Is it just me, or...

[ducklite]

Do you find it incredibly odd when people talk about having debts like credit card debt equalling their annual income or car loans/leases that eat up 30% of their take-home pay and then in the next breath talk incessantly about the next cruise or Disney trip they are taking, or spending a huge amount of money on a lavish party or wedding?

I have a friend who can't even keep her phone from being disconnected three times a year, but they eat out constantly and always have at least one cruise or other vacation planned--"because they need to get away." IMHO they are only trying to escape a few days of collection calls, and if they'd just stop thier irresponsible spending and pay thier bills they wouldn't need to get away. Maybe "run away" is a better term.

There are a few people I've run across on various Internet boards who are the same way. They practically brag about the insane amount of debt they are carrying and how broke they are, but always have at least a couple of expensive vacations or some expensive non-essential purchase planned. A person on one board is talking about putting in a $60K pool, but her DH is getting laid off in two months with not a high chance of finding another job soon and they are borrowing the cash--they are barely keeping thier head above water with bills as it is.

I just don't get it. Aren't they at all concerned for thier future? Don't they realize that sooner or later they are going to have to pay those bills, and eventually the credit card companies will stop giving them credit line increases? Are they in denial or do they just not care?

Is it our business as consumers to be concerned--as the potential bankruptcy and charged-off debts will be passed on to us--or should we just look the other way?

Anne

 

[crazyme5kids]

My BIL and SIL are those people. We found out why. The stole every penny my MIL had . Then when the well went dry the filed for bankruptcy and took off for Colorado.

 

[disykat]

I don't know anyone IRL who does this (in terms of vacations, anyway), but I've seen quite a few on the DIS. In real life, the debt ridden people I run into get themselves into more trouble with little things like going to movies, eating out, cable television, brand name clothes for their kids, etc.

 

[twinklebug]

Do you find it incredibly odd when people talk about having debts like credit card debt equalling their annual income or car loans/leases that eat up 30% of their take-home pay and then in the next breath talk incessantly about the next cruise or Disney trip they are taking, or spending a huge amount of money on a lavish party or wedding?
...

I just don't get it. Aren't they at all concerned for thier future? Don't they realize that sooner or later they are going to have to pay those bills, and eventually the credit card companies will stop giving them credit line increases? Are they in denial or do they just not care?

Is it our business as consumers to be concerned--as the potential bankruptcy and charged-off debts will be passed on to us--or should we just look the other way?

I am as concerned about debt being passed on to us as a whole from irresponsible spending as you are, however, finances to me are as taboo in conversation as religion or politics. There's usually too much one-sided-ness going on from all parties involved & never can an agreement to disagree be reached.

One thing to consider is that not all consumers who have racked up huge debts are as irresponsible as you think when they announce a wedding or a vacation. Some people work very hard for years and years trying to get out of debt, but problems have a way of following them & everyone needs an emotional break from anxiety producing troubles even if for a day of celebrating a new life with a spouse. Also, Disney vacations can be just as expensive or as cheap as you're willing to make them. Not everyone is staying conceriege at the Poly, some will camp, others will wait for a great deal and use the values for 3 or 4 days and drive back and forth hoping to save some money from flying.

I can't point fingers and label anyone a "bad consumer" just because they have $40K in debt and are having a wedding or taking the kids to Disney for the first vacation they've had in 8 years as a family when I don't know all the details. I do find it odd that people will post their financial status on the web assuming no one can find out who they are. Apparently they're not aware that they leave a fingerprint with every post.

 

[ducklite]

I am as concerned about debt being passed on to us as a whole from irresponsible spending as you are, however, finances to me are as taboo in conversation as religion or politics. There's usually too much one-sided-ness going on from all parties involved & never can an agreement to disagree be reached.

One thing to consider is that not all consumers who have racked up huge debts are as irresponsible as you think when they announce a wedding or a vacation. Some people work very hard for years and years trying to get out of debt, but problems have a way of following them & everyone needs an emotional break from anxiety producing troubles even if for a day of celebrating a new life with a spouse.

I'm not saying that someone with their annual income in credit card debt shouldn't celebrate a life event, but when you are making $40K a year, have $40K in credit card debt, and then spend $40K on a wedding, or $5000 on a WDW trip, that's irresponsible, and frankly the rest of us are going to pay for all that fun when the house of cards falls. Not if, when. You can only go on robbing Peter to pay Paul for just so long.

Also, Disney vacations can be just as expensive or as cheap as you're willing to make them. Not everyone is staying conceriege at the Poly, some will camp, others will wait for a great deal and use the values for 3 or 4 days and drive back and forth hoping to save some money from flying.

I'll give you that as well, but more often than not the ones who are crying poverty ARE staying concierge and flying and renting cars because they don't want to wait for DME and staying for 10-14 days. Again, in the long run the rest of us will pay for that vacation.

I can't point fingers and label anyone a "bad consumer" just because they have $40K in debt and are having a wedding or taking the kids to Disney for the first vacation they've had in 8 years as a family when I don't know all the details. I do find it odd that people will post their financial status on the web assuming no one can find out who they are. Apparently they're not aware that they leave a fingerprint with every post.

I'm not talking about the people who have had some sort of medical crisis or other unexpected and unpreventable event. I'm referring to people who spend every dime they make living well beyond their means. People who take three or four vacations a year--and I'm not talking about camping at the state park or staying with relatives, I'm talking expensive vacations to expensive resorts, admittedly paid for on credit cards. Again, you and I will end up paying for their vacations, restaurant meals, expensive clothes, and electronic toys.

I really, really wish the credit card companies and lenders would tighten up! If you make $40K a year and have $60K in debt--you'll be dead before it's paid back! Then all that fun ends up being paid for by everyone else. It's almost like privately run welfare in a perverse way.

Anne

 

[ZachnElli]

Nope, I don't know anybody like that. I don't know how someone would get approved for a car loan/lease that took up 30% of their income.

 

[mytwotinks]

I would almost bet that the people who think they don't know someone living like this really does, they just don't know it!

I just did an obligatory visit of a friends new house and saw a new flat screen t.v. in their living room (huge) and one in her room (pretty big) and one in each of her three kids rooms (not tiny!) She said, "we're always broke anyway so we decided we were going to start buying stuff." This is a woman that went Christmas shopping writing checks that she knew were going to bounce!!!!!! She told me this after we had been in tons of stores and she had writting checks in every one of them! She even wrote 2 checks in Mardel (Christian book store) because after she paid she thought of something else she wanted to buy!

I am sure that I am the only person in our town that knows the truth about her finances. People like her (and I know plenty) are the reason that I never compare our $$$ situation to others. You never know what they are doing to make it work. I prefer not to create tons of bad debt, but that's just me. I have learned over the years that there are many many people who do not feel the same way!

 

[twinklebug]

I'm referring to people who spend every dime they make living well beyond their means. People who take three or four vacations a year--and I'm not talking about camping at the state park or staying with relatives, I'm talking expensive vacations to expensive resorts, admittedly paid for on credit cards. Again, you and I will end up paying for their vacations, restaurant meals, expensive clothes, and electronic toys.

I really, really wish the credit card companies and lenders would tighten up! If you make $40K a year and have $60K in debt--you'll be dead before it's paid back! Then all that fun ends up being paid for by everyone else. It's almost like privately run welfare in a perverse way.

I'm happy to say I've never met anyone like those you are referring to - but I have heard of them & I know one guy who's well on his way to becoming one.
It would be nice if the companies would take a close look into people's income/spending personalities before extending them credit and not just their credit scores which have become a joke (really, it doesn't take much to bump up a score for a month or two & like I said I know a guy who's irresponsible with his debt and has a better score than most, myself included & I'm quite obsessive about paying all my bills!)

 

[azgal81]

I don't understand the draw of having debt. I guess some people just need the latest and newest of everything to make themselves happy. Why buy something you can't afford.

I also have to get away and travel because it's so much fun but I save money each month to do so!

I guess if I spend time to think about being in debt it seems silly to me that people would actually want to be. I usually don't think twice about it though since I don't know the persons situation.

 

[ducklite]

Nope, I don't know anybody like that. I don't know how someone would get approved for a car loan/lease that took up 30% of their income.

"Bad credit" finance companies will lend on that type of situation. A girl I work with has a lease for a 2007 SUV that's worth about $35K, this girl doesn't even make $25K a year. All she does is complain that she's broke because her car payment takes up half of her take home pay, and she didn't have enough money to get her nails done last week. Since she bought the thing about six months ago she's made her credit card payments with cash advances from the other card at least twice. Talk about a house of cards!

A few of us were trying to steer her towards a KIA or something along those lines, but she because they were "not her style."

Anne

 

[twinklebug]

"Bad credit" finance companies will lend on that type of situation. A girl I work with has a lease for a 2007 SUV that's worth about $35K, this girl doesn't even make $25K a year. All she does is complain that she's broke because her car payment takes up half of her take home pay, and she didn't have enough money to get her nails done last week. Since she bought the thing about six months ago she's made her credit card payments with cash advances from the other card at least twice. Talk about a house of cards!

A few of us were trying to steer her towards a KIA or something along those lines, but she because they were "not her style."

Key word put in bold. For some, debt is a lesson in life. Sounds like she needed her father with her when she made the decision to buy that car. Bet she's grumbling over the new car-young driver insurance cost too.

 

[sha_lyn]

I've know a few who do that. The worst being a couple that filed for debit releif (or what ever it is called. Where you work out payment plans that are a fraction of what you owe. Not bankruptcy where your debts are liquidated)2x. Both times due to over spending, not from falling on hard times. I know the 1st time they went out and spent like crazy right before filing. They figured they might as well have everything they wanted when they filed. They filled their home with new furniture, appliances, bought a new truck etc.

We moved away soon after that. About 12 yrs later the wife found me online. We started talking and I found out they have filed again. Once again going out on a big shopping spree right before.

 

[ducklite]

Key word put in bold. For some, debt is a lesson in life. Sounds like she needed her father with her when she made the decision to buy that car. Bet she's grumbling over the new car-young driver insurance cost too.

I should have said a woman. Sh'e 54 years old.

Anne

 

[twinklebug]

I should have said a woman. Sh'e 54 years old.

Anne

What can I say?
Perhaps she's newly divorced, child-like or hoping for the magic fairy to help her out? Oy.

 

[ducklite]

I've know a few who do that. The worst being a couple that filed for debit releif (or what ever it is called. Where you work out payment plans that are a fraction of what you owe. Not bankruptcy where your debts are liquidated)2x. Both times due to over spending, not from falling on hard times. I know the 1st time they went out and spent like crazy right before filing. They figured they might as well have everything they wanted when they filed. They filled their home with new furniture, appliances, bought a new truck etc.

We moved away soon after that. About 12 yrs later the wife found me online. We started talking and I found out they have filed again. Once again going out on a big shopping spree right before.

I know a girl (lady) who is my age who has filed BK as a way of life. The first time she was a single mom who chewed through her deceased husbands $100K life insurance in two years, then filed chapter 7 after making sure she and her son had every gadget and clothing item they'd need forever!

She remarried to a guy who filed chapter 7 the month before thier wedding because he was living beyond his means. Before they met he worked about 15 hours of OT a week, and was living that way. When they started dating he stopped OT but didn't cut back his spending, and you know the rest.

Two years after they married they bought a house, and within two years were in foreclosure because she decided she didn't want to work anymore, and he got laid off and she didn't want to go back to work. About two months after being evicted, they wre living in his mothers house and they filed chapter 13. 18 months after that they were in default on those payments and filed another 13. Last I heard they were converting to a 7. Of course they have continued to spend like crazy. borrowing money from friends and relatives--most of whome will no longer speak to them. it's actually really sad.

Anne

 

[ducklite]

What can I say?
Perhaps she's newly divorced, child-like or hoping for the magic fairy to help her out? Oy.

Nope, she's been divorced for six or seven years now, and just wants to be a "princess." I think she's delusionally thinking that her boyfriend will bail her out eventually, what she doesn't stop to think about is that he can barely pay his bills.

Oh, and she had three new outfits last week and said she was planning on doing more clothes shopping this weekend. yeah. I would have left her too if she were my wife.

Anne

 

[MushyMushy]

I don't know how some people do it with the vacationing. We went a good nine years before we ever took one -- I mean, we probably could have, but it certainly wouldn't have been good for our financial situation. It's not a necessity, for as much as today I'd like to justify it as such.

But I think the problem is bigger than people who take luxury vacations and buy big ticket items. We've been guilty of that ourselves in the past of just nickel and diming ourselves to death. We live in an instant gratification world, and that's part of the problem.

 

[twinklebug]

Nope, she's been divorced for six or seven years now, and just wants to be a "princess." I think she's delusionally thinking that her boyfriend will bail her out eventually, what she doesn't stop to think about is that he can barely pay his bills.

Oh, and she had three new outfits last week and said she was planning on doing more clothes shopping this weekend. yeah. I would have left her too if she were my wife.

Anne

Ah ha! Look at the calender... Is a tax refund in her near future? The guy I refered to as being on the downslope gets into the frame of mind that if he sees money in his account, or knows it may be there soon then he can go spending.

 

[sha_lyn]

Wwhat really got me about that couple was they acted so clueless.
"Why would they let us finance that stuff, give us those CC limits etc if we couldn't pay it." If they spent like the average person they probably could have paid the debts. However when you eat out 3x a day (both would pick up breakfast on the way to work, eat lunch out then they would to out for dinner), buy several new outfits a week, drink and smoke like crazy (the husband did the wife didn't) and barely have the $$ to pay the pay the bills at the end of the month, it isn't the time to go out and finance something else

 

[mickeyfan2]

I know somebody like this. I won't go into details.