FREE MONEY?: FAST FOOD, INTERNET PORN AND CREDIT CARDS A YOUNG MAN’S THREE PITFALLS

by admin on November 1, 2012

It dawned on me in college when I saw credit card applications being stuffed into the bags at college bookstores in the mid 1990’s: My generation was in trouble. Our parents, the baby boomers were the first ones to really perfect the credit card, and use it on a regular basis. The generation before that had lay away, where the store would keep the item, and the customer would come in every week and make a small payment towards it obtainment. Although there is still lay away these days, most decide to put it on the old plastic card in order to get it now.

Most of my generation who are now young parents, and late 20 something’s really don’t even know what lay away is, but we do know what credit cards are, as most of us have at least one. Most of us also carry a balance on it as well, meaning we don’t pay off 100% of our bill from one month to the next. Mainly it is because we don’t have the money. We are having that money loaned to us at between 11-28% conservatively. Estimates on how much credit card debt the average person has varies, depending on who you ask, but it is usually between $3000-9000. That is average, even taking into account those who pay off everything, every month.

That means there are plenty people with $20,000 to as high as $50,000 worth of credit card debt. Many of them are only in there 20-30’s. Many are even “educated”, walking out of a four year degree college (which took them six years to complete), with tens of thousands of dollars of college debt on top of their tens of thousands of credit card debt. Many see it as normal, as it has become common. Credit cards have taught us some incredibly bad money managing habits.

Before I go any further, let me say that credit cards can be useful, and I use mine almost weekly. I never carried a balance until sometime around my early 30’s, mainly using it for business financing on particular project. Even when I did that I always had short term savings to back it up, and always paid my tithe and savings first. In the last couple sentences there was some bad decisions made along with good ones, so I am far from perfect in this area. However, over the years I’ve continued to improve and get better each and every year.

The problem is that getting credit on these cards is not tough, running up a balance is easy, and declaring bankruptcy is the game plan for many who get themselves in trouble. People who ran up balances, and didn’t pay them off, sometimes not even paying the minimum saw their credit scores drop in the 1990’s, but didn’t care so much. The economy was booming, and finding car dealers, mortgage companies and other lenders to see past bad credit was easy. Then 2008 happened. The economy pulled back, people lost their jobs, and credit scores became even more important. As I write this in the 2010’s, many are now stuck with low credit scores, some with bankruptcies, and others with a very poor financial track record.

I would love to say credit cards are the culprit, as that is part of the title for this entry… But just as fast food and internet porn, the problem is ourselves. As much as I like some of the food at McDonald’s, they are not sticking a gun to my head for me to pull over and enter their drive thrus. Is sex around us everywhere? Some would argue yes… whether you find yourself typing explicit phrases into Google, choosing a Hollywood movie because of its sexual content or rewinding your Tivo dozens of times because a pop star exposed herself during a Superbowl show. However, the responsibility is still ours. We don’t need to search for certain Google terms, see that blockbuster (there are millions of other choices), or rewind our DVR’s to rewatch a little celebrity skin.

Same with credit cards. They are a tool, something to help us organize our finances, get extras for normal spending we usually take part in and live conveniently. It is enticing to overspend more than we make? Yes. Is it easy to shop from home at 2am in the morning, of course. However, just because something is easy, doesn’t mean it is anymore ok to take part in it. Wow, let me say that again…

Just because something is easy, doesn’t mean it is anymore “ok” to take part in it. When tempted to make a wrong decision, that is what I’m going to recite to myself, and I hope you do too.

If you find yourself struggling to keep your head above water, pay off an enormous credit card bill, or feel like your spending may be an addiction, please get help. There are several non for profit credit counseling organizations which will help you out for free, or near for free. Just Google it online… but don’t confuse them with credit card consolidation companies. You need a plan, a budget, a means for help… not someone who will charge you for helping you do something you can do yourself (plus, the process is part of the growth and healing).

Come back next week as I try to tie these things up: FAST FOOD, INTERNET PORN AND CREDIT CARDS, A YOUNG MAN’S THREE PITFALLS

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