"America's Money"

[Milton]

"Everyday folks tell their stories about hard economic times": America's Money: In their own words - Michael Landis: A second job to pay the bills (1) - CNNMoney.com

I don't mean to be judgmental, but many of these people seem to be blaming their circumstances on everyone but themselves. And there seems to be a distinct lack of shame on the part of those who have declared bankruptcy.

I don't have much sympathy for all the complaints about the purported high cost of gas either. Gasoline prices may have increased somewhat, but they are still much, much less than in Europe. Replace the ridiculous gas guzzlers with sensible cars: problem solved.

We do well compared to some people out there, but like most we carry $17,000 in credit-card debt and don't have much in savings

Yikes!

 

[Razor]

There should be Credit card safety courses required and a license to carry a credit card just like to carry a gun. It's like taking out a high interest $17,000 loan to buy all the crap they think they need. 11 mpg? I have a mental picture of his truck, too. Absolutely no sympathy for these people.

 

[BunsGettingFirm]

Not all of them are slackers. Some of the people profiled just had really bad luck. I think we should all get off our high horses once in a while and realize that a hospital stay, a divorce, or a hurricane can easily upset even the most well-laid financial plan.

In particular, I think I'm already in love with miss Denise Janus: 25, mechanical engineer, smart about finances, hard working, nice smile, no husband and no kids. Wow, we may even have gone to the same school so that I can claim some alumni connection.

 

[Patrick]

Not all of them are slackers. In particular, I think I'm already in love with miss Denise Janus: 25, mechanical engineer, smart about finances, nice smile, no husband and no kids. Wow, we may even have gone to the same school so that I can claim some alumni connection.

I'm not so sure about the "smart about finances" part:

"I just bought a house and a full-size truck in Michigan, where I plan to stay rooted. (Gas for my truck is at least $300 a month which doesn't make me want to run out and buy a tiny car.)"

 

[Milton]

I'm not so sure about the "smart about finances" part:

"I just bought a house and a full-size truck in Michigan, where I plan to stay rooted. (Gas for my truck is at least $300 a month which doesn't make me want to run out and buy a tiny car.)"

Yeah, I had the same thought. What was her point: "My financial situation is fantastic (and I can afford to waste cash on a stupid truck)"?

 

[Calgary_Girl]

I'm not so sure about the "smart about finances" part:

"I just bought a house and a full-size truck in Michigan, where I plan to stay rooted. (Gas for my truck is at least $300 a month which doesn't make me want to run out and buy a tiny car.)"

I saw that quote too. Doesn't sound too smart to me at all . I couldn't tell if she was being sarcastic or not....

 

[BunsGettingFirm]

I'm not so sure about the "smart about finances" part:

"I just bought a house and a full-size truck in Michigan, where I plan to stay rooted. (Gas for my truck is at least $300 a month which doesn't make me want to run out and buy a tiny car.)"

OK, not that part, but the smile makes up for it. Of course, nothing escapes the super financial wizards on this forum.

 

[unclemick]

Hmmm - much cuter than grumpy old Harv back in the 70's gas crunch - you get some cheap old Detroit Iron and pay for the gas vs pay thru the nose for a new high mileage ity bity vehicle.

Denise is a lot cuter than the old mfg engineers I worked with in Denver.

My big ass V8 1961 Pontiac Bonneville($150 in 1970) wasn't great on mileage back then either.

heh heh heh - betcha the truck looks good too! .

 

[FUEGO]

Sabrina and Tim Smith, the couple with $17,000 in credit card debt and an $800/month gasoline expense, are in luck, and they don't even know it! Mr. Smith happens to have a few ounces of gold in the form of a chain around his neck. With the recent runup in gold prices, he might be able to clear a a thousand or two for his gold necklace down at the pawn shop.

Seriously, he probably drives a big honkin work truck that gets 11 mpg. Maybe he should find a lower paying job closer to home?? Or find an employer that provides a work truck? Or get a $2000 used honda civic and commute to/from work in that.

 

[Sarah in SC]

Buns, take this advice seriously: do not let these guys "vet" your dates! They are all about the spreadsheet and don't even see the smile!

 

[Hamlet]

How about this one:

Monica Tibbits: Struggling on $40K

"My monthly student loan payments are $1,630 a month. I bring home roughly $2,200 a month from my job. That leaves me $5 short of paying for my incredibly cheap rent of $575 a month. That does not leave any money for food or utilities."

How much could she have borrowed for college? That payment is quite a bit more than my mortgage. She must owe $150k+.

Someone needs to sit the youth of America down and show them that borrowing that much for college to get a degree that only puts you at $40k is a pretty foolish economic choice.

My parents didn't give me much money for college either (my grandpa gave me about $200/month though). I went to the University of Minnesota while I worked about 25 hours a week. It took me 5 years instead of 4, but I graduated without debt.

 

[dex]

How about this one:

How much could she have borrowed for college? That payment is quite a bit more than my mortgage. She must owe $150k+.

Someone needs to sit the youth of America down and show them that borrowing that much for college to get a degree that only puts you at $40k is a pretty foolish economic choice.
.

I think you got it right. Kids just think they should go to college no matter what it costs and then get a job. They don't ask how much does the career pay once I get out of college.

I never had debt - except for a couple of mortgages. That is why I can't believe the amount of debt people have. If I had debt when working I wouldn't have spent money on anything untile I paid it off.

 

[DblDoc]

I think you got it right. Kids just think they should go to college no matter what it costs and then get a job. They don't ask how much does the career pay once I get out of college.

I never had debt - except for a couple of mortgages. That is why I can't believe the amount of debt people have. If I had debt when working I wouldn't have spent money on anything untile I paid it off.

I've seen some stuff about the student loan business that sounds like it has gotten as [-]slimy [/-] creative as the home mortgage business in its prime.

DD

 

[maddythebeagle]

err...yeah, most people would be better off with a professional degree from a state school vs. a liberal arts degree from a private school...even state schools have gone up with state budget problems....as far as a gas prices, I suspect if people cut a few restaurant meals out of their budgets every week, they could find enough savings...

 

[dex]

Not to change the focus of the thread ... but the increases of college costs have outpaced the general inflation rate for years ---- Why no congressional investigation?

 

[kombat]

I think we should all get off our high horses once in a while and realize that a hospital stay, a divorce, or a hurricane can easily upset even the most well-laid financial plan.

Which one of the people profiled had a hospital stay, divorce, or hurricane? All the ones I read were simply people who failed to plan properly, and are now reaping what they've sown.

EDIT: Aha! I posted too fast. Apparently #10 had a divorce and (of course) bankruptcy.

 

[lucija]

kombat - take a look at #22. She had some bad luck. I do not think she did anything irresponsible (although, one has to wonder where the father is).

 

[UncleHoney]

Which one of the people profiled had a hospital stay, divorce, or hurricane? All the ones I read were simply people who failed to plan properly, and are now reaping what they've sown.

EDIT: Aha! I posted too fast. Apparently #10 had a divorce and (of course) bankruptcy.

I'm with you kombat, in most of the stories life just happened to the people and there doesn't seem to be any kind of backup plan, let alone any initial plan.

Most people are blinded to the fact that their actions will result in an equal but opposite reaction. But given the fact that all of us start as rank amateurs managing our lives and money it's a wonder as many survive as do.

I don't know what it is about the human psyche that doesn't perceive risk in things we do. Most people seem to get by, but some get caught in the quicksand and then the really irrational behavior starts, making one bad decision after another.

Everything is all right, as long as everything is all right. The mantra of the common man.

 

[tryan]

Monica Tibbits: Struggling on $40K

"My monthly student loan payments are $1,630 a month. I bring home roughly $2,200 a month from my job. That leaves me $5 short of paying for my incredibly cheap rent of $575 a month. That does not leave any money for food or utilities."

How much could she have borrowed for college? That payment is quite a bit more than my mortgage. She must owe $150k+.

Someone needs to sit the youth of America down and show them that borrowing that much for college to get a degree that only puts you at $40k is a pretty foolish economic choice.

Yeah, at the risk of repeating myself ... 4 out of 5 multi-millionaires I know have NO college. Just alot of kaunas, persistence and determination ... and are good with thier hands (construction mainly) and have good $$ management skills. None of this is taught in college. All learned in the school of hard-knocks.

Graduating with 6 figures of debt for a 5 figure job is shooting yourself in the foot.

 

[FUEGO]

How about this one:

Monica Tibbits: Struggling on $40K

"My monthly student loan payments are $1,630 a month. I bring home roughly $2,200 a month from my job. That leaves me $5 short of paying for my incredibly cheap rent of $575 a month. That does not leave any money for food or utilities."

How much could she have borrowed for college? That payment is quite a bit more than my mortgage. She must owe $150k+.

Someone needs to sit the youth of America down and show them that borrowing that much for college to get a degree that only puts you at $40k is a pretty foolish economic choice.

My parents didn't give me much money for college either (my grandpa gave me about $200/month though). I went to the University of Minnesota while I worked about 25 hours a week. It took me 5 years instead of 4, but I graduated without debt.

I find it mind-boggling that she spent all that money on an expensive school, when far less expensive alternatives were probably available, continues to live in a high cost of living city (Boston, IIRC) and makes the same salary as a planner that you could make practically everywhere else (as least in my low COLA area).

I guest lecture a few times a year at one of the top-ranked urban planning grad programs in the nation, and tuition there is very affordable while the quality of students is very impressive. Affordable tuition is a must when your probable career path has you starting out making $35-40k in a typical position. I overheard the students one day talking about where they were also admitted besides State U, and of course all the name brand east coast schools were named, but most folks were commenting on how crazy it would be to pay 3x the price just to make the same starting salary right out of the gate. The financials just didn't make sense.

It really is amazing how much some folks will pay to go to an expensive college, yet are unable to capitalize on any of the expenditure (in many cases).

 

[sarahsays]

It really is amazing how much some folks will pay to go to an expensive college, yet are unable to capitalize on any of the expenditure (in many cases).

That's my sister in a nutshell. She's an acting major at a private university (upwards of 40k a year). Acting! Yes, she might be one of the lucky few who make it on Broadway or in Hollywood, but the odds are stacked strongly against her.

My parents gave us money for college and she could've gone to a state school (like I did) and graduated debt free, but instead she's graduating with tens of thousands in student loans. It makes me very worried for her future (or my parents' future, as my sister might be on their couch forever!)

 

[Milton]

I do not think she did anything irresponsible.

It seems pretty clear - from all her talk about needing to refinance - that she purchased a house that was well beyond her means.

One has to wonder where the father is.

Indeed.

 

[lucija]

It seems pretty clear - from all her talk about needing to refinance - that she purchased a house that was well beyond her means.

Well... I tried to keep an open mind on this one. We do not know terms of her loan and her motivations. Apparently, she was able and willing to do a refinance before the free-fall, but was advised to wait for better rates. In retrospect, big mistake.

 

[Milton]

Take a look at this one: America's Money: In their own words - Shannon McCauley: Burned by fuel costs (44) - CNNMoney.com.

In a nutshell: 20-something couple operates a low-end snack shop that is losing money. Their response is to obtain and max-out new credit cards.

Not only does the closing sentence ("The answer is obvious: CUT FUEL COSTS NOW") come as a complete non sequitur, but she doesn't identify who she expects to implement the desired cut. Presumably the feds are supposed to step in and force OPEC (at the point of a gun) to lower the price of crude.

 

[kombat]

The thing that gets me about most of these stories is how very few of them actually have anything to do with anything particular about the current state of the economy. It seems that even if the economy were humming along normally, these people would still be in the situations they're in. People lose their jobs all the time, in good economies and bad. They learn to be better prepared for it next time. People find fuel and food getting more expensive all the time too. It's called "inflation," and it's not unique to a credit crunch.

It almost seems as though these people are just using the fact that the economy has slowed as an excuse to complain about their lives that were already stretched to their financial limits, even in good times.