Stupid Debt

Bronte said:
Clubman there are an awful lot of people here on AAM who are rolling over their debt
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And lots who are not. You said "everybody".
But this one third isn't going to help the rest are they?
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Eh? So what and why should they? My point was a rebuttal of your point about "everybody buying everything on credit".
Re the furniture shop....... it's a long story and ye wouldn't believe me but it's linked to the new 'Americanised' Ireland.
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So "Americanisation of Ireland" made you go shopping? Give us a break. Do you not have a mind of your own...
 
I am pretty certain that most banks in this country have bought into the whole corporate citizenship thing and while I entirely agree that debt is the responsibility of those that incur it, I do wonder how unsolicited mailshots telling you you have "pre-qualified" for a loan amount of say €10,000 but must avail of it by a set date aligns with good citizenship. They had to be persuaded to give up on the "Congratulations, you have qualified for a limit increase. You new limit is..." approach to making valuable customers, again this doesn't ring true in my mind with good citizenship. The subtle message of these methods is that it is okay for you to take on extra debt, the bank believes in your ability to repay. While this may not convince everyone, people believe in banks and trust their pronouncements on a persons fitness to carry debt. Historically debt would have been more difficult for an ordinary citizen to incur because they would have had to try harder for a loan and would have been harder pressed to repay it. Susceptible people find it easier nowadays to fall into debt, it does not mean they should be mollycoddled but perhaps lending institutions do bear a social responsibility towards their vulnerable customers and it would seem from anecdote (and probably evidence but I can't quote anything so I won't) that this is not being exercised.

Also, we are more exposed to debt in every day transactions, cashless systems where you are not handing over notes and coins can mean that people are less aware of what they are spending and less conscious of and connected to debts that they owe. Sudden prosperity, cashless systems and easy credit has resulted in a generation of avid consumers and willing, perhaps unaware, risk-takers. Although it is most certainly not confined to that generation, it is most prevalent there. I think part of the problem certainly was (and maybe still is) a lack of basic education on money management, their parents would have had for the most part a much smaller set of credit options and a more limited opportunity to avail of them and it wasn't a core part of the school curriculum. This puts naive people in a disadvantaged position.

Of course there is always the small number who appear to view the world as their oyster and the bill as someone elses problem, but not all people in trouble in debt are these people.

The founder of the Grameen Bank, Muhammad Yunnus, believes that credit should be a human right, I would agree but we need to ensure that the correct education is provided early in life teaching that credit is a tool and not a habit.
 
So "Americanisation of Ireland" made you go shopping? Give us a break. Do you not have a mind of your own...
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<rant>
It's not that simple. I'm all for people knowing their own mind and personal responsibility but I personally find it difficult not to notice the commericalisation. I'm sick of ads, shops, being marketed at with total rubbish statements some marketing droid made up. It's pervasive. You'd have to be a droid yourself to be immune. You can talk about common sense, money management - unfortunatley as so-crates pointed out we're not all as on top of things as we ideally should be. I notice this particularly if I have to do or buy something I've never bought before, or find myself in a situation I've never had to deal with. If you are not informed about the intricate ins and outs of whatever it is, it can be a very confusing experience and I can easily see how people who are time pushed or confused are pressured. A good example would be anything to do with health or "wellness". It's all very well saying "be sensible" but sometimes you do, in spite of your common sense, find yourself in a health situation where you feel you have to do / buy something and are not equipped to make the right choice. It feels like everything combined is pushing you to buy something no matter what just as long as you buy it. Why why why do we still allow marketing and advertising to children? Has to be the most unethical thing going.</rant>
 
annR said:
Why why why do we still allow marketing and advertising to children? Has to be the most unethical thing going.</rant>
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I'd put the trade in organs from executed Chinese prisoners ahead of it but you are entitled to your opinion.
 
[broken link removed]

Here's a look at global credit card use, Ireland included.
 
You simply can't generalize a segment of the population.

For example, I have two friends, both in their mid-twenties, both university educated and both earning about the average industrial wage.

The first friend is as canny as you can get. Lives comfortably without splurging and never buys on credit. Has his cash spread from high interest deposits, right up to sensible equities. He even saw the gold bull run a few years back and is all set to cash in. Prides himself on not owing anyone a single penny and from what I can gather, would have well over €100,000 (like a true Canny McSavvy, he keeps his worth close to his chest). Other than getting luck with one stock purchase, he accumulated everything earning a modest enough salary.

The other friend despite his education, is completely hopeless with his money. His only asset is his rapidly depreciating Hyundai Accent. Yet he has three maxed out credit cards, his bank personal and car loan and a credit union loan. Probably €40-€50k in debt with absolutely nothing to show for it. With him, I don't think he realises the gravity of the cash that he owes, whenever I mentioned it, he just shrugged his shoulders and said that that was life.
 
Maybe he's had a blast and has some good memories and experiences

The balance needs to be had, you can't expect people to work hard 5/6 days a weeks and save every penny. Of course you work to feed, cloth and put a roof over your head but you've got to enjoy some of your salary totherwise, what's the point. You will probably be dead by the age of 75 or not fit enough to enjoy life so when are you going to enjoy life. You should do it while you are fit and healthy enough to enjoy it.

Balance is good. Squirrling away every penny and not enjoyng yourself is bad as is spending without considering how much you'lll have to work to pay it back.
 
Niallers said:
Balance is good. Squirrling away every penny and not enjoyng yourself is bad as is spending without considering how much you'lll have to work to pay it back.
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Not to be a spoilsport but I would definitely disagree with you there. I don't think one is as bad as the other. Squirreling might seem a bit joyless but it does have the advantage of a more likely, tangible, long-term, benefit (bungee jump, great fun, but not exactly something you can live off in your seventies). People are too apt to assume that their own instant gratification (which is generally what we enjoy most) has more importance or relevance to their lives as a whole.
Balance is good, yes, but great memories of fun that lasted for a few minutes which you pay financially over several years is not balance, that is craven consumerism.
I can't advocate saving at the expense of living but I would advocate living within your means and if you are buying today's fun at tomorrow's price you simply aren't doing that. Why ruin a great memory with bitter regret?
 
With the way inflation is going it might be better to buy the fun at todays prices.
 
3 and a half months Nialler - you been out enjoying yourself?

That was exactly my point, pay cash (today's price) not credit (tomorrow's)
 
I didn't think when I wrote back in February that the easy money was going to go so soon and the equity is gone for lots of people. It's only been 4 months since and how quickly things changed.
Anyway back to the furniture shop. All the new big shopping estates look like America to me. I went into a shop called Reeds I think, I was looking for bedcovers for a rented property and was truly amazed at the instore advertising for credit.
AnnR - I don't do shopping, not in the conventional sense. The last time I bought clothes for the kids was xmas, in Dublin, Penneys, nobody there, kids in middle of floor and tried on everything there and then (very relaxed it is in Ireland) purchased millions of clothes for about 150 Euro. The rest of Ireland as far as I could tell were shopping in BT, I don't think they will next xmas and it's probably going to kill them.
 
AnnR - I don't do shopping, not in the conventional sense. The last time I bought clothes for the kids was xmas, in Dublin, Penneys, nobody there, kids in middle of floor and tried on everything there and then (very relaxed it is in Ireland) purchased millions of clothes for about 150 Euro. The rest of Ireland as far as I could tell were shopping in BT, I don't think they will next xmas and it's probably going to kill them.[/quote]


I agree - better get to Pennys in November this year too!
 
I was listening to the radio and they were talking about the crazy money people pay out for First Communions. The St Vincent de Paul guy made the point that often it's not well off people spending this money on tiaras and marquees etc but less well off people. I've noticed this myself, it sometimes seems to be that people who aren't well off or can't afford it are the ones buying the most crap. Wonder why that is.
 

Anyone who gets into debt to finance this sort of thing is a fool.
 
Purple said:
Anyone who gets into debt to finance this sort of thing is a fool.
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Hey! Bit of respect there... It's a well known fact that mystical beings place great store in what you wear when presenting yourself in front of them to receive special magical vibes that they send down to (through?) you.
 
This is an old thread but still relevant.

Well yes in December 2009 things had really changed in Ireland and Firefly's advice to get to Penney's in November was so right. It's now the shop of choice for some and many by necessity. But certainly it's now full of hoards of people and hard to get to the till on many occasions. Still my favourite shop along with the pound shop (nowadays the 2Euro shop) which are springing up everywhere much to my delight. Lidl and Aldi are often mentioned in conversation as good places to shop whereas before you wouldn't be seen dead there nor boast about the bargains to be had there. Restaurants are descimated in general but not everywhere. There is still plenty of money in Ireland and I see a widening gap between the have's and have not's. Many wealthy people are still very wealthy, they may have lost out millions on property values in leafy Dublin but their spending power has increased. There was no seat to be had in Roly's Bistro when I dined there this year. An upmarket East cost holiday village was theming and full of money, not celtic tiger days but plenty of money all the same, just more carefully spent and more hidden in keeping with the times. The talk now is of emigration, loss of jobs and debt in hushed terms, but becomming more open about it. Talk too of where to put any money if you have some, is it safe in the bank or that credit union and ending with the under the mattress decision. Plenty of talk too about bond markets. Depression, resignation and despair in some quarters and anger too. Strange times indeed.
 
I think I read recently that in a survey Ireland may well be the 2nd highest spenders this Xmas.

If true, does it show there is still plenty of money out there?
 
Great subject this and resurrected from the depths of the forum. Shows some of the people on here really think occasionally. More than one poster suggested that we educate people on how to manage debt along the way. Somebody else suggested that it was the 'under-achievers' were the people who couldn't come to terms with the reality of credit-card spend etc.

When I saw some people going wild during the Celtic Tiger and through false confidence taking financial risks (purchase of high-rise apartments in Bulgaria for example etc; tradesmen becoming self-employed within their apprenticeship also). The stories were good, but the reality was stunningly catastrophic.

We are told by alarmingly high earners on RTE that we should all bear the brunt of this crazy spending as if this will happen. Well, it won't and there will be squeaky bums around for years to come. Many will never recover.

And believe it or not the population is educated now to 3rd Level when even a 6th class primary school student could tell you that something borrowed must be repaid sometime. Good God, are 3rd Level Educators failing us?
 
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