“Bad” financial advice
Wow. I thought I’d left all the nasty name-calling when I stopped posting political opinions. But I’ve discovered a new sacred cow in America: credit. My post yesterday, Credit Card Zombies, drew some nasty responses. Positive responses, too, but the few ugly ones caught me by surprise. None of these replied to me directly, I found them over at a board called NotMSNMoney, on this thread.
I’m sorry…but jackass?
My friends, if I’m a jackass for wanting to keep my kids from giving away their money to banks and immersing themselves into our culture of debt, then guilty as charged. I am truly amazed that anyone would defend a lifestyle of debt. Someone must explain to me how it makes better economic sense to lose money in interest fees than to earn it in investment returns.
Let’s go back in history a bit, once again. Why is it that debt was never considered vital to our economic health until the last half of the 20th century? And well into the last half, mind you. If it was always such a good idea, why didn’t our grandparents think so?
The bank is your BFF…trust them!
Who is it that is offering our kids “good economic advice” by telling them to start buying things on credit? I’ll kindly ask that person to stay away from my kids. He ranks right up there with the marriage expert who advises watching porn to add a little spark to the romance.
Seriously, naysayers. Let’s forget the credit rating for a moment. That is a recent invention designed to keep us in debt. To what purpose does debt serve us? If I have insurance and an emergency fund, what is this disaster to befall me that will force me to rack up a huge debt?
The truth of the matter is that we don’t want to plan. We don’t want to prepare. We want to live for the day, buy what we want, and buy it now. I find when I discuss credit card debt, I never meet anyone who doesn’t pay off their balance every month. Amazing. Yet somehow the banks are making billions off of credit cards. These are the same folks who always break even at Vegas. I’ve yet to meet anyone who loses money at the Blackjack tables.
The truth will make you enemies
My friends, I am willing to take the hits. No, I’m not an economist. But I have learned valuable lessons and have enough common sense to know that buying a car with a sticker of $25,000 and paying $32,000 is probably not a wise investment, especially when said vehicle loses it’s value to the tune of $100 per week. Likewise, buying the TV, clothes, lunches, and everything else we desire on credit is just dumb.
The fact is that few of us use our credit cards for emergencies. We use them so we don’t have to wait. If you’re the rare individual who has never held a balance, God bless you. You may drop a “jackass” in the comments and move on.
Based on the numbers that the banks themselves reveal in their annual reports, though, I’d say you are a rare bird indeed.
So, kids, here’s more “bad financial advice:” Pay cash or don’t buy it. If you want it, save up for it. If you think you may have an emergency in the next 60 years, save up a fund for that as well. I’ll get to work on some posts explaining exactly how to do that. You just keep an eye out for the predators who are after your money.
God bless you and, please, always question “normal” behavior.