My Thoughts on Credit or, this economy
Here’s the thing about this whole economic mess: I feel like I’m the victim. Do you know what I mean? I do realize that I’m not the only victim, of course: there are the people who were talked into bad mortgages and the people who’ve lost jobs and (oh gosh) the people who invested in AIG or Freddie Mac.
But there are a lot of us (just look around at PF blogs) who have been trying, really trying to do everything the right way. We’ve been saving instead of spending, investing instead of splurging, researching instead of just believing what we’re told. We don’t use credit cards to buy things we can’t afford, you know? I guess for as long as I’ve been trying to be smart with money, I’ve been operating under a very basic ideology: that people who work hard and invest and stay informed will come out ahead.
There are no sure things, I hear people saying these days. Remember the Depression. Remember world wars. Sometimes times will be tough, so you have to focus on the good things.
And I have been, or I’ve been trying to. But, forgive me: Should I feel bad for people who max out their credit cards on luxuries? Should I want to pay higher taxes for people whose eyes were bigger than their pocketbooks? Am I being unfair? Does anyone else feel the same way?
When in the world, seriously, did credit cards become a necessity? Can we try to justify them as one now? When did we decide that we have to have certain things?
I remind myself often that things are much more complicated than they seem from my small perspective. And there are a lot of people who weren’t given my privileges, education or exposure to financial information. But still, a nagging, persistent little voice says something’s not right.
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10 Responses to “My Thoughts on Credit or, this economy”
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I understand where you’re coming from. However, I think if you’re investing right now…you’ll probably end up profiting on other people’s stupidity.
More than anything, I find this financial mess infuriating precisely for the reasons you discuss in your post. It just seems wrong that people who work hard to stay out of debt and (gasp!) live within their means are going to be punished because of the greed of big banks who sold bad mortgages and homeowners who bought houses they knew they couldn’t afford. I know everyone’s circumstances are different, but I really can’t believe that anyone involved in this nonsense is in any way innocent.
I agree. I think a lot of us are angry at how big this mess is and there is plenty of blame to go around. But now what? I’m mad, very mad, but I don’t think that the situation should be allowed to play out without intervention, because that would be even worse for everyone, including myself.
But yeah, I think that a lot of people are quite upset.
SD: I hope you’re right because, truth is, I’ve got a lot of savings riding on it.
L: Well, I guess there are *some* innocent people in everything, but you’re right: it’s definitely not the majority. Very frustrating and I hate the hand-out mentality that says we should just take, take, take.
SP: Yes, there is plenty of blame to go around. Sad thing is, the people we could blame aren’t the ones paying for it.
I really think your sweeping statements about credit cards detract from the post. There are plenty of people, like myself, who use credit cards responsibly and benefit from the convenience and rewards. I understand that many people are fooled by credit cards or simply do not lack the discipline to use them wisely - while this is unfortunate there are others who use them advantageously.
do not have the discipline*
I do not feel credit cards are in and of themselves evil, Philip. What I’m asking is this: why does society thing they’re NECESSARY now? I’ve heard the reasons financially savvy people use them–to build credit, get bonus points/free rewards/etc. But that’s something you’re choosing as a benefit to you, not a necessity. So my argument isn’t with those “responsible” users–it’s with the large majority of credit card users who think they have to have them to buy a bigger TV or more clothes or whatever. As I said in the post, I may be overgeneralizing, but this is what i think.
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I think that this peculiar phase of civilization will level out. Eeeeeeeeasy money’s only been -this- easy for a few years. People will bawl and complain and we’ll go back to credit that matches one’s means to pay.
Did you notice that Lay Away is coming back? Only in the discount stores now, but if it hasn’t spread from KMart over to corporate cousin Sears yet, it will. When it spreads to Sears, it’ll spread to Penney’s, when it spreads to Penney’s it’ll become necessary at small-market Macy’s, and then at large market Macy’s, and then every-where! (insert mad cackle here).
I don’t know if Neiman Marcus ever had lay away, but it’s a strategy the very high end stores need– getting “aspirational shoppers” out of the credit pool would go a long way toward fixing the “wear it once and return it” problem that that group of retailers struggles with.