengthened payment schedules. You consider yourself a smart shopper because of this. When you find one, you're pleased that it's within reach now.

THE DEPARTMENT STORES

The total amount you've charged at any given store, or at several stores, has been rising steadily. Rarely do you ever reduce your balance to zero. It may come down for a while but all that means is that you have some maneuvering room. Soon there's something else you want or need, so you buy it, charging it, and the upward drift begins again.

CASH ADVANCES

You use your credit card, or the overdraft privileges on your checking account, to obtain spending money or to pay a pressing bill while you're "stretching through."

A COUPLE OF BUCKS TILL TOMORROW

You're frequently short by a few dollars. So you regularly borrow small amounts of cash from family, friends, and co-workers for a day or two.

IT'S THE ADULT THING TO DO

You associate charging and the use of credit with maturity and success. Your American Express card informs the world that you're someone to reckon with. You're proud of your top-of-the-line cards: your gold card, platinum card, premium card, preferred customer card. They don't give credit to losers, do they? You get a high when you whip out your card, a rush of good feeling when you tell a clerk to charge it.

An invitation to accept new credit pleases you -- especially when the letter informs you that you've been selected for this privilege because you've proven yourself a person of worth, accomplishment, and responsibility. You're proud that you've been preapproved for credit and that all you have to do is sign your name and return the agreement.

- You have a variety of credit cards -- Visa, MasterCard, American Express, Mobil Oil, Carte Blanche, Diners Club, United Airlines, B.F. Goodrich and others -- and charge accounts at several local department stores. You're always interested when you hear about a new card and wonder if you have a need for this one too or might be able to put it to good use.

IF ONE IS GOOD, TWO ARE BETTER

You have more than one Visa or MasterCard. You hold the extras in reserve, bringing a new one into play when you reach the maximum credit on the old one. A variation is to spread the total amount of your charging across three or four Visas or MasterCards issued to you by different banks.

You have an inordinate sense of accomplishment over meeting routine financial responsibilities like rent and utility bills. You're proud of yourself for paying for the basics each month -- food, shelter, and clothing. You feel you've done something impressive.

MONEY IS A PERSONAL MATTER

You find money an embarrassing or unfit subject for conversation. You're reluctant to participate in what should be a normal discussion about money. You view any mention of personal finances as a breach of etiquette, and you remove yourself from the situation if people begin to talk about it.

Even the thought of ever telling anyone how much you make or how much you owe makes your heart pound, your breath go shallow.

THE CANCELED ACCOUNT

A bank has canceled your credit card or a store has canceled your charge account because of nonpayment or repeated late payments. You're either depressed or angry about this, and may claim that they treated you unfairly, that the fault is theirs.

SAVED BY THE BELL

You frequently dig in and wait anxiously for the next money you expect -- a paycheck, commission check, contract payment, or even a loan. You hold off paying bills, you tell friends and creditors you'll have the money shortly. And when the money does come, you experience a great sense of relief.

WHO KNOWS WHAT THE DETAILS ARE?

You're largely ignorant of the terms of your various loans, credit card agreements, and charge accounts. You don't know how to read a statement, what the various figures on it mean, which ones tell you what portion of this month's payment goes toward the principal and what portion to the finance charge. You don't know what interest rate you're paying Visa, for example. You don't know how many months it will take you to pay off the jacket you charged at Montgomery Ward. You don't have any idea what the difference is between simple and compound interest.

Usually, most of what you know about your credit arrangements is how much your top limit is.

MINIMUMS

You rarely write a check against a charge account or credit card balance for anything more than the minimum payment due. Your balance generally hovers near the maximum. If it does fall, you charge something new and it shoots right back up again.

NEXT MONTH IS NEXT MONTH

You're not concerned about bills that don't have to be paid this month. So long as you can make this month's payments, everything is just fine.

You're caught off guard, you're annoyed and feel pressured when the calendar changes, and suddenly you realize this month you have to face property taxes, an insurance premium, a business trip, a birthday, or Christmas shopping, something you "knew" was approaching, but that somehow you didn't give much thought to and for which you're now unprepared.

You have little or no savings, investments, or assets. There's nothing for contingencies. One serious hit -- losing your job, a fire, a medical emergency -- would wipe you out. Month by month, practically every dollar you get in goes right back out.

KITE FLYING

Circumstances sometimes force you to kite a check -- write one for more money than you actually have in the bank. This takes different forms.

It's Thursday. Sheila gets paid every two weeks. Payday is tomorrow. She has $5 left in her checking account and just enough in her purse to make it home tonight. But she has to pick up a prescription from the drugstore, she needs something for breakfast, and she's going to a friend's home for dinner, which means, since it'll be late when the evening's over, that she'll want to take a cab home.

So she stops at the supermarket, buys a few things, and writes a check for $20 over the register, which gives her the added cash she needs. She figures she'll deposit her paycheck tomorrow afternoon, that this check won't reach her bank until Monday, and that by then there'll be enough in her account to cover it.

Ray, on the other hand, has had a lot of unexpected expenses and hasn't paid his garage bill for a couple of months. He's told he has to or he can't park there anymore.

Even though he won't have the money to cover it for a couple of weeks, he writes a check. He knows that by the time the check reaches the management company and is entered in their computers, deposited, and returned from his bank because of insufficient funds, he'll have the money to write the company a new one.

Ruth has yet another way. She's been using the same dry cleaner for several years. When things are tight, she postdates a check to pay for her cleaning. The owner doesn't mind holding it until it's good because she's a steady customer.

Ted sometimes deliberately puts the wrong checks into return envelopes -mixing up the checks to MasterCard and the telephone company, for example. That buys him another two weeks while the mix-up is straightened out, by which time he can usually get the money into his account and cover everything.

No matter the form, it all comes down to the same thing: You write checks on funds you don't have.

BOUNCING RIGHTALONG

Heather, who works in television production, holds the all-time record for bounced checks among people I know. Before she began this program, she bounced 201 checks in a single year. She made good on every one of them; but still, you could have played a game of handball with practically any check she wrote. She also paid her bank more than $1,000 in bad-check charges that year.

Clearly, Heather's an extreme. You don't bounce more than twenty a year. Or ten. Or five or six. And everyone bounces a check now and then, don't they? No. Most people without a debt problem hardly ever do.

I CAN'T KEEP TRACK OF IT ALL

You have only a vague idea of your various financial obligations and responsibilities. It's all too complicated to keep in mind. You have difficulty relating them to the funds that are actually available to you.

You don't know what it costs you each month to live, or how that stacks up against your income.

THERE'S ALWAYS SOMEONE

Your finances and bills are nettlesome, even upsetting, but you feel that you won't ever get into real trouble because there's always someone to turn to: your spouse, your parents, your brother, your sister, a good friend, someone you're close to who has money and who won't let you go under.

My good friend's name is Bob. He sent me a stock certificate to use as collateral when I was out of money and needed a $10,000 loan from Chemical Bank to live on while I finished a novel, and sent another certificate when I had to kick that loan up to $17,500, and later a personal check for $500. That accounted for $18,000 of my debt. There's always someone.

BUT I CAN'T DO IT ALONE

You believe that for some special reason you are different, that you can't handle all these bills and obligations by yourself, that you need someone to help you.

• You're no good with numbers
• You don't have a college degree
• Women were never taught about money
• You have a serious medical problem
• Your expenses are extraordinary
• Your field doesn't pay very much
• You have too many responsibilities
• You're only a couple of years out of school
• You're too old
• You're divorced, and you can't make it without your husband's income
• You're divorced, and you have to pay alimony and child support

Any reason will do. What counts here is that you have a reason; there's something about you or your situation that makes it impossible for you to avoid going into debt. These-are the most common warning signs of a serious problem with debt. It's not necessary for all or even a majority of them to apply to you. I only hit a few myself; so do most others who are in trouble with debt. We're all unique, we each have our own personal styles, forms, and combinations.

How many times did you see yourself here?

Obviously, no one wants to have a problem with debt. Any practically everyone's first response is to deny or justify it somehow. That's eminently natural: Who the hell would want this?

Debt can be extremely painful.

It's also wholly unnecessary.

Your debts, whether you believe it or not at this point, are not crushing or hopeless. They are only a problem -- and one for which there is a solution. But no one ever eliminated a problem until they recognized, or admitted, that there was a problem.

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