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Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

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Re: Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

#91

Post by JonFish85 »

superuser2 wrote: post #58

I propose that credit card debt is simply the earliest signal of "not making enough money to sustain the life you think of as normal." We have not yet come to terms with the fact that the overwhelming majority of people outside of a tiny sliver of elites are going to be lucky to afford bare subsistence in the years to come. Credit card debt lets us delay confrontation with the reality that wages have not grown enough…

Credit card debt probably isn't the "earliest" signal of that. We've been running pretty solid federal deficits for going on 40 years now -- that's probably a good indication that people feel that they deserve more than they pay for.

Re: Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

#92

Post by ChemicalWarfare »

lifeformed wrote: post #78
rm_-rf_slash wrote: post #25

Earlier quoted context omitted.

There was an eerily prescient 2006 documentary about consumer credit called "Maxed Out," which featured a scene where someone recalled going to a conference of bank and credit card executives, and one of the CC CEOs plainly stated: "The bulk of our profits come from people making minimum payments for the rest of their lives." As for "pay-in-full" folks like you and me, credit card companies could care less. Whenever…

How do CC companies make money off of minimum payments? Don't they lose money by lending more than what's paid back?

It's banks that do, CC companies primarily just facilitate the data exchange between the parties involved and charge per tx fee.

The way banks make money on those payments is the way any other interest loan payment works - you'll eventually pay what you owe but by the time you're done you paid the original debt + interest.

Re: Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

#93

Post by some-guy »

arbuge wrote: post #70
throwawaykeno wrote: post #60

Earlier quoted context omitted.

> Average credit card debt per U.S. adult, excluding zero-balance cards and store cards: $5,232.43 That is amazing and terrifying.

In a country with a GDP per capita (not per adult, to be clear - this includes non-adults) of around $50k, why would you feel that's terrifying?

It's not the amount by itself, it's the ridiculous interest rates on top of the amount.

Re: Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

#94

Post by toomuchtodo »

nametakenobv wrote: post #85
superuser2 wrote: post #58

I propose that credit card debt is simply the earliest signal of "not making enough money to sustain the life you think of as normal." We have not yet come to terms with the fact that the overwhelming majority of people outside of a tiny sliver of elites are going to be lucky to afford bare subsistence in the years to come. Credit card debt lets us delay confrontation with the reality that wages have not grown enough…

Please stop with this heart-breaking narrative about the unequal in income, starving americans. It's about iphones and clothes, not groceries.

> Nearly half of Americans would have trouble finding $400 to pay for an emergency.

http://www.theatlantic.com/magazine/archive/2016/05/my-secre...

Re: Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

#95

Post by joslin01 »

itchyouch wrote: post #84
askldfhjkasfhd wrote: post #67

Earlier quoted context omitted.

Can you elaborate on how you perceive the difference between the two examples here? Being financially foolish and negligent seem both to apply to your experience. "Was I being outright financially foolish ordering $100 bottles of Chardonnay at the club? Not at all. Was I being financially negligent ordering whatever small thing came my way that I wanted?"

A single large purchase is usually planned for and budgeted. E.g. buy computer for $2k and pay it off over the next couple of months $300/mo at a time. Though IMO, $100 of chardonnay at a club is pretty frivolous. Usually it is a death by a thousand cuts when it comes to racking up credit card debt. $20 for lunch, $50 for gas, $65 for some clothes, $100 for the electric bill. The problem is that pseudo-necessities li…

Yep - this.

They're both financially foolish, but I did not rack up credit card debt because of lavish purchases. It was just as ^ says.

Re: Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

#96

Post by joslin01 »

askldfhjkasfhd wrote: post #67
joslin01 wrote: post #44

Gather round and I'll tell you a tale of how to lose at the credit card game. When I turned 18, I got my first credit card. I asked my father "good idea?" and he said yea, good to build up credit. Ok then. A week later, my new card with a whopping limit of $750. Never having experienced not paying with cash I had, it gave me an odd thrill and I went out to eat with my friends and joked "It's like free money!" And des…

Can you elaborate on how you perceive the difference between the two examples here? Being financially foolish and negligent seem both to apply to your experience. "Was I being outright financially foolish ordering $100 bottles of Chardonnay at the club? Not at all. Was I being financially negligent ordering whatever small thing came my way that I wanted?"

Outright as in "completely" or "immediately" financially foolish is like going to the club with your friends and announcing drinks are on you. My negligence (as in, I didn't stay on top of it as good as I should have) I meant as more drawn out and not so painfully obvious. It's like a hole in a boat that you keep meaning to get around to, but hey the boat's still moving just fine.

Re: Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

#97

Post by dragontamer »

siscia wrote: post #27

Honest question. There aren't debit cards in the united states? They are simple plastic cards like credit carda but the bank is withdrawing your money directly from your account. There is not debt involved.

Credit cards are superior to debit cards in every way in the States.

Not only are credit cards more robust at consumer protection, but credit cards have 1% to 5% back deals. When I purchase gasoline, I get 3% back for example. As long as I pay back my credit cards every month, I never pay interest. AND I get the 3% back on gasoline and 2% back on groceries, 1% back on everything else.

There is almost no reason to use debit cards in the US. Use credit but pay it off.

Re: Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

#98

Post by damptowel »

JonFish85 wrote: post #91
superuser2 wrote: post #58

I propose that credit card debt is simply the earliest signal of "not making enough money to sustain the life you think of as normal." We have not yet come to terms with the fact that the overwhelming majority of people outside of a tiny sliver of elites are going to be lucky to afford bare subsistence in the years to come. Credit card debt lets us delay confrontation with the reality that wages have not grown enough…

Credit card debt probably isn't the "earliest" signal of that. We've been running pretty solid federal deficits for going on 40 years now -- that's probably a good indication that people feel that they deserve more than they pay for.

Governments have been running deficits for 5000 years, it's how currency is established.

Re: Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

#99

Post by [deleted] »

JonFish85 wrote: post #91
superuser2 wrote: post #58

I propose that credit card debt is simply the earliest signal of "not making enough money to sustain the life you think of as normal." We have not yet come to terms with the fact that the overwhelming majority of people outside of a tiny sliver of elites are going to be lucky to afford bare subsistence in the years to come. Credit card debt lets us delay confrontation with the reality that wages have not grown enough…

Credit card debt probably isn't the "earliest" signal of that. We've been running pretty solid federal deficits for going on 40 years now -- that's probably a good indication that people feel that they deserve more than they pay for.

[deleted]

Re: Credit-Card Debt Nears $1 Trillion as Banks Push Plastic

#100

Post by dionidium »

bluedino wrote: post #75
dionidium wrote: post #72

Earlier quoted context omitted.

How do you pay rent with credit?

Your landlord accepts credit card payments and you pay him/her with your credit card? No different than any other vendor. Mine charges like 2% or something to cover costs.

"Mine charges like 2% or something to cover costs."

What I meant to ask was, "How do you pay rent with credit (without paying $30-40 each month for the privilege)?"

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