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Anthony Bourdain on not having debt

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Re: Anthony Bourdain on not having debt

#71

Post by hueving »

mockery wrote: post #40
chjohasbrouck wrote: post #22

Earlier quoted context omitted.

Risk is one of the things that debt can represent, sometimes, but there can be debt that doesn't involve any risk, and there are risks that don't involve debt. What's risky about using a credit card to buy a kayak? And how does investing money you already have in small cap equities represent a debt? I think for the vast majority of individuals just trying to make good personal finance decisions, "don't take on debt"…

(I don't really agree with the simplification of debt = risk. Despite that...) > What's risky about using a credit card to buy a kayak? If you unexpectedly lose your job or are otherwise unable to pay off the card on the schedule you expected, you'll incur significant interest on the debt and end up having to pay far more than you originally planned. Compared with saving up money and paying in cash, there are clearly…

>If you had the money to pay off the card already and are just using the CC as a convenient method of payment, the risk is obviously far lower

Right, but you're still taking on debt for the month and then paying it in full. What is the risk?

Re: Anthony Bourdain on not having debt

#72

Post by hueving »

usaphp wrote: post #46
jeffdavis wrote: post #38

Earlier quoted context omitted.

To some, debt is a hit to one's freedom, dignity, and privacy. Most debt requires you to give a lot of personal information, tell a bank what you are buying, and then stick to a fairly arbitrary payment plan with various penlties for non-compliance. So it's perfectly sensible to minimize your debt for non-financial reasons.

buying a house, car, going to school, university, having a baby also requires you to give a lot of personal information, it does not mean its a reason not to use those things...

>it does not mean its a reason not to use those things...

It is for people really sensitive to privacy that are distrustful of institutions.

Re: Anthony Bourdain on not having debt

#73

Post by d_t_w »

L_226 wrote: post #56
d_t_w wrote: post #13

Earlier quoted context omitted.

I agree with your sentiment, but it strikes me that there is safety and opportunity in behaving badly when the bulk of your peers are swept away in an orgy of debt fuelled spending. Ten years ago I bought a small flat in London to live in. I paid a respectable deposit and didn't over-leverage. We were at the end of decade long property boom, there were huge concerns about the level of borrowing and ability to repay,…

Here in AU the Federal Government is considering allowing access to superannuation (compulsory retirement fund paid out of your wage) to first home buyers to help with a deposit. An interesting opinion piece[0] discusses how this might be construed as a ponzi scheme. [0] - http://www.abc.net.au/news/2017-03-16/super-for-housing-depo...

Similarly first home buyer grants or stamp duty concessions, they sound appealing to young couples struggling to enter the market but have repeatedly been shown to do nothing but inflate the market further.

When confronted with a golden goose that pumps money into the economy no politician wants to take a long term view of impacts, particularly when it's their generation making easy money at the expense of those who follow.

Re: Anthony Bourdain on not having debt

#74

Post by deepGem »

refurb wrote: post #21
vinhboy wrote: post #17

> Nobody likes paying high taxes, but I don’t mind. How refreshing. I agree with him. Paying my taxes is a point of pride for me. It's a repayment for all those years I was poor and the government paid for me to live and go to school.

Not sure if you're living in the US, but I do and I have the exact opposite viewpoint. The amount of waste, corruption and poor planning by the gov't makes me feel like I'm throwing money away. I'd rather give it a charity since then I'd know a majority of it had an impact. I think if the gov't was a bit more efficient and could be shown to be good stewards of money I'd probably hate paying taxes a lot less.

I live in India, one of the most corrupt countries that I have lived in. I cringe paying atrocious taxes. I shared your sentiment for a long time but these days I just am happy to pay whatever taxes like Bourdain says. To me personally, the effort required to optimise taxes is better spent elsewhere. Which is also why I cringe when startups talk about optimising taxes before even making a dime in profit and fall prey to registering their companies in low tax regions.

Re: Anthony Bourdain on not having debt

#75

Post by camillomiller »

coconut_crab wrote: post #41
_vn5r wrote: post #31

Earlier quoted context omitted.

What country is that?

Vietnam, ranks 110 or so in transparency index

Recently visited. It's a wonderful country. I loved the people, I love their pride and attitude. It's clear that you got some problems here and there (and maybe the family concept is a bit too strong). All in all, for me it's been just a wow after another. I met very few Americans, and each one of them was completely flabbergasted by how far the country and the people are from what they've been taught.

Re: Anthony Bourdain on not having debt

#76

Post by mseebach »

hueving wrote: post #71
mockery wrote: post #40

Earlier quoted context omitted.

(I don't really agree with the simplification of debt = risk. Despite that...) > What's risky about using a credit card to buy a kayak? If you unexpectedly lose your job or are otherwise unable to pay off the card on the schedule you expected, you'll incur significant interest on the debt and end up having to pay far more than you originally planned. Compared with saving up money and paying in cash, there are clearly…

>If you had the money to pay off the card already and are just using the CC as a convenient method of payment, the risk is obviously far lower Right, but you're still taking on debt for the month and then paying it in full. What is the risk?

As with risks, so with debts. There are large ones and small ones. Paying down a balance on a credit card every month is pretty low risk, but not as low as paying with a debit card in the first place.

Also, a credit card you're paying down monthly isn't really 'debt', isn't it usually something you do for the air miles or cashback?

Re: Anthony Bourdain on not having debt

#77

Post by camillomiller »

kevinmannix wrote: post #3

I wish more people thought this way. Debt can be be used effectively, but as Uncle Ben said, "With great power comes great responsibility." It seems that too much of America is wooed into a false sense of security by their ability to obtain debt without judging their ability to pay that debt off.

It surprises me all the time to see what you can do with a CC in America. Here in Europe it's also very common to have a direct debit card. You don't have a monthly bill, but the amount you spend is directly deducted from your account. Lots of people prefer that.

Re: Anthony Bourdain on not having debt

#78

Post by camillomiller »

Mikeb85 wrote: post #65

If your return on capital is higher than the interest rate, you should take on debt. If it's not (and for most it's not), then you shouldn't. Pretty simple. Anyhow, the article is an interesting anecdote about Bourdains life, but has little to do with money. He makes money from TV and books, can live comfortably because he makes quite a bit, but he's no financial savant.

Indeed. That's why Apple takes on debt and does bonds to pay dividends, buy back stock and other stuff they need to pay big money for. With their cash reserve money is dirty cheap and they can actually make more money cause people will rebuy their debt like hot cakes.

Re: Anthony Bourdain on not having debt

#79

Post by lastyearman »

kevinmannix wrote: post #3

I wish more people thought this way. Debt can be be used effectively, but as Uncle Ben said, "With great power comes great responsibility." It seems that too much of America is wooed into a false sense of security by their ability to obtain debt without judging their ability to pay that debt off.

Debt is new currency. If everyone is buying their cars with credit, soon nobody can afford to buy with cash. Around here even if you have decent wage right now, but not a stable job, you can't get credit to buy a house, while someone with a low pay but stable job can, you're effectively poorer than them.

Re: Anthony Bourdain on not having debt

#80

Post by camillomiller »

grecy wrote: post #57

I have always viewed debt as a promise of future labor. i.e. if I have debt now, I must go to work in the future to pay it back. Because I have no debt, I don't have to go to work, and can spend the next two years driving around Africa. I'm so passionate about saving money I even wrote an e-book on how to do it: http://theroadchoseme.com/work-less-to-live-your-dreams

I think you were downvoted for self-promotion, but I don't care, your blog is great. Good luck with your travels!
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