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Yeah, i think its primarily your peer group. Its not a subject most people discuss freely, but you can generally tell when someone is putting out more than they make. The people i know buy purses because they are pretty, or new iphones because "its only $40/mo and so on. I am the odd one of the people i know because i dont do those things or i wait until i have the money saved up to do them. I dont make much for sure, but i would bet decent money that i could not find a single person i know who can consistantly save 15+% of their monthly income like i do. When i do take “loans” they are low interest (~7%) because i am borrowing against assets i have built up and not with cards.
Sure, and I generally avoid people who buy expensive things regularly because those things just don’t interest me. My in-laws are kind of like that, but they buy in cash instead of credit and avoid monthly charges, so they save up for whatever the expensive thing is.
I know a lot of people get into consumer debt, I just don’t interact personally with them. Most of the issues I see are overextension on very expensive, illiquid assets (car, house, time share, etc) and then a sudden financial change (job loss, hospital bills, etc) that causes things to spiral out of control instead of a steady squeeze from high interest.
I’m interested to know which perspective is more common.
I think i read somewhere that the average person has $5k in credit card debt and something like 60% of people couldnt cover a sudden $400 expense without a credit card.
I’ve seen those too, but I’m not really sure how dependable they are. For example, I probably have $5k credit card debt, but I never carry a balance. I also only have like $500 in a savings account, but I have several thousand in bonds, like tbills and ibonds. A lot of people don’t like to hold much cash, and would just cut unnecessary expenses to pay off an expense on time using a credit card and then return to prior spending.
How things are defined matter a lot, and it’s easy to narrow or widen definitions to sell a narrative. If you’re selling budgeting advice, you want to exaggerate debt and people being unprepared for emergencies. If you’re selling investments, you want to emphasize financial stability of other people so customers feel like they need to invest more. If you’re a government agency, you want to sell need for more funding for your agency. And so on.
Yeah, i think its primarily your peer group. Its not a subject most people discuss freely, but you can generally tell when someone is putting out more than they make. The people i know buy purses because they are pretty, or new iphones because "its only $40/mo and so on. I am the odd one of the people i know because i dont do those things or i wait until i have the money saved up to do them. I dont make much for sure, but i would bet decent money that i could not find a single person i know who can consistantly save 15+% of their monthly income like i do. When i do take “loans” they are low interest (~7%) because i am borrowing against assets i have built up and not with cards.
Sure, and I generally avoid people who buy expensive things regularly because those things just don’t interest me. My in-laws are kind of like that, but they buy in cash instead of credit and avoid monthly charges, so they save up for whatever the expensive thing is.
I know a lot of people get into consumer debt, I just don’t interact personally with them. Most of the issues I see are overextension on very expensive, illiquid assets (car, house, time share, etc) and then a sudden financial change (job loss, hospital bills, etc) that causes things to spiral out of control instead of a steady squeeze from high interest.
I’m interested to know which perspective is more common.
I think i read somewhere that the average person has $5k in credit card debt and something like 60% of people couldnt cover a sudden $400 expense without a credit card.
I’ve seen those too, but I’m not really sure how dependable they are. For example, I probably have $5k credit card debt, but I never carry a balance. I also only have like $500 in a savings account, but I have several thousand in bonds, like tbills and ibonds. A lot of people don’t like to hold much cash, and would just cut unnecessary expenses to pay off an expense on time using a credit card and then return to prior spending.
How things are defined matter a lot, and it’s easy to narrow or widen definitions to sell a narrative. If you’re selling budgeting advice, you want to exaggerate debt and people being unprepared for emergencies. If you’re selling investments, you want to emphasize financial stability of other people so customers feel like they need to invest more. If you’re a government agency, you want to sell need for more funding for your agency. And so on.