Sapphyre wrote:
>
>
> I've known people in all different economic classes who "got into
> trouble" with credit cards. I've known people with 80K or more (Cdn
> dollar) per annum salaries who had 10K plus in debt. My neighbours
> where I used to live all owed a mountainload, and some were even being
> taken to court for "inability to pay". It amounts to financial
> stupidity. One person in the household is taking care of bills, and the
> other is spending THEIR income frivilously. This stuff happened in my
> own family and is one reason for my parents separation.
>
> I've even known people on welfare or disability who were granted a
> credit card by one of those "higher interest" organizations (so it's
> 28% per year, not 18%), the kind that take more risks. This guy racked
> up $6000 or more in debt shopping on eBay, and when his minimum payment
> became $200 per month, he screwed off on the card figuring it would
> never get paid off, so who cares? Had he not had the card, and been
> paying just the minimum and all that interest every month, he could
> have had no debt, and still managed to afford everything I'm sure.
>
> So while there are people who are wise enough to know what it's used
> for (a method of payment where cash/debit aren't reasonable, such as an
> online or phone purchase), or to buy something two days before pay day,
> or whatever the case may be. That is not the norm amongst buyers...
>
> The issue with overspending, debt, credit cards and lack of savings is
> something I studied in school. While that was just the statistical
> view, I'm a retailer, and I have friends who work at banks and for
> credit related companies... Our collaboration seems to confirm a lot of
> the statistics. I will also tell you, credit card debt is running
> rampant among University Students. Most students who have a card, have
> no clue how to manage it. ALL of my co-workers fit into this category,
> even when they are done school, they have a mountain load of debt that
> is NOT student loans.
I have mixed feelings about credit cards. I get offers for new credit cards
almost every week. When I graduated from university the major card companies
were all offering me one. I have been good with mine. I used to use mine instead
of going through the hassle of writing a cheque, and only if i had the money in
the bank. I have always paid mine off in full every month. But some people get
into a lot of trouble, maxing out and being unable to cope with the high interest
rates.
The way I figure it is that if someone (or company) extends credit to a person
who cannot afford to pay them back they deserve to get burned. You can't get
blood out of a stone. It's like having a deadbeat child or sibling that borrows
money. You don't really expect to get to be repaid.
Rather than give credit to every Tom, Dick and Harry, charging high interest
rates, and using collection companies and the courts to force repayment, credit
card companies should be more selective in their lending practices.
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