Are you in debt?

[ROBOTRON]

Do I win a prize for being the most fucked up?

Nope. A winner is me.

EDIT: I can't believe my eyes, many of you have never had debt in your life???? Simply amazing. I'm in my 40's Have a 20 year old kid, bought houses, several cars, motorcycles, boats and sh*t loads of expensive electronic gizmos and so forth and have had debt to be paid off many times....I'd never been able to accomplish any of life's pleasures without some kind of debt incurred. Assuming some of you are around my age, how in the f*ck did you do it? You cash paid for your home, cars, etc. all your life?

[DEL]

^In a word Mr ROBOTRON - decent parents and applying the 'buy only what you can currently afford' principle.
EDIT:- Alright....several words

[Randorama]

I am in a good credit situation and hopefully switching to a stabler work situation. My trick is to live a modest lifestyle, with a few tricks.

I live in Sydney CBD (incredible sight!) with my partner, and we share an apartment with another couple, so we end up paying a low rent: 170 AUD, including bills, internet, rice (!) and internal gym and pool (serviced apartment). We buy food in a smart way: with 30 AUD per week, we buy beer too. I have manteinance costs (i.e. dresses, train tickets, cheap dinners out), and save all the rest.

I think that anyone with some decent wits can enjoy a good, debt-free life. I was lucky enough to pay little for my studies (and get paid for my Ph.D.), so I didn't have to face a serious problem early on in my life. However, as someone who has lived abroad for a while, I learnt the hard way that every penny counts. I had moments of madness (a chinese girlfriend too), but I could handle those in a decent way. I do use credit cards, but to get money from ATMs.

The most ironic thing is that I *might* land a very good job next year, so I wonder how would I end up using a salary which could, in a sense, be too much for my lifestyle.

[brentsg]

EDIT: I can't believe my eyes, many of you have never had debt in your life???? Simply amazing. I'm in my 40's Have a 20 year old kid, bought houses, several cars, motorcycles, boats and sh*t loads of expensive electronic gizmos and so forth and have had debt to be paid off many times....I'd never been able to accomplish any of life's pleasures without some kind of debt incurred. Assuming some of you are around my age, how in the f*ck did you do it? You cash paid for your home, cars, etc. all your life?

In that sense it's an interesting but pointless discussion. We've got people from every stage of life here.

For someone that's 40 to say they've never had any debt is one thing. To have someone that still lives with mom and dad, or is just out of school and living in an apartment.. that's quite another. I guess anyone with an apartment rental situation could avoid debt for the most part. Plus someone that's 30+ should have assets that exceed any debts anyways, mortgage included.

I think my last car loan was at 1.25% interest. That's like borrowing money for free. Home loans can now be had for 3.75% or better with no points in the US.. and the interest is tax deductible. There's nothing evil about debts like that.

[DEL]

ehi Rando,

Nice to see you're doing well in OZ

ROBOTRON wrote;

I'm in my 40's Have a 20 year old kid, bought houses, several cars, motorcycles, boats and sh*t loads of expensive electronic gizmos and so forth and have had debt to be paid off many times....I'd never been able to accomplish any of life's pleasures without some kind of debt incurred

Yeah but the point is....you've HAD all those things, which is great.

brentsg wrote;

Plus someone that's 30+ should have assets that exceed any debts anyways, mortgage included.

True its an age thing. By 40 you should have sorted some things out, financially.

[Ex-Cyber]

I think I'm reasonably responsible for my circumstances (which are pretty fortunate; I'm currently attending college basically for free), but I also don't really think that counts for as much as people like to think it does, at least here in the US. As much as some people like to harp on personal responsibility, a lot of the equation is still down to being lucky, particularly when it comes to health. As paradoxical as it sounds, a lot of people cannot afford to be fiscally responsible. It seems like we've somehow "successfully" decoupled economic reality from practical reality.

[cul]

Around 20 000chf of medical debt because we couldn't really pay for healthcare when we arrived in schweiz and well yadda yadda. Basically this is just money I own to the state who paid the bill for me, and I'll have to pay when I can, no interest on it. So virtually I'm debt free, no credit cards, no loans (not eligible for one anyway), don't owe any money to any bank or anyone.

[cul]

I think I'm reasonably responsible for my circumstances (which are pretty fortunate; I'm currently attending college basically for free), but I also don't really think that counts for as much as people like to think it does, at least here in the US. As much as some people like to harp on personal responsibility, a lot of the equation is still down to being lucky, particularly when it comes to health. As paradoxical as it sounds, a lot of people cannot afford to be fiscally responsible. It seems like we've somehow "successfully" decoupled economic reality from practical reality.

I agree a lot on this.

But there's also many case of people with nearly no income, who get stupid 10% and higher rates loans to buy fucking LCD tv sets when they're poor as fuck. I know countless of people like that. We're very modest and counting every penny in my family, but we have the COMMON SENSE to not try to live above our condition.

[Skykid]

PM'ing Icarus.

[Davey]

But there's also many case of people with nearly no income, who get stupid 10% and higher rates loans to buy fucking LCD tv sets when they're poor as fuck. I know countless of people like that. We're very modest and counting every penny in my family, but we have the COMMON SENSE to not try to live above our condition.

Not that that kind of spending is excusable, but I've heard the logic behind it. If you're really far in debt and it'd take you a lifetime to dig yourself out, you lose all motivation to pay it down. Given the choice between:
1.) $50,000 of debt and keeping your old TV, and
2.) $51,000 of debt with a new HDTV

A lot of people will take choice #2, since $50k doesn't seem any less insurmountable than $51k, and at least the TV gives them something to look at and/or brag about. On that note, I remember driving through some ghetto neighborhoods where lots of people had satellite dishes (although if everybody else's house looks like a dump, there isn't much incentive to give yours a new paint job or fix the front porch or whatever).

[professor ganson]

I'm with Skykid. The only debt I carry is a mortgage loan. I did have student loans back in the day, but not for very much and that was a good investment, it turns out.

[Khan]

Skykid just out of curiosity are you Chinese??

Nope!

The revelations don't stop coming here. As there are two very interesting topics clashing here, I've requested a thread split - one for debt, and another where people can get stuff off of their chest. Talking about difficult things is good therapy.

Khan, I'm assuming that you're from a muslim background or something similar from the things you mentioned (forgive me if I'm wrong). Are there arranged marriages and such still part of your family, or did you decide you weren't interested in all that?

You would be spot on there my good man although im more of a moderate Muslim who prefers things the way they are.

Arranged marriage per se is old news now, when people usually mention arranged marriage to an asian it means boy x goes to club meets girl y spends sometime chillin with her months go by things are going good both visit each others parents then leave the rest up to the seniors to sort out pay for the dowry ect. thats an arranged marriage in todays terms however although its rare you still get the other type of arranged marriage where both bride and groom meet once then get hitched on the spot but like I said that is VERY rare infact I can only think of 1 of my friends who was put in that situation and to be fair hes doing well as he's got 3 kids with her and loves her to bits personally speaking I couldnt do it that way it....scares the shit out of me

I myself am looking but just not trying hard enough, but I've been crap at relationships a bit too trusting and when it comes to women im the type who would probably play fetch everytime she throws the bone I blame it all down to lack of ahem* sex

when the time comes I'm gonna go out and look but for the moment I guess in reality im happy having freedom and no responsibility although they say the older one gets the harder it is to have children so I dont want to leave it too late lol

[Dave_K.]

I must have been lucky attending college in the late 80's while it was still cheap. I went to a no-name school in upstate NY, no student loans, worked every summer to pay for tuition, no debt upon graduation. My continued work ethic helped me land a corporate job straight out of school. Thankfully there were no expensive gizmo's other than a PC during that time, which my work provided for me. They even paid for all my moving expenses to CA. Never even owned a cell phone until 2002. Never owned a new car, always used, and always cash in hand. The only debt I currently have is a mortgage, which I could probably pay off completely, but I'm still saving to start a family, and probably move into a bigger place.

[brentsg]

when the time comes I'm gonna go out and look but for the moment I guess in reality im happy having freedom and no responsibility although they say the older one gets the harder it is to have children so I dont want to leave it too late lol

Hurry, find someone before you run out of punctuation! Oh hell, too late..

[ROBOTRON]

ehi Rando,

Nice to see you're doing well in OZ

ROBOTRON wrote;

I'm in my 40's Have a 20 year old kid, bought houses, several cars, motorcycles, boats and sh*t loads of expensive electronic gizmos and so forth and have had debt to be paid off many times....I'd never been able to accomplish any of life's pleasures without some kind of debt incurred

Yeah but the point is....you've HAD all those things, which is great.

brentsg wrote;

Plus someone that's 30+ should have assets that exceed any debts anyways, mortgage included.

True its an age thing. By 40 you should have sorted some things out, financially.

Easy to say, not easy to do.

Some of life's bumps hit you instead of you hitting them. Say, illness, accidents, planned or unplanned parenthood, etc. Boats, planes, cars, motorcycles, vacations/holidays, etc. probably should be avoided if you can't pay cash for them....but not all of us have great parents or hit the lottery at age 18. I still don't see how its possible, but congratulations to those of you who have accomplished this feat...I mean really serious. If I had a time machine, I'd go back and erase my debts and correct my mistakes but unforeseen occurrences would still trip me up I'd bet.

[Skykid]

Easy to say, not easy to do.

Some of life's bumps hit you instead of you hitting them. Say, illness, accidents, planned or unplanned parenthood, etc. Boats, planes, cars, motorcycles, vacations/holidays, etc. probably should be avoided if you can't pay cash for them....but not all of us have great parents or hit the lottery at age 18. I still don't see how its possible, but congratulations to those of you who have accomplished this feat...I mean really serious. If I had a time machine, I'd go back and erase my debts and correct my mistakes but unforeseen occurrences would still trip me up I'd bet.

It might be a total falsehood so correct me if I'm wrong, but the general impression of people in the UK (not sure about other places) is that US citizens rely heavily on credit, in that it's quite normal, acceptable, and fairly easy for people there to get nice cars, houses etc on loans - but then live paying off the interest practically forever.
Obviously we know about sub-prime mortgage lending, but that's just an extreme of an already existing problem.

The UK is a little more stringent when it comes to borrowing. Credit ratings are serious here - if you run up a bad debt once, it can fuck your credit rating for years, essentially limiting to you to dealing with that bad debt without having an opportunity to get another (and you won't get a mortgage either.)
Regardless, the credit industry in the UK is just as evil as anywhere - you never stop seeing ads for people trying lend money and essentially shackle you with debt for all eternity.

What amazes me is why anyone would take somebody else's cash to get something they want, rather than something they absolutely need. I don't come from wealthy parents. They're middle class, but by no-means well off, and I really had to dig in to get to a position where I can buy nice things - but always being careful to make sure I could afford it first.

Touch wood, that ethos must have done some good, and apart from a Muchi Muchi pork PCB, there's nothing I absolutely need.

Anyway, capitalism is slavery and debt is the methodology. If everyone took heed of that I reckon we'd all be better off.

[brentsg]

Easy to say, not easy to do.

Some of life's bumps hit you instead of you hitting them. Say, illness, accidents, planned or unplanned parenthood, etc. Boats, planes, cars, motorcycles, vacations/holidays, etc. probably should be avoided if you can't pay cash for them....but not all of us have great parents or hit the lottery at age 18. I still don't see how its possible, but congratulations to those of you who have accomplished this feat...I mean really serious. If I had a time machine, I'd go back and erase my debts and correct my mistakes but unforeseen occurrences would still trip me up I'd bet.

Parenthood young would really be a difficult one, even planned. I had kids very late, which is great in a financial sense. I had everything sorted way before any kids came along. It was also nice that my wife and I are both established professionally. I changed jobs right after having kids, after having been in the same job for 10 years. Unfortunately the boss at the new place wasn't kid-friendly. Like, when I interviewed he expressed concern about hiring me due to my kids. In hindsight I should have done the FUCK YOU, you don't wanna hire me b/c I have kids??? But instead I struggled with it and am no longer there. Stupid too, OMG I had to leave on the rare occasion at 5:45PM to pick them up at daycare if the wife couldn't.. or stay home with a sick kid a couple times per year.. again when the wife couldn't. (oops going OT)

But yeah, I am not sure how things would have worked out with kids at a young age. It certainly would have been quite different from both a financial and family perspective. I'll be ancient when they finally move out.

[brentsg]

It might be a total falsehood so correct me if I'm wrong, but the general impression of people in the UK (not sure about other places) is that US citizens rely heavily on credit, in that it's quite normal, acceptable, and fairly easy for people there to get nice cars, houses etc on loans - but then live paying off the interest practically forever.
Obviously we know about sub-prime mortgage lending, but that's just an extreme of an already existing problem.

The UK is a little more stringent when it comes to borrowing. Credit ratings are serious here - if you run up a bad debt once, it can fuck your credit rating for years, essentially limiting to you to dealing with that bad debt without having an opportunity to get another (and you won't get a mortgage either.)
Regardless, the credit industry in the UK is just as evil as anywhere - you never stop seeing ads for people trying lend money and essentially shackle you with debt for all eternity.

There might be some truth to it, but it's probably more of a generalization than anything. Credit ratings are serious business here too, it's just that we went through a period of time where lenders didn't really seem to care. Ehh yeah you've got a bad rating, here take a loan anyways. A lot of that generated our problems. I mean, people had bad ratings for a reason, so sure.. they're gonna be irresponsible even more if you let them.

Perhaps it is something that hits some financial segments more than others. I personally don't know anyone who had their home foreclosed. But if you watch the news it's apparently pretty common. I think jobs drove some of this too. There are some areas of the country, that if you want to live there you have to pay a stupid price for a home. Even then you might have a 1 hour commute. Take a job like this, and make the investment to live there but it's risky. When the economy turned these people were all well fucked. There were even some communities that had serious shortages of workers to do things like law enforcement, firemen, teachers, and common necessary things like grocery workers and such. They simply could not afford to live in some areas.

[Skykid]

There might be some truth to it, but it's probably more of a generalization than anything.

I figured that. I mean, it wouldn't be completely alone anyway - the UK might not be sinking in debt, but it's definitely getting there. More and more kids are given credit cards, loans and offered student overdrafts etc etc. And a lot just want to live a TV lifestyle - I'll never forget a girl at work called Kia who was so nice, but I used to feel so sorry for because she'd cry all the time. When I finally got her to tell me what was wrong (she was pretty shy), she basically said she'd moved out of London to try to escape credit card debt (as they were knocking on her parents door) but it was impossible. I think she owed 12k because she went nuts and maxed out 3 credit cards when she was 16, and she was 18 at the time.

When I have kids, I'm just going to try to get them to realise one thing: A loan is not a loan, a loan is a debt. 'Loan' is a nice word, a word that encourages you to take it from the smiling bank clerk, but the truth is he's handing you a debt - the loan doesn't exist because he doesn't care what you do with the money, only the amount of interest he'll make back.

No such thing as a bank loan, only a debt.

[KBZ]

capitalism is slavery and debt is the methodology. If everyone took heed of that I reckon we'd all be better off.

In the US and Canada, the worst parts of capitalism and corporatism are mostly not felt as debt is the equalizer for most of us. There isn't much of an "Us and Them" (rich vs poor) mentality like you might have found during the Great Depression and afterwards.

One example might be that everyone drinks at Starbucks but few can afford to. Many years back, poor folk simply didn't have the cash. Nowadays they can enjoy all the the perks of being rich by going into debt. Same with SUVs, iphones, HDTV, you name it.

I think we all have a sense that things have gotten out of hand, but who's going to step up to the podium and start a movement to save us from spending our lives away? More importantly, who will let them onto the podium to begins with! Big business wouldn't be very happy with someone telling everyone to be conservative with their measly earnings.



As for myself, yes I'm in Debt like most people. Coming from a lower class family with aspirations of a University degree, it's relatively easy... plus I like drinking mocha.... >_<. I've moved to Québec where tuition is much cheaper than back in ON or BC (2,000/year vs 5,000/year), but finding a decent job to pay rent and living expenses is tough when your french isn't up to par. It's very easy to go deeper into debt with my student loans once I'm already in debt. On the one hand I want to save, but I also want my hobbies to flourish which means buying games and parts for different electronics projects. So more often than not, I'll throw caution to the wind and put something on a credit card and pay it off with loans.

I know it isn't smart, but the devil on my shoulder always says "what's a couple hundred bucks?" or "this is a time to be in debt, you're young and you'll land a good job later right?"

This thread has inspired me to cancel a bunch of planned purchases though. Truly the best way out of debt is to save...... I need a beer

[GaijinPunch]

Assuming some of you are around my age, how in the f*ck did you do it? You cash paid for your home, cars, etc. all your life?

I'm 35. I have a 3 year old kid. I've owned a new car (once) and paid cash for it. Never owned a home, or a boat. Owned lots of $1000-$2000 PCBs over the years. That's about it.

[Davey]

I know it isn't smart, but the devil on my shoulder always says "what's a couple hundred bucks?" or "this is a time to be in debt, you're young and you'll land a good job later right?"

Later = allowing time for interest to compound = [insert GP financial rape analogy here]

Of course, the severity depends on the length of time and the interest rate.

[Davey]

Oops, forgot to comment on this one:

Home loans can now be had for 3.75% or better with no points in the US.. and the interest is tax deductible. There's nothing evil about debts like that.

Mortgage debt isn't a bad thing, I agree. But in my experience, some people gloss over other costs in buying a house vs. renting an apartment. On top of the mortgage itself (which is largely interest, which you'll never get back), you have property taxes, maintenance, homeowner's insurance, utilities that are normally included in rent (e.g., water), higher utility bills for heating/cooling a larger space... it really changes the math. Of course, it's not a fair comparison since houses have other advantages (more space, private yard, etc.), but I used to get annoyed when people said renting is "just throwing your money away."

Despite all this, I bought a place earlier this year. Low prices + low mortgage rates + $8k tax credit + finally have a stable job I don't hate = time to bite the bullet.

[Magic Knight]

Only time I was in debt was when I bought too many games, the most was indebted I was, was about £3,500, and that was about six years ago. I never had a student loan or fees to pay (university is free in Ireland, you still have to pay for rent, books etc. of course). But we were extremely frugal then (late 90's). We neither had landline nor mobile phones, often no television, lived on cheap canteen food, we'd go to nightclubs at 8 in order to get in free, then just drink diluted blackcurrant for the night, which you might get free if you were lucky. No taxi nonsense, we'd walk everywhere. £20 a week rent. Happy, happy days. We used to play MAME on my old 486... the memories.

Now I don't have a credit card, pay for everything in cash, I still buy too many games, but then I just sell off a few to bump up the bank account and start again. My Japanese wife is very conscientious about money, and has no time for fancy expensive accessories like bags etc.

Trying to save this year now, I'm putting away 150,000 yen a month, and hope I can raise that to about 200,000 a month.

[rancor]

My Japanese wife is very conscientious about money, and has no time for fancy expensive accessories like bags etc.

How did you mangage this?!? Mine at least has the consideration to buy fake shit from Korea. It has to be the AAA fake stuff, but note the less, her twice-yearly trips do put a ding in our finances. I suppose she makes up for it though by making dinner 5 nights a week.. Going out every night is expensive!!

[Magic Knight]

My Japanese wife is very conscientious about money, and has no time for fancy expensive accessories like bags etc.

How did you mangage this?!? Mine at least has the consideration to buy fake shit from Korea. It has to be the AAA fake stuff, but note the less, her twice-yearly trips do put a ding in our finances. I suppose she makes up for it though by making dinner 5 nights a week.. Going out every night is expensive!!

My wife spent about 6 years sharing a room with other women, where each only had one tatami's space to themselves, and she earned only FIVE THOUSAND YEN a month (board and lodgings were included in the job). We're just finishing up moving her stuff from her old apartment, because it's about to be demolished. Which isn't surprising, since it's not fit for human habitation.

We were married over a year before I even bought a wedding ring, and that was in a 20% off sale.

[evil_ash_xero]

I owe my family about fourteen thousand. I'm not in debt with anyone else, and i'm getting that paid back moderately quickly. I'd be doing better, but I had some problems with a couple of crowns, and that cost big $$.

[Skykid]

One example might be that everyone drinks at Starbucks but few can afford to. Many years back, poor folk simply didn't have the cash. Nowadays they can enjoy all the the perks of being rich by going into debt. Same with SUVs, iphones, HDTV, you name it.

This is kind of the credit mentality I mentioned before that brentsg answered. That picture is similar to how we understand the poorer classes in the US to be (relying on a lot of credit). It's grapevine stuff though, y'know. I've got a lot of family over there and when I visit my uncle's are usually debating some hot topic.

Anyway, what's a coffee in a US Starbucks then? I usually drink in Costa Coffee (prefer the atmosphere... and the coffee) and it's £1.80 for a small Americano. That's usually all I go for.

[brentsg]

A bit off topic, but I hate what the sports teams do. In the NFL in particular, if home games aren't sold out they will black them out on TV locally.

With a lot of people being so passionate about their teams, I bet that really sucks for the lower and lower middle classes. I guarantee that game day at a stadium hits the ole credit card pretty hard.

At least for me, you bust your ass all week. Then Saturday is a good day for family outings and getting household chores done. Sunday, aside from church stuff (for some) is all about rest and football. It's a ritual that gets looked forward to all offseason, then all work week.

[Mero]

No 'proper' debts, got a credit card I haven't used for 10 years and my bank account is in the black. The only thing I owe is my student loan debt, payments for which(about 15-20 quid) are deducted from my wages each month. The only thing that very slightly concerns me is that our new "super austere" government might decide to sell off the student loan book at some point - I could have a private company chasing my arse for the money, which isn't very desirable.