Apparently, we never learn.

I had a bit of downtime last week, so I decided to browse the interwebs for some juicy reading material. Buried between the stories of Hollywood breakups and shocking housewife confessions, I found an itty bitty headline proclaiming Americans had just crossed a dangerous money-related milestone. As a certified money nerd, I couldn’t resist clicking.

What I found scared the pants off of me.

According to the Federal Reserve, Americans have crossed the $1 trillion mark in revolving debt. For those who don’t know, “revolving debt” is (basically) credit card debt….and yeah, that’s “trillion” with a “T.” The number alone is scary enough, but here’s what’s even more frightening: This is the largest amount of revolving debt we’ve seen in our history.

Yikes.

Yep, the$1 trillion in revolving debt we now owe – $1.021 trillion, to be more precise – just passed the previous high-water mark of $1.02 trillion. Of course, the previous record was set in the year – say it with me – 2008. Total household debt has also climbed past the record set in the same year. Anybody else see a problem here?

So, What’s the Big Deal?

In case you’ve forgotten, 2008 was the year of the Great Recession (December 2007-June 2009). Remember that one – the worst economic downturn since the Great Depression? During that time, median household wealth cratered by 35%. Almost 8.5 million jobs were lost, and it has taken the better part of a decade to recover from the shock. By all accounts, it wasn’t a very good time for people’s finances.

What makes this so scary isn’t just the total amount of debt, although that should frighten anybody with a bit of sense. The biggest problem I see is that our behavior still hasn’t changed! We’re still buying things we don’t really need and obviously can’t afford. As an example, just take a look at our thirst for new cars.

At this time, we’ve far surpassed our previous highs for total auto loan debt, coming in over $1.6 trillion. To top it off, over 6 million consumers are delinquent on their car loans, eerily resembling the consumer behavior we saw around 2008. And while the auto loan and revolving credit industries hopefully pose less of a risk to the worldwide banking establishment, the fact is that these loans still pose a huge risk to us as individuals.

What is Wrong With Us?!?

Seriously, WTF you guys!!! This is freakin’ insanity. I know I’m probably preaching to the choir here, but are we so stupid that we can’t learn from our past mistakes?

One major reason that families have struggled since the Great Recession is that practically nobody is prepared for an emergency. Heck, the majority of Americans – meaning more than half of us – don’t have $500 saved to handle a mini-crisis, much less a full-on meltdown! Yet, there always seems to be enough money for eating out, cell phones, and cable TV. That’s absolutely unconscionable to me and, unfortunately, reflects our ridiculous priorities.

Hope for the Best, Prepare for the Worst

Now, I’m not saying that another Great Recession is looming next week. I’m not ringing the alarm bells, ranting and raving that you’re going to lose your job. I’m definitely not telling you to stop investing or pause your retirement savings. That’s not what this is about.

What I am saying is that we need to start learning from our past mistakes. We have to be prepared. Although we can’t predict or control the greater machinations of the market, we have a shitload of control over how we handle our own money situations.

Whether it’s a market downturn, a job loss, or little Johnny breaking his arm, you should prepare your finances during the good times so you can survive during the bad. Like it or not, those times are coming, so it pays to prepare in advance. Here’s a few ways to start.

Build an Emergency Fund

Your best defense against unexpected expenses and financial downturns is building a solid emergency fund. This is money that you set aside for things like a water heater dying, your car melting down, and even a job loss. Start by trying to save just $100. Keep building your fund until you’ve got a good “starter efund” of $1,000. Eventually, you’ll want to have enough to cover 3 to 6 months of expenses. That money can help get you through even the toughest of times.

Automate Your Savings – Having trouble getting started? Qapital is a free app that can help. Each time you make a purchase, Qapital can round the bill to the next dollar. Your bill gets paid but the extra change is automatically saved in a separate account you can use to start building your emergency fund. It’s a simple but effective way to start saving in no time. Use this link and receive a $5 signup bonus for getting started.

Create a Monthly Plan

If you’re like most people, you probably cringe at hearing the word “budget.” That’s cool, I get it. To over come this, think of your budget as a monthly money plan instead. Grab some paper and a pen, then jot down the amount of money you have coming in this month. Next, write down all of the bills you need to pay this month, estimating things like groceries and your electric bill. Boom, you’ve just created a basic plan. Throughout the month, check in with how you’re doing to help you stay on track. (If you’re into technology, you can use an app like this one to automatically track your spending.) It’s simple as pie and it could be the tool that literally changes your financial life! It definitely did for us.

Live Within Your Means

Want to know the secret to getting ahead in good times and bad? Live within your means. Better yet, live below your means. Spending less than you make sounds so simple, but most people fail to master this important money skill. (That’s why we have so much debt folks!) Creating a budget will definitely help, so snap to it! The beautiful thing is that you’ll stop spending on things that don’t matter, which means you’ll have more money available for the things that do.

Create Multiple Streams of Income

Americans have more credit card debt than at any other time in history, and that spells big trouble. Here's how you can do about it.Here’s another big secret for surviving tough times and getting ahead in general: Create multiple streams of income. Most people rely on their job as their only source of income, but as we’ve seen, jobs aren’t necessarily as stable as we think. It’s been said that the average millionaire has over 7 different streams of income. Now that’s stability. If one stream dries up, they still have 6 other income streams to draw from. Luckily, we’ve got a list of 99 ways to make extra money right here!

Stop the Insanity

Look, I love using credit cards. I love the points I earn. I love their convenience. I love the fraud protection they provide. But seriously y’all, we’ve got to get our shit together.

This addiction to debt and easy credit is destroying our financial security, both individually and as a nation. Digging further into debt means we have less freedom to choose, less freedom to spend, and we’re forced to work longer and harder just to pay back the money we owe. In a worst case scenario, we have to accept whatever our creditors gives us, which is the opposite of being free. Is that really what we want?!?

Seriously, it’s time to stop the madness! While the going is good, start preparing for the inevitable hiccup. It doesn’t take much. Just a little foresight is all you need to ride out the coming storm, whenever it may be.

What do you think? Am I being ridiculous? Did I miss something? Let me know in the comments below!