NationStates Jolt Archive

What do y'all think about debt? is it unavoidable in today's modern world? is consumer debt too high (it being about the highest its ever been in most western countries)? can you live your life without getting in debt? is debt all that bad or can you live with it no problems? how do you think debt affects different portions of society and the economic spectrum?

What do y'all think about debt? is it unavoidable in today's modern world? is consumer debt too high (it being about the highest its ever been in most western countries)? can you live your life without getting in debt? is debt all that bad or can you live with it no problems? how do you think debt affects different portions of society and the economic spectrum?


You can aviod debt, if you do not buy a house.

Myself I have no debt, no morgage, no credit cards, no loans. It does mean though if I have not got the cash I can't have it.

That though is not a problem, I grew up poor, and my perants never really had the cash for anything, so it's not such a hard lesson for me to have learned.

I've managed to avoid debt so far, I'm at the end of a university education. Although I wouldn't have been able to do it without help from my parents.

I think I owe a little on credit cards, but that's it.

Eventually I'll probably want a house... which will totally saddle me with debt for most of my life. :(

Student loans, for most people, will be unavoidable if they want to go to university. Even if, like me, their parents are fairly well off and can help you out with cash, and you work whilst you're at it. I was a student in London, the loan didn't even cover my rent; I was paying more then than I do now...

If you want to buy a house a mortgage is pretty unavoidable, too.

But everything else? If you want it, save up. This includes cars; I hear quite a lot of people mention car loans. Why? My last car was free, and I've never spent more than £225 on one (my old Fiat Panda. That was a good car, it lasted three years).
And anyone taking out a loan to buy a computer is a Complete Certifiable Moron. Really.

But most dire debt is people's own stupidity; not thinking about it properly, doing the maths, and working out what you can afford. If you can't do the maths you are too stupid to borrow money. So don't. And if you do, don't whine and be surprised when it fucks you over.

But most dire debt is people's own stupidity; not thinking about it properly, doing the maths, and working out what you can afford. If you can't do the maths you are too stupid to borrow money. So don't. And if you do, don't whine and be surprised when it fucks you over.
that or unforseen circumstances. like house prices falling for the first time in over a century in a recession, forcing you to sell a house for less than you paid for it because if you don't the banks will take it anyway. and losing all your clients in europe due to black wednesday.

circumstances outside your control can really fuck you over, and you get in more debt than you can handle just to stay alive and not go bankrupt or live on the streets.

I've managed to avoid debt so far, I'm at the end of a university education. Although I wouldn't have been able to do it without help from my parents.

I think I owe a little on credit cards, but that's it.

Eventually I'll probably want a house... which will totally saddle me with debt for most of my life. :(
well there you go - house prices are ridiculous, and landowners have far too much legal power meaning renting is just horrible (yes i have rented)

tis a real shame there's no more student grants, too

That though is not a problem, I grew up poor, and my perants never really had the cash for anything, so it's not such a hard lesson for me to have learned.

as you may be able to tell from this post, i grew up with my family in debt. in fact i think that's about all i'll inherit from my parents one day. and its horrible to live with when you're too young to do anything about it :(
now i'm old enough all i want to do is get away, but to what.... just my own debt. great. :rolleyes:

I work for Barclaycard and am in fact posting from there now and my advice is that if you see a credit card then run, run like the wind preferably while covering your arse because the credit card company will definetly be trying to find a way to fuck you anyway.

I've been to university, and since I don't have rich parents, or any other similar source, I am £22k in debt. Thankfully, it's unsecured, so I'm really only paying back a bit each month, and I'm not in dire trouble if I become jobless.

Debts! Had them once, now I don't. I have a credit card but use it for convenience rather than for things I can't afford. Have a house and a car, no mortgage, so things are pretty sweet, until my kids go to University I guess

What do y'all think about debt? is it unavoidable in today's modern world? is consumer debt too high (it being about the highest its ever been in most western countries)? can you live your life without getting in debt? is debt all that bad or can you live with it no problems? how do you think debt affects different portions of society and the economic spectrum?

It's a more abstract form of indentured servitude for individuals. For companies, it's a means to do more with less, if you manage things correctly.

I avoided debt so far, but that might change sometime in the future if I ever decide I want to buy a house.
I don't put much value to most money-swallowing activities, most of mine goes to the purchase of books. I don't have a car, I don't drink much, I don't have many clothes shops that will stock my size, so I think I'm living rather cheap ;)

I have debt-mostly a mortgage. My mortgage is significantly reduced as we paid it down with the proceeds from the sale of our last house.
So I owe far less than half of what the house is worth at a rate we got when mortgage rates were less than they are now..
We also have a very small credit card balance at a low rate that should be paid off in two or three months.
Then,the balance of medical bills-the portions not covered by insurance. No interest and I worked out monthly payments with the the doctor and hospital.

I dont see any of my debt as being bad, but many people I know pay a few hundred a month in interest on their credit cards.

This is a position I never want to be in.

I work for Barclaycard and am in fact posting from there now and my advice is that if you see a credit card then run, run like the wind preferably while covering your arse because the credit card company will definetly be trying to find a way to fuck you anyway.
true, true, true. i have held back from getting credit cards numerous times. i event went to HSBC asking for a visa DEBIT card (ie. one that wasn't maestro or switch or shit) and they tried to sign me up for a credit card very sneakily, having made myself very clear i did not want a credit card. it was only after i'd filled in all the paperwork and asked the person one last time did they say the words 'credit card', at which point i refused to sign and left the bank.

my mum just recieved a horrible call from Capitol One credit card people, which is what inspired this thread. apparently going £200 over your credit limit and then immediately paying it off along with your usual monthly bill as soon as you're informed is now "fraudulent" somehow. they have harrassed her for days now about it, to the point where she's in tears. it makes me sick, the vultures and hawks that these banks are. they suck the life and money out of honest, hardworking people in the endless pursuit of profit. they don't give two shits about the actual people they serve - they customers - just about the money they can suck out of them.

i'm really all for destroying the banking system in this country, seizing their assets, and setting up one nationalised government bank with the aim of serving the people rather than its own interests. god that would be good. turbulent for the economy, but it'd work out eventually.

I've been to university, and since I don't have rich parents, or any other similar source, I am £22k in debt. Thankfully, it's unsecured, so I'm really only paying back a bit each month, and I'm not in dire trouble if I become jobless.

at least the govt. loans aren't totally evil :)
i have between £3 to £5,000 in student loans myself. did quite well really compared to most

I do work for a few different creditors now-I see people in default with interest rates of 29% !!!

They get a credit card with a low rate,or 0% for six months or something else attractive like that.
Smart people,who already have their finances in perfect order take advantage of these rates and profit from them.

however,the average guy, struggling to pay bills,tries to use these offers to patch his problems. They never realize that if they "default" sometimes meaning payment is ONE DAY LATE, they go to a default rate that is extremely high. Then, you can expect to add a $35.00 per month LATE PAYMENT FEE and when you exceed your available balance from the higher interest and late fee, add a $35.00 per month OVER THE LIMIT FEE.

Thats odd? -increasing your limit for exceeding it. If going over your limit were really a problem,why not simply freeze the account til rectified?

Nope-there are plenty of struggling people to take advantage of.

true, true, true. i have held back from getting credit cards numerous times. i event went to HSBC asking for a visa DEBIT card (ie. one that wasn't maestro or switch or shit) and they tried to sign me up for a credit card very sneakily, having made myself very clear i did not want a credit card. it was only after i'd filled in all the paperwork and asked the person one last time did they say the words 'credit card', at which point i refused to sign and left the bank.

my mum just recieved a horrible call from Capitol One credit card people, which is what inspired this thread. apparently going £200 over your credit limit and then immediately paying it off along with your usual monthly bill as soon as you're informed is now "fraudulent" somehow. they have harrassed her for days now about it, to the point where she's in tears. it makes me sick, the vultures and hawks that these banks are. they suck the life and money out of honest, hardworking people in the endless pursuit of profit. they don't give two shits about the actual people they serve - they customers - just about the money they can suck out of them.

i'm really all for destroying the banking system in this country, seizing their assets, and setting up one nationalised government bank with the aim of serving the people rather than its own interests. god that would be good. turbulent for the economy, but it'd work out eventually.



at least the govt. loans aren't totally evil :)
i have between £3 to £5,000 in student loans myself. did quite well really compared to most


You're idea for handling the banks is totally insane, but I'll make this suggestion-
Get an American Express card and pay off your charged balance,interest free each month. They have real rewards for membership and they are accepted nearly everywhere.

it makes me sick, the vultures and hawks that these banks are. they suck the life and money out of honest, hardworking people in the endless pursuit of profit. they don't give two shits about the actual people they serve - they customers - just about the money they can suck out of them.
What do you expect? Their job is to screw every last penny they can out of you. Your job is to return the favour. That's how the system works...

at least the govt. loans aren't totally evil :)
i have between £3 to £5,000 in student loans myself. did quite well really compared to most
Yet.
Didn't good old Gordon Brown say he was selling the Student Loans Company in the budget?
My student loan is about £15k. At the moment it wouldn't make a difference if it's £1.50 or £1.5m; the interest rate on it is so low it's not worth paying back (my savings accounts earn more), and I don't earn enough to have any taken out of my wages. But if the rules are changed it might be... interesting.
Probably our glorious overlords going for Round Two of fucking over the students.

I do work for a few different creditors now-I see people in default with interest rates of 29% !!!

They get a credit card with a low rate,or 0% for six months or something else attractive like that.
Smart people,who already have their finances in perfect order take advantage of these rates and profit from them.

however,the average guy, struggling to pay bills,tries to use these offers to patch his problems. They never realize that if they "default" sometimes meaning payment is ONE DAY LATE, they go to a default rate that is extremely high. Then, you can expect to add a $35.00 per month LATE PAYMENT FEE and when you exceed your available balance from the higher interest and late fee, add a $35.00 per month OVER THE LIMIT FEE.

Thats odd? -increasing your limit for exceeding it. If going over your limit were really a problem,why not simply freeze the account til rectified?

Nope-there are plenty of struggling people to take advantage of.

It pays to read the agreement. This is simply a matter of playing the game - and they print the rules out for you.

I'm in the habit of keeping the card paid off each month. And I use the automatic checking account draft to do it. I'm never late, and I never have a running balance.

I also don't go over the limit. So I don't have any problems.

Just because they give you a card with a 5,000 limit doesn't mean you should run it up there. If you don't make 5,000 a month free and clear over your other basic obligations (rent, mortgage, utilities, etc) then you really shouldn't borrow that much unsecured.

It's a trap that many fall into - just because a person offers you a loan, it doesn't mean that the money really exists for you to spend it.

I do work for a few different creditors now-I see people in default with interest rates of 29% !!!

Default? Barclaycards standard interest rate for the Initial card is 27.9%

Standard for other Barclaycards is 19.9%.

Anti-Social Darwinism had a thread on this a few weeks ago:

http://forums.jolt.co.uk/showthread.php?t=519352

It has some pretty interesting things about esp. the US American system of credits and debts. I learned a lot- of course, mostly really things I'd rather not even have heard about, like this:
I do work for a few different creditors now-I see people in default with interest rates of 29% !!!

They get a credit card with a low rate,or 0% for six months or something else attractive like that.
Smart people,who already have their finances in perfect order take advantage of these rates and profit from them.

however,the average guy, struggling to pay bills,tries to use these offers to patch his problems. They never realize that if they "default" sometimes meaning payment is ONE DAY LATE, they go to a default rate that is extremely high. Then, you can expect to add a $35.00 per month LATE PAYMENT FEE and when you exceed your available balance from the higher interest and late fee, add a $35.00 per month OVER THE LIMIT FEE.

Thats odd? -increasing your limit for exceeding it. If going over your limit were really a problem,why not simply freeze the account til rectified?

Nope-there are plenty of struggling people to take advantage of.
Gah! That drives me crazy!

As does the fact that most people said that in the US, no credit history (i.e. always paid everything off on time, maybe not even had a credit card) equals bad credit history.

*gnashes teeth*

I do work for a few different creditors now-I see people in default with interest rates of 29% !!!

They get a credit card with a low rate,or 0% for six months or something else attractive like that.
Smart people,who already have their finances in perfect order take advantage of these rates and profit from them.

however,the average guy, struggling to pay bills,tries to use these offers to patch his problems. They never realize that if they "default" sometimes meaning payment is ONE DAY LATE, they go to a default rate that is extremely high. Then, you can expect to add a $35.00 per month LATE PAYMENT FEE and when you exceed your available balance from the higher interest and late fee, add a $35.00 per month OVER THE LIMIT FEE.

Thats odd? -increasing your limit for exceeding it. If going over your limit were really a problem,why not simply freeze the account til rectified?
yup, and if your card is with your bank they'll charge you anywhere upwards of £75 just to send you a letter saying "you're over balance"
so for being even just a couple of pounds over limit, and/or a day late on your payments, suddenly you're £150 even more in debt thanks to the people who are looking after your money. what a crock of shit.:headbang:
Nope-there are plenty of struggling people to take advantage of.
and therin lies the truth...
You're idea for handling the banks is totally insane, but I'll make this suggestion-
Get an American Express card and pay off your charged balance,interest free each month. They have real rewards for membership and they are accepted nearly everywhere.

no thanks, i'm sticking to debit and saving for things.

It pays to read the agreement. This is simply a matter of playing the game - and they print the rules out for you.

I'm in the habit of keeping the card paid off each month. And I use the automatic checking account draft to do it. I'm never late, and I never have a running balance.

I also don't go over the limit. So I don't have any problems.

Just because they give you a card with a 5,000 limit doesn't mean you should run it up there. If you don't make 5,000 a month free and clear over your other basic obligations (rent, mortgage, utilities, etc) then you really shouldn't borrow that much unsecured.

It's a trap that many fall into - just because a person offers you a loan, it doesn't mean that the money really exists for you to spend it.

People in that deep a hole dont read agreements-part of what gets them in that position to start with. They read the BOLD print that tells them what they are getting and want to believe its too good to be true. then can bitch and blame when they get slammed.

Its my opinion they should be teaching kids more of this in high school. Make them aware of how to avoid these traps,how to shop for the best loans and not carry interest. Encourage them to save and invest wisely,how to shop for a home or apartment-some more life skills,rather than half the crap they waste time on.

How many people are still paying interest on a meal they ate months ago and shit out the next day? Millions.

Default? Barclaycards standard interest rate for the Initial card is 27.9%

Standard for other Barclaycards is 19.9%.

Thats so high. The only people here that are paying that high interest are naive or dont have a choice.
It makes poor people poorer. It makes them take on more debt from other lenders.

yup, and if your card is with your bank they'll charge you anywhere upwards of £75 just to send you a letter saying "you're over balance"
so for being even just a couple of pounds over limit, and/or a day late on your payments, suddenly you're £150 even more in debt thanks to the people who are looking after your money. what a crock of shit.:headbang:

You can reclaim shifty bank charges, there's a big question about whether they're legal or not and the banks don't want them regulated, or something. Linky (http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1141050760,24632,)

People in that deep a hole dont read agreements-part of what gets them in that position to start with. They read the BOLD print that tells them what they are getting and want to believe its too good to be true. then can bitch and blame when they get slammed.

Its my opinion they should be teaching kids more of this in high school. Make them aware of how to avoid these traps,how to shop for the best loans and not carry interest. Encourage them to save and invest wisely,how to shop for a home or apartment-some more life skills,rather than half the crap they waste time on.

How many people are still paying interest on a meal they ate months ago and shit out the next day? Millions.

The way to avoid getting in a hole:

1. Do not live beyond your means.
2. Know how much you have for take home pay per month.
3. Now, figure out your basic living expenses - housing, food, transport, taxes, utilities, etc. - include a little to have fun with if you have that much.
4. Subtract the value in number 3 from the value in number 2. That's how much you can pay on debt - if that's what you want.
5. Pay with cash or a debit card where possible - or set up automated payments for things like utilities and housing.
6. Don't borrow unless it's necessary. Often, it is not.

Its my opinion they should be teaching kids more of this in high school. Make them aware of how to avoid these traps,how to shop for the best loans and not carry interest. Encourage them to save and invest wisely,how to shop for a home or apartment-some more life skills,rather than half the crap they waste time on.


i totally agree. you can't live in today's world without some knowledge of this stuff, of managing your finances, and at school we got absolutely zero introduction to any of it. you come out of school, you got to fend for yourself, manage your finances, all without knowing your arse from your elbow in financial terms... it sucks.

my mum just recieved a horrible call from Capitol One credit card people, which is what inspired this thread. apparently going £200 over your credit limit and then immediately paying it off along with your usual monthly bill as soon as you're informed is now "fraudulent" somehow. they have harrassed her for days now about it, to the point where she's in tears. it makes me sick, the vultures and hawks that these banks are. they suck the life and money out of honest, hardworking people in the endless pursuit of profit. they don't give two shits about the actual people they serve - they customers - just about the money they can suck out of them.


my husband deals with our credit cards. we have quite a few, mostly because he travels on business.

some cards are extremely tricksy. he calls every card every month to make sure of the balance, due date and address to send the payment to. obsessive for sure but we pay our bills online. these bastards do their best to screw you even when you always pay on time.

we have had all of the following

one company said we paid late, not because we paid late but because they "open the payments using our envelopes first and the ones with other envelopes later and we didnt get to yours until after hours"

one company--i think it was the no interest loan for a laptop--changed the mailing address for no descernable reason, just something they do from time to time

one company, probably the same as the first one, made a change in the due date because of thanksgiving when the due date wasnt ON thanksgiving weekend.

if you get caught in ONE of these semi-scams the rates on EVERY credit card is raised. grrrrrrrr.

Thats so high. The only people here that are paying that high interest are naive or dont have a choice.
It makes poor people poorer. It makes them take on more debt from other lenders.

The Initial is for people with a bad or no credit rating, even so it buggs me it's so high.

yup, and if your card is with your bank they'll charge you anywhere upwards of £75 just to send you a letter saying "you're over balance"
so for being even just a couple of pounds over limit, and/or a day late on your payments, suddenly you're £150 even more in debt thanks to the people who are looking after your money. what a crock of shit.:headbang:

and therin lies the truth...


no thanks, i'm sticking to debit and saving for things.

It does pay to have one account you manage wisely and show a history of paying timely.
Also- a large,unexpected expense could come up and its ok to have easy access to borrowing in a bind,then deal with appropriately when you can.

I think you still live at home, so I wont refer you to unexpected washer-machine breakdown or car breakdown-but you may need to travel unexpectedly and need to buy a plane ticket and rent a car,eat,hotel,etc... Some things dont wait for you to borrow and you may not have enough in saving to debit from.

So- treat a credit card for what it is- a convenient tool that needs to be managed very wisely.

It does pay to have one account you manage wisely and show a history of paying timely.
Also- a large,unexpected expense could come up and its ok to have easy access to borrowing in a bind,then deal with appropriately when you can.

I think you still live at home, so I wont refer you to unexpected washer-machine breakdown or car breakdown-but you may need to travel unexpectedly and need to buy a plane ticket and rent a car,eat,hotel,etc... Some things dont wait for you to borrow and you may not have enough in saving to debit from.

So- treat a credit card for what it is- a convenient tool that needs to be managed very wisely.

fair point. i'll get one if i have to, but i'd like to try not to... be hard but worth it to me :)

i totally agree. you can't live in today's world without some knowledge of this stuff, of managing your finances, and at school we got absolutely zero introduction to any of it. you come out of school, you got to fend for yourself, manage your finances, all without knowing your arse from your elbow in financial terms... it sucks.

This knowledge can be nearly as important as whatever you are studying to become.
Getting into a financial black hole can seriously put a kink in your school/career path.

In my opinion, its as important as almost any other subect they are teaching.

What do y'all think about debt? is it unavoidable in today's modern world? is consumer debt too high (it being about the highest its ever been in most western countries)? can you live your life without getting in debt? is debt all that bad or can you live with it no problems? how do you think debt affects different portions of society and the economic spectrum?
The question should be more along the lines of how to avoid bad debt. The good debts are kind of like buying stock on margin -- If you buy a house, it builds equity. It's an investment and the debt is good debt. If you buy a car, it just decreases in value. Better to buy that three or four year old car, just off of a lease, and pay cash for it. The worst debt that you can have is debt to pay off other debt. Think of all those ads to refinance your home, just to pay off your credit cards. That's bad debt at its worst.

The way to avoid getting in a hole:

1. Do not live beyond your means.
2. Know how much you have for take home pay per month.
3. Now, figure out your basic living expenses - housing, food, transport, taxes, utilities, etc. - include a little to have fun with if you have that much.
4. Subtract the value in number 3 from the value in number 2. That's how much you can pay on debt - if that's what you want.
5. Pay with cash or a debit card where possible - or set up automated payments for things like utilities and housing.
6. Don't borrow unless it's necessary. Often, it is not.

All good,valid points. All should be driven home in students,starting in 10th grade.

Add to it- Paying yourself as a bill-At least 10% of your gross income.

Also-bank what you save. Make it an automatic function. If you use a coupon or get a special deal where you save $ X.XX, deposit what you saved into your interest bearing account.

Just making a few simple things second nature can be painless and provide for you well in the future.

i have a foolproof scheme for avoiding debt in my life. i'm going to win the lottery. reckon i'll do it next week.

i have a foolproof scheme for avoiding debt in my life. i'm going to win the lottery. reckon i'll do it next week.
I'm sure that you are just tongue-in-cheek, but it's scary how many people think they can fund their retirement with lottery winnings.

my husband deals with our credit cards. we have quite a few, mostly because he travels on business.

some cards are extremely tricksy. he calls every card every month to make sure of the balance, due date and address to send the payment to. obsessive for sure but we pay our bills online. these bastards do their best to screw you even when you always pay on time.

we have had all of the following

one company said we paid late, not because we paid late but because they "open the payments using our envelopes first and the ones with other envelopes later and we didnt get to yours until after hours"

one company--i think it was the no interest loan for a laptop--changed the mailing address for no descernable reason, just something they do from time to time

one company, probably the same as the first one, made a change in the due date because of thanksgiving when the due date wasnt ON thanksgiving weekend.

if you get caught in ONE of these semi-scams the rates on EVERY credit card is raised. grrrrrrrr.

absolutely - its sickening. as soon as you go belly up on one card your credit rating plummets and all of a sudden you probably owe on all your cards. a while back we defaulted on a payment by a day or two and all of a sudden we found not only had our interest gone up on a couple of cards, but also other payments going through on other cards were blocked... meaning we got letters from banks saying payments and cheques bounced, things we needed and had (we thought) paid for were cancelled, and over one weekend (when the banks were closed and we couldn't do anything about it) we ended up oweing over £750 to the banks just because one of them was uppity over a payment. its basically a fucking bribe - pay us loads of money, say the banks, or we'll destroy your life. wankers.


then there's the finance company of a store card we use for the business who seemingly forget to put our cheques through. we need to buy these things for the business, we go to the store, wait in line having sent off cheques to pay the balance (and not having had it bounce; with enough money to pay), and find our purchases declined. reason? the finance company were sitting on our cheque for some unknown reason. and this has happened so many times i can't remember. they just fuck around with your life, and your pride, and never offer a word of apology when they fuck up. but when its you they're all over you to fuck you over.

i seriously fucking hate it. its one of the main reasons i can't think about the future. i take life day by day or i get so depressed and despondent i just want to give up before this all gets to me, like there's no point trying in life because if somebody else doesn't fuck you over, the banks will, and quite legally too. i haven't taken my meds in a week or so, so its probably partly that, but that's how i'm feeling at the mo. fucking banks.

I'm sure that you are just tongue-in-cheek, but it's scary how many people think they can fund their retirement with lottery winnings.

There are higher odds of being struck by lightning several times, or being hit by a meteorite, than winning the lottery.

Perhaps our education system doesn't include instruction on basic probability.

The question should be more along the lines of how to avoid bad debt. The good debts are kind of like buying stock on margin -- If you buy a house, it builds equity. It's an investment and the debt is good debt. If you buy a car, it just decreases in value. Better to buy that three or four year old car, just off of a lease, and pay cash for it. The worst debt that you can have is debt to pay off other debt. Think of all those ads to refinance your home, just to pay off your credit cards. That's bad debt at its worst.

And paying interest on interest has to be avoided too.

Buying a new car can be good-This should be a part of a course as well. Some people arent mechanical at all and need a new car with less potential for breakdown and a good new car warantee if it does.

BUT- too many people are buying cars with little or no money down. They are taking out 5 and even 6 YEAR loans to lower their monthly payments. (They should be putting more money down to lower their payment, or getting a cheaper car)
Then,they have a problem many dont know about until its too late- Negative Equity.

Mr.Smith owes $20,000.00 on a car thats only worth $10,000.00. He cant afford the $479.00 per month payment because his overtime he was relying on to pay bills has been cut,so he falls three months behind and the bank repossesses the car.
The car is in dirty,has some dings & scratches, needs new tires, a tune up etc...All the stuff people in over their heads put off doing because they dont have the money.
So-the bank sells the vehicle at auction. To an employee's brother-in-law,who has a used car lot. He buys the car for $6,000.00

Now-Mr.Smith doesnt have the car anymore, but still owes the bank $14,000.00. And-the bank doesnt want $479.00 a month anymore-they want it all immediately,as if Mr.Smith can write a check.
He cant,so they sue him and get a judgement against him. He doesnt own property,so they send legal restriction notice to his bank,freezing his accounts. He only has $220.00 in the bank and when the bank restricts the account, THE BANK imposes a $100.00 fee for this, so his balance is now $120.00,which doesnt matter now,because its frozen.
And all the checks he wrote this week bounce before he knows about the restriction. (The bank has a $20.00 bounced check fee *per bouce* and all the people Mr.Smith wrote checks to will submit them a second time-as a courtesy).
Mr.Smith is very upset now. Especially when he goes to work tommorrow and his boss calls him in to let him know the marshal contacted them and will be taking 25% of his gross pay out of his check each pay period.


Read this a few times and let it sink in if you can stand it. I didnt make it up-Its based on scenarious that happen hundreds of times a day in the US.

Consider adding to the mix that Mr.Smith may also be unemployed on top of everything. He may owe child support. He almost always has several other creditors. If he isnt late on rent or mortgage, he will be soon.

It was little mistakes adding up that got him here. All of these errors should be taught to students before they are exposed to it.

I'm sure that you are just tongue-in-cheek, but it's scary how many people think they can fund their retirement with lottery winnings.

i'm only half joking. basically i'll do anything short of prostitution to get money at the moment. so far i've won £12 on the lottery which has paid for all the lottery ticks i've ever bought and £2 to spare. that's a day's travel costs, so not too shabby.

There are higher odds of being struck by lightning several times, or being hit by a meteorite, than winning the lottery.

Perhaps our education system doesn't include instruction on basic probability.

I doubt that she coined the phrase, but the first time I heard "The lottery is just a tax on people that can't do math", was when our move back to Georgia coincided with the introduction of the Hope Scholarship/State Lottery.

i have a foolproof scheme for avoiding debt in my life. i'm going to win the lottery. reckon i'll do it next week.

My wife taped a show last week with Lottery Winner horror stories.

Problems people never should have.

There should also be a course on how to manage windfall profits. Not just lottery winnings, but how about tax refunds,etc...?

Most people piss them away immediately and waste the happiness and security that some cash in the bank can bring.

Most people piss them away immediately and waste the happiness and security that some cash in the bank can bring.
you know, that's all i've ever wanted with money. never wanted to be rich, only ever wanted enough money to not have to worry about money.

Here's my pitch for on-line financial advice. The Motley Fool (http://www.fool.com/index.htm) is one of the best resources around for advice. Once upon a time, most things were freely accessible, but now they've started to charge some user fees. Still, there is a ton of good advice all in one spot.

One of my favorite message boards (http://boards.fool.com/Messages.asp?bid=100158) is "Living Below Your Means".

The high level of debt and the low level of savings are warning signs that many people have become extremely present-oriented. This essentially means that people are sacrificing their future to enjoy themselves now. Obviously, this cannot be sustained, and is a symptom of a coming economic collapse.

you know, that's all i've ever wanted with money. never wanted to be rich, only ever wanted enough money to not have to worry about money.

I'm the same way. I just want a little security so I can live life and enjoy life with my family.
We arent very materialistic.

Of course,I'd love to win a lottery. I buy a ticket,on occaision. Its worth the dollar you spend to dream about it for a few minutes.

I am currently 17 dollars in debt. It will be taken care of with the next credit card bill. Only reason I have a credit card, though, is to gain a credit rating, so I don't have to get my parents to co-sign for every single apartment I ever rent. That would suck.

Buying a new car can be good-This should be a part of a course as well. Some people arent mechanical at all and need a new car with less potential for breakdown and a good new car warantee if it does.

I learned to buy cars used a long time ago.

No sense in buying something new that plummets in value the moment it leaves the dealer's lot.

If you buy a car that's a couple of years old, and has been reasonably maintained, and is still in good shape (have a mechanic check it if you have no talent for cars), it's a better deal than a new car.

I learned to buy cars used a long time ago.

No sense in buying something new that plummets in value the moment it leaves the dealer's lot.

If you buy a car that's a couple of years old, and has been reasonably maintained, and is still in good shape (have a mechanic check it if you have no talent for cars), it's a better deal than a new car.
That's why I recommend buying cars that are returns from leasing. (another bad move, typically) They are about 2-3 years old, only have a minimum of mileage, and the owner usually treats them very well. Much better than the 1 year old, 40,000 mile beasts that the rental companies sell.

In fact, on a 2-3 year old car, there's typically some factory warranty left.

Here's my pitch for on-line financial advice. The Motley Fool (http://www.fool.com/index.htm) is one of the best resources around for advice. Once upon a time, most things were freely accessible, but now they've started to charge some user fees. Still, there is a ton of good advice all in one spot.

One of my favorite message boards (http://boards.fool.com/Messages.asp?bid=100158) is "Living Below Your Means".

And for the UKnians amongst us there is www.moneysavingexpert.com, the website of Martin Lewis, who's BBC Radio 2's resident cynic/money expert.
His first book's good, too; I bought it for some friends of mine (they are embarassingly hopeless with money. It's just maths!), but read it myself, partly to check it was OK and partly because I'm a cheap bastard; why buy two copies? ;)

I learned to buy cars used a long time ago.

No sense in buying something new that plummets in value the moment it leaves the dealer's lot.

If you buy a car that's a couple of years old, and has been reasonably maintained, and is still in good shape (have a mechanic check it if you have no talent for cars), it's a better deal than a new car.

Same here. After working on all ends of the car market-from sales to lending to recovery, I seat when I think of walking into a dealership to buy a new car.

I've considered writing a book on how to buy a car and get financed.

Now-another thing I do- I havent had a car payment in 5 years,but I still try to pay myself a $250.00 per month car payment. Most months we do, some we cant.
If we do go to buy a car, I can designate the "car payment" money I saved as a down payment. And I already know I can at least handle the $250.00 per month payment.

I am currently holding out now until Ford or GM offer 0% financing PLUS a rebate. They have each year for a few years now.
As soon as they do so again,I will be in a position to take full advantage of it.

That's why I recommend buying cars that are returns from leasing. (another bad move, typically) They are about 2-3 years old, only have a minimum of mileage, and the owner usually treats them very well. Much better than the 1 year old, 40,000 mile beasts that the rental companies sell.

In fact, on a 2-3 year old car, there's typically some factory warranty left.

NEVER EVER buy a car that used to be a rental. If you've ever driven a rental, you can imagine why you shouldnt own one.

Also- NEVER EVER drive a car described as a "Demo" "Executive Demo" demonstrator,etc.. These are cars that were driven be people that merley put gas in them and likely no other care or maintenance.
There could likely be damage or repairs not obvious and will not show up on any CARFAX report.

I'm on the fence over lease cars. It would stand to reason many could be well maintained as a lease incentive often includes regular maintenance and the better shape you turn it in under,the less you have to pay.

If you arent mechanical,have a mechanic look them over before buying. Its $75.00 to $150.00 well spent.

I don't like being in debt or using my credit. I paid for college out of my pocket, not by choice, I apparently made too much to qualify to take out student loans (working 40 hrs a week at minimum wage is apparently $$ enought:mad:).

I also haven't gotten to the point in my life that I want to buy a house. I have a few flub-ups from my younger years. I'm waiting for those to drop off (two should be gone next year).


It makes some things harder. I usually need a second or third job to make a major purchase. I do like owning something free and clear though.

bump

I find debt isn't necessarily a bad thing, but it is something I conciously try to avoid. I'm currently close to my overdraft limit, but there's more than enough in my savings account to cover this debt. My way of seeing it is that if the bank is willing to pay me ~£3 a month to borrow their money then so much the better. I also have a credit card, but that's only for online purchases due to comprehensive fraud protection. The most I've ever had on it was £30 and it gets paid back every month in full.

I would like to be completely out of debt, unfortunately, I owe Uncle Sam money (at least that's what Uncle Sam says). Otherwise, I own my home, my car and all my furniture (including electronics) free and clear. It's a good feeling. I wouldn't care to have high interest credit debt again - I plan on avoiding it at all possible costs.

Debt is part of what makes the economy tick, but if I were to have my druthers, I would stop the current trend for lenders to give a credit card to anything that moves and their pet rock. It's not so much giving credit, it's the amount of credit that companies will allow. Credit = Debt, plain and simple. Most people, even those with good credit ratings, tend to let the cost of borrowing interfere with their lifestyles.

The way I see it, debt is okay if you can back it up, or have a conceivable plan to dig your way out of it if all fails.

Incidentally, I am currently bankrupt, and have had a thorough education on debt. It's a blast.