CC minimum payment increase...HOLY COW!

[Planogirl]

I understand that people have really bad things happen and do not have the money necessary to cover expeneses.

But with that said, is anybody really better off in the long run because credit cards were an option? Everything I've read about the typical situations basically comes down to credit cards making it worse, prolonging the problem long after the crisis is over.

It depends on the situation.

We managed to dig out of a prior situation with the help of credit but that's only because we were able to increase our income to get us over the hump.

We're in a mess now to be honest and I'm not sure if credit cards helped or not at this point. The alternatives are pretty awful though and it's hard to go there if there's any way to avoid it. So I'm really not sure.

The irony is that I'm personally tight with money and real budget conscious. That's not always enough though so be warned. You just never really know sometimes.

 

[bananiem]

and when I can submit a resume with the Golden Ticket of College References on the top line and virtually guarantee myself an interview. That's all I need.

We get it, ok? We KNOW you have your precious Ivy League diploma. But you do realize that millions of people have degrees from other universities that have no problem getting interviews or calls from head hunters, right?
Sheesh! Enough already!

 

[dvcgirl]

We get it, ok? We KNOW you have your precious Ivy League diploma. But you do realize that millions of people have degrees from other universities that have no problem getting interviews or calls from head hunters, right?
Sheesh! Enough already!

Heh, well I think that you're being a little tough on Caradana, but to be honest, once I got my first "real job", the college that I attended was never brought up again in an interview. Previous jobs yes, experience yes, professional skills...yes, but college....never. My husband would say the same thing. An Ivy League degree may be a golden ticket to that first great job, but after that you've got to prove yourself just like everyone else.

 

[Aidensmom]

I understand that people have really bad things happen and do not have the money necessary to cover expeneses.

But with that said, is anybody really better off in the long run because credit cards were an option? Everything I've read about the typical situations basically comes down to credit cards making it worse, prolonging the problem long after the crisis is over.

Well, in my case I could still have an oak tree in my bedroom, along with by now all kinds of rain, snakes, and squirrels, or I could be paying on a credit card for a little while. I would definately say I was better off because I had a credit card as an option. I didn't have the large sum of cash which was the deductible for my homeowners insurance the day the tree came through. I however have no difficulty paying over twice the minimum payment each month on the card.

 

[cardaway]

Well, in my case I could still have an oak tree in my bedroom, along with by now all kinds of rain, snakes, and squirrels, or I could be paying on a credit card for a little while. I would definately say I was better off because I had a credit card as an option. I didn't have the large sum of cash which was the deductible for my homeowners insurance the day the tree came through. I however have no difficulty paying over twice the minimum payment each month on the card.

Not what I posted about, you had the money to pay it off, pretty quickly even.

I was posting about the folks who end up bankrupt.

 

[hentob]

All you have to do is read the posts here. I've lost count how many times I've seen people going on about their trip to Disney not long after having posted about financial problems in other threads.

Need vs. want is a problem with the adults, not just the kids.

I agree with this statement.

I have seen numerous accounts of people on these boards that have claimed (or were about to claim) BANKRUPTCY, yet their signature boasts tons of trips to WDW. Or, those who can't afford to feed or diaper their children, but alas, a trip to WDW is in the planning stages

I think if you are paying your credit cards on time, it is your business. No biggie what your balance is. It doesn't involve me.

But when you are claiming bankruptcy or are having others feed your own babies, yet you are planning a trip to WDW, you are not mentally stable.

 

[AllyandJack]

I have relatives like this....oh, they can't pay the cable bill....oh, they can't pay the water bill.....they borrowed my parents' car, but couldn't come up with $10. in gas money. Yet, they managed to buy roughly 45 gifts for my cousin's son. He's 3. He would have been equally as happy with 4 gifts. They also bought my cousin an iPod Nano.....because she needs her tunes while she sits on her rear end at home or goes out to buy her heroin.

They are in severe credit card debt. They've had a few refinancing fiascos - refinance to pay the credit cards and then have the newly increased mortgage AND the credit card debt because they can't control themselves. I have a feeling they are going to be hurting when the new minimum payments kick in.

For some reason, they don't see using credit cards as borrowing money that has to be repaid....they look at them as bank accounts with money in them.

 

[Planogirl]

For some reason, they don't see using credit cards as borrowing money that has to be repaid....they look at them as bank accounts with money in them.

My DH once had that belief. He learned his lesson long ago the hard way though.

To me, they're high interest loans that can help if used properly but they can also be a nightmare if they get out of control.

 

[dvcgirl]

I have relatives like this....oh, they can't pay the cable bill....oh, they can't pay the water bill.....they borrowed my parents' car, but couldn't come up with $10. in gas money. Yet, they managed to buy roughly 45 gifts for my cousin's son. He's 3. He would have been equally as happy with 4 gifts. They also bought my cousin an iPod Nano.....because she needs her tunes while she sits on her rear end at home or goes out to buy her heroin.

They are in severe credit card debt. They've had a few refinancing fiascos - refinance to pay the credit cards and then have the newly increased mortgage AND the credit card debt because they can't control themselves. I have a feeling they are going to be hurting when the new minimum payments kick in.

For some reason, they don't see using credit cards as borrowing money that has to be repaid....they look at them as bank accounts with money in them.

This is another very frightening trend. The old Refinance-cash out game. Clark Howard has recently reported some downright scary numbers on this topic. The amount of money that people are pulling out of their own homes is up *800%* since the year 2000. Anyone still think that the housing market isn't fueling our economy to a large degree?

He reported in early December that Fitch, a company that rated commercial mortgage services, is predicted that mortgage delinquencies are going to go up 15% in 2006. Why? People who have adjustable mortgages that are about to head up, risky lending products like interest only loans, and folks who have been using their homes like ATM machines during the real estate run-up.

This is why I personally advise against the refi deal to pay of CC debt. In most cases, taking out a loan to pay off a loan is a bad idea. So many times the behavior isn't changed and the CC are run right back up again. Eventually they run out of equity in the home and then they can't keep up with the larger mortgage payment since they've still got all of that CC debt. Sounds like your family members are heading down this treacherous road.

 

[graygables]

Walk a mile...

We had our 9yo DD after being told that I could have no more children by 3 different specialists. When we married, I lost my insurance (long story), so we had no coverage (only major medical) for her. When she was born and had a suspected intussuception, the bills started to mount. She needed special, very expensive formula that was NOT covered by anything and my DH was off work for 4 months. We needed those credit cards. Now, nearly 10 years later, we should have them paid off this year.

Yes, we have had several WDW vacations in the last few years (one was a prize from Kellogg's, some were paid for by my parents), but that is a CHOICE we made. We decided that we wanted our children to enjoy some of the things we did not have in our childhoods (WDW, specifically...I grew up in Germany, DH's family never took vacations) and as such, chose to continue to pay lower amounts to our creditors to have money available for making memories with our children, while they are still children. Extra money that someone else may have chosen to apply to debt, we chose to apply to something else and that does not make us any more of a "deadbeat" or someone to be looked down upon.

Medical insurance for the self-employed (not the Bill Gates' of the world, kind of self-employed) is horrific. What galls me is the "discounts" insured people get even when the insurance company doesn't actually pay anything (b/c it's still deductible or whatnot). There is a problem with health care and insurance in this country and it needs to be dealt with.

My main point is again...walk a mile before making judgments.

 

[cardaway]

Extra money that someone else may have chosen to apply to debt, we chose to apply to something else and that does not make us any more of a "deadbeat" or someone to be looked down upon.

No offense, but since you gave your opinion, I'll give mine.

That is flat out wrong IMO. Maybe this country needs to change the laws asince there doesn't seem to be enough incentive for people to pay their debts.

I've seen people call men "deadbeat dads" because they choose to apply their money to something else, maybe even a similar situation. (I agree they are deadbeat dads by BTW).

They sure have laws to make sure dads pay their bills.

 

[graygables]

No offense, but since you gave your opinion, I'll give mine.

That is flat out wrong IMO. Maybe this country needs to change the laws asince there doesn't seem to be enough incentive for people to pay their debts.

I've seen people call men "deadbeat dads" because they choose to apply their money to something else, maybe even a similar situation. (I agree they are deadbeat dads by BTW).

They sure have laws to make sure dads pay their bills.

You seemed to overlook the part where I said we still chose to pay our creditors just not as much as someone else might have (we were still paying above minimum). I did NOT say that we stopped paying. THAT is what a deadbeat dad is, BTW, someone who does not support his children and is a completely different animal.

 

[Aidensmom]

I don't believe graygables said they did not pay their debt AT ALL, just that they did not put every penny they had towards that debt. As long as someone is paying their minimum payments, I do not see that at all as any kind of deadbeat behavior. I don't put every penny I have towards my debts either, I only pay the required on my mortgage, cars, etc and about twice the minimum on my credit card. I could also use the money that we use to go to Disney or the movies or out to eat, etc on debt, but I would rather enjoy life too.

 

[vivilasvegas]

No offense, but since you gave your opinion, I'll give mine.

That is flat out wrong IMO. Maybe this country needs to change the laws asince there doesn't seem to be enough incentive for people to pay their debts.

I've seen people call men "deadbeat dads" because they choose to apply their money to something else, maybe even a similar situation. (I agree they are deadbeat dads by BTW).

They sure have laws to make sure dads pay their bills.

I think the incentive is the damage it does to your credit report. I had a credit card go to collections (younger then) and it killed my credit. I had a hard time getting approved for anything!! Now that my debt is just about paid off, I'm seeing my credit score improve.

What are you suggesting, jail-time??

 

[AllyandJack]

There is a huge difference between someone who uses their credit card for emergencies and pays on it every month and someone who racks up debt on crap they don't need and/or doesn't pay on it every month.

They're not the same. Not everyone with credit card debt are losers who buy Playstations and then file for bankruptcy. I have a $3,000 balance on my Disney Visa because a transmission needed to be replaced. I could have paid it off in 3 months if I didn't go to WDW in November. Do I regret my decision? Heck NO.

 

[mickeyfan2]

Yes it is a huge jump. They gave an example on the radio.

Old - took 41 years to pay off and 22,000 in interest
New - took 14 years to pay off and 4,500 in interest

So a little pain now is a great savings in the future.

 

[cardaway]

I don't believe graygables said they did not pay their debt AT ALL, just that they did not put every penny they had towards that debt. As long as someone is paying their minimum payments, I do not see that at all as any kind of deadbeat behavior. I don't put every penny I have towards my debts either, I only pay the required on my mortgage, cars, etc and about twice the minimum on my credit card. I could also use the money that we use to go to Disney or the movies or out to eat, etc on debt, but I would rather enjoy life too.

Once again people are taking what people are posting as saying they must pay off the entire balance. Simply not the case.

Not graygables, but other people flat out don't pay any amount to their debt in favor of spending it elsewhere that month. I even know people who rotate who they pay month by month, all the while never limiting how much they spend on extras.

 

[cardaway]

What are you suggesting, jail-time??

At least what they do to deadbeat dads, which IMO is a small problem compared to the number of people letting their crdit card debt go.

As bad as people feel about what people like myself are saying, that is how people like myself feel about the damage done by people who let their debts go. It's a serious problem and IMO something needs to be done about it.

It's to the point where there is so little done, people actually see it as an attractive option. Why not charge lots of things nobody could ever take away.

 

[JVL1018]

Very interesting article. I'd have believed it even without the study. When a couple of days in the hospital runs into the thousands of dollars, even without tests, it's small wonder the underinsured have very few options. A sudden illness can destroy your savings in a remarkably short time.

Or not even a couple of days..my son had a hole in his heart closed in October at-they did it using a catheter, no open heart surgery. He had the surgery done around 10:30 am. He went to his room(not private-it was with 3 other patients)around noon and was discharged at noon the next day.

His hospital stay breaks down like this:
room and board $2965.00
NY Surcharge $262.40
Ih Misc Services$18,364.10
NY Surcharge $1457.09

This was for 24 hours and included no surgery fees, no anesthesia fees, no EKG no echocardiogram fees no meds nothing.
$23,000

We did have insurance thankfully.

 

[vivilasvegas]

I guess I don't understand what you mean by so little done.

If you have bad credit, you are pretty much screwed. It takes credit for almost anything these days.

Maybe what the government does....I knew a guy who didn't pay his student loans, they flagged his social security number, and as soon as he started working, they started garnishing his wages!!

And if people got into trouble, careless or not, but came a long way paying off their debt, I don't consider them deadbeats.