(Closed) Debt on top of debt on top of debt

posted 6 years ago in The Lounge
Post # 77
Member
1233 posts
Bumble bee
  • Wedding: September 2010

between Darling Husband and I we have 100k in student loans, we just bought our first house too for 200k. We usually have about 15k in our bank at any given time.

Post # 78
Member
998 posts
Busy bee
  • Wedding: November 1999

@jesicka309:  

@MrsBeck:  I honestly do not see why both of you are so against financing a car.  I did not go out and buy a brand spanking new luxury vehicle, but I certainly had to have SOMETHING to get to and from work after my last car died.  Sure cars depreciate in value (everyone knows that), but some people HAVE to have a reliable vehicle to get them to and from work.  I don’t see anything wrong with financing an automobile as long as the person is responsible in the amount of loan they take out.

Post # 79
Member
727 posts
Busy bee
  • Wedding: June 2013

@MrsBeck:  As much as I think other people’s finances are nobody else’s business, I can relate to being curious/frustrated/etc when people openly discuss it and make judgements to your face about your spending habits (or lack thereof).

I’m a saver, absolutely.  I use debt wisely such as for my student loan (which is paid in full), and for my car (which was new, but financed at 0% with a warranty).  Darling Husband and I make very good money for our ages and for the region we live in.  Yet you wouldn’t know it if you visited our house.  We JUST got rid of our 25″ green tinted tube tv because our friends gifted us a huge flat screen for our wedding.  We have old shitty furniture and no decor.  We haven’t gone shopping for clothes in 2 years.  We don’t have many gadgets or toys.  I get the frustration when you look around and see, what it seems like, everyone you know with all new fancy stuff, holidays, houses, toys, etc.  I always chalk it up to us living within our means and knowing that there’s no way I could sleep at night knowing that I was in serious consumer debt and paying money for no reason (interest).

However, the part that frustrates me the most is when I’m labelled as being cheap.  Or when people get annoyed because I don’t have the money to attend some activity or purchase something.  I don’t go around telling them to their faces that they’re drowning in debt and should stop spending money they don’t have, so why is it appropriate to tell me I’m cheap because I’m living within my means?

It also frustrates me when I don’t want to spend money on items (decor, etc.) because I choose to save my money for larger expenses like travelling, or snowblowers.  Then when I am able to afford to go on a big trip, I get told that I must be rich and I probably make too much money because they could never afford to travel.  Usually I keep my mouth shut, but the odd time I open it and tell them to stop spending their money on junk and they could afford to go.

The bottom line is though, finances are personal decisions.

Post # 80
Member
727 posts
Busy bee
  • Wedding: June 2013

@OtterHalf:  +1

We both require vehicles to get to work, and to use at work.  We drive a lot on weekends.  We want reliable vehicles that we don’t have to worry about breaking down.  Sure, new vehicles can break down but the chance is way lower and there are warranties. 

My husband is a mechanic (albeit, a heavy equipment one, but anyway).  He refuses to purchase any more used vehicles.  We are smart when we buy new and don’t finance something with a ridiculous interest rate, and we don’t buy anything extravagant.  However, based on past experiences, the headaches that come with used vehicles aren’t worth the savings.  He doesn’t want to have to deal with the eventual repairs and maintenance that will most likely be far more frequent with a used vehicle.  And when you buy new, you’re the only one who’s driven it and you know what kind of abuse you put it through.

Also, when I was looking for my first vehicle I had planned on purchasing used.  I did not want something so old that I knew it would most likely require too much work.  It turned out that the cars that were 5 years old or so would have cost me more in the long run than the brand new one.  I financed my new car at 0%, whereas the used one would have been 6% or so.  Why would I buy used then?

Post # 83
Member
727 posts
Busy bee
  • Wedding: June 2013

@MrsBeck:  I don’t understand why anyone would purchase/finance anything that I would consider a luxury item.  Be it furniture, expensive cars, gadgets, etc.  However I don’t believe that a modest car is a luxury item, to me it’s a necessity to get me to work, and the fact that it’s reliable lets me sleep at night.  I personally do not understand why people upgrade to bigger flatter TVs when their big tube TV works perfectly fine, whether they can afford it or not.  The thing is, everyone has a different opinion on what is luxurious and what is not.  

I think the reason people live in debt is either because they are not educated about managing personal finances, or frankly they’d rather just live in the moment and have their stuff.  It’s pretty annoying sometimes as a person who lives within their means to see all the holidays people take, and the new cars people keep upgrading to, and the new boat, and the new trailer, and the new furniture, etc. and not somewhat be envious.  It’s frustrating sometimes knowing that we earn a decent living and yet we have less and do less than those who earn less because we live within our means rather than on credit.  It’s annoying to be told we’re cheap because we don’t have all the stuff.  I can say that sometimes I’m jealous and temporarily want to just say “screw it, everyone else seems to live happily in debt, why don’t we”.  Ultimately, that wont happen because I look at the end results.  So even as a practical person who lives pretty frugally, I can understand why other people keep up with the Jones’ and thus wind up in debt.

Post # 84
Member
727 posts
Busy bee
  • Wedding: June 2013

@MrsBeck:  You’re right, the topic wasn’t specifically about cars.  But, you wanted to understand why people go into debt for stuff.  I just gave you an example of why I chose to finance my car.  If I had just stated “because sometimes it makes sense to me”, that wouldn’t have been a very thorough answer.  I also gave my explanation because another bee brought it up.

Post # 85
Member
180 posts
Blushing bee

@MrsBeck:  Here’s my theory:

 

The availability of easy credit makes it more likely for someone to get into debt.  In many other countries, credit is much harder to come by.  Also, the U.S. is pretty superficial – materialistic, for one.  

 

Overall, we have a bad work/life balance compared to other countries, spend less time with family because we work more and in some cases, use material items to make up for what we lack in the other dept.  

 

As far as prefering to take out loans when not necessary, I can only speak for myself with an example.  When I graduated college I took out a car loan that was about 4/5 of my salary at the time (I was making around 25K, loan for about 20K).  It was a reliable car, but not luxury.  However, I was living a home, could easily afford the payments (even if I lost my job and had to do min. wage work) and knew I’d have it for a long time.  I didn’t NEED to buy a 20K car, but didn’t want to buy a used one and knew my salary would increase when I found a job in my field which I did soon after.  I paid off the car with extra principal payments years ago, and still drive it now (woo-hoo to no car payments!) and plan to keep it for a long time, until I have a child at least.

 

Post # 86
Member
9044 posts
Buzzing Beekeeper

@bklynbridetobe:  I think the problem is larger than that. People judge others finances without a second thought even if they do not divulge anything. You can see it on here all the time when a bride complains about someone not wanting to pay out money for their wedding and the retort is normally I know they can afford it, they have a great job or just bought concert tickets.

I always say that unless you are the person managing their finances then you have no idea what another persons financial situation really is. It doesn’t matter what they say, wear or buy or what their job is unless you have full access to their banking/finances then you have no idea what their circumstances really are and have no right to judge what they feel is acceptable spending for them.

Post # 87
Member
7371 posts
Busy Beekeeper

@j_jaye:  I agree with you on that note. You never really know, most people just make very broad assumptions.

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