Ignorance is Scary

[Rustward]

Sometimes lack of basic skills can be scary, too. This is going to sound like I made it up but it is true.

Recent visitors arrived at the house using directions from Mapquest.

Enter town on U.S. Highway. Turn right on the "loop".
Go a couple of miles on the loop and turn right onto the interstate.
Go five miles on the interstate to a major state tollway (like an interstate).
Go five miles on the tollway and exit to two lane county road.
Go one mile on the county road, turn left, and we are the second house.

Pretty easy -- daytime, light traffic, good weather.

Now the plan was to leave here to go to their niece's house elsewhere in town, then go home from there.

Some event caused them to cancel the niece visit and just go home from here.

He was prepping the car as I saw her at the kitchen table shuffling a small stack of mapquest maps and directions while shaking her head from side to side.

I now suspect he knew what was happening and decided to remove himself from it because he is the cause of everything that has ever gone wrong. Once on a cross country road trip they had to stop to replace their six year old battery that failed because he turned on the radio.

I say "What seems to be the problem?"
"I need directions." Me: "?"
"Well, I have directions to here, and I have directions from here to my niece's house, and I have directions from my niece's house to home . . . but I don't have directions from here to home."

I innocently said "Just use the directions and map you used to get here. Why can't you do that?"
"Because all the turns are backwards, uh, and . . . Oh, it just won't work." Another headshake.
I should have taken this seriously but I thought she was joking. "You're kidding, right?"
"No, I'm not kidding".

Three minutes later I handed her the needed Mapquest directions and all was good with the world!

 

[Mulligan]

The [-]stupidity[/-] naivete of so many consumers regarding an item's cost is amazing, frustrating to us LBYM'ers, and when it involves friends/family can be depressing.
I have a couple of friends who make very good incomes, yet barely get by paycheck to paycheck. They often talk about cost of a purchase in terms of X dollars per month vs its actual cost. One of them is thrilled that something was on sale, yet doesn't get it that paying 18% credit card interest isn't exactly a good "sale item."
Like TromboneAl, I stay mum.

Don't worry Mystang, you did the right thing. Two of my best friends are like that and I would preach all the time to them. All it accomplished was them going underground and not bringing the stuff up to me anymore....


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[Choices]

My SIL(62) is a millionaire in Iraqi Dinar.
She went so far as to make an appointment with a financial advisor in preparation for the inevitable revaluation. After informing DW that she would need to borrow some money for airfare to Atlanta in order to buy more dinar, I sent her a few links including one to ebay where she could buy all she wanted at the same price...... crickets.

We must be related! We also have Dinar millionaires in the family. They have been known to call us AT WORK to tell us the revalue was coming in a couple of days and to buy all we could. We still don't own any but somehow will manage to comfortably retire soon.

Then there was the flight lessons in prep to buy a plane and leae it out, two new high end cars, etc all to be pd for with the Dinar proceeds.

I am glad these folks are outlaws and not on my side of the family. They sure don't want to hear about spending less than you make and of course, they do not trust the market. C'est las vie!

 

[papadad111]

I wonder if it's not ignorance, but rather self-delusion. People just want the shiny new car or truck. They know the salesman is deluding them with talk of trade-in values and monthly payments, but they are thankful because he provides a way for them to justify the purchase to themselves and others. They can repeat all the details, sounding sophisticated, without ever having to face the true cost.

Nope. I'm pretty convinced it's just plain ignorance. Stupid is as stupid does.

Want to have some fun? Challenge the cashier by changing the amount of cash tendered after they hit the buttons and the till opens. (Lights dim..smoke out of their ears). Sad but true.

+1. Sadly we will be footing their bill and covering their bad credit some day. Eventually the rooster comes home to roost.

 

[2B]

Most of the stories here is why Dave Ramsey does so well. Most of us here consider his advice / program remedial at best with very negative opinions of his investment statements (12%/yr and the high cost ELPs). Unfortunately, most of the rest of the population are still struggling to understand "Debt is Dumb." This is the basic message of his program with an actual way to get out of debt. I have personally sent many people in the kind of situation described in this thread to his Financial Peace classes.

I've read a couple of his books and occasionally listen to his radio show. I've never taken Financial Peace but the last time I had any debt other than a mortgage was in 1976 when newly wed DW showed me her car note. She watched me write a check to pay it off and I said we don't do car loans. She seemed surprised people didn't all have car notes. Fortunately, DW adapted very well to my tight-fisted approach. Her twin sister hasn't fared so well with a big spending husband. They have had a series of much nicer cars and expensive toys. We have a well (over) funded retirement.

 

[travelover]

..............If you can't afford to maintain what you already own you shouldn't be leasing a new vehicle.

Yea, but lease payments are so.........predictable! How is any person supposed to come up with, like, $1000, just like that?

 

[harley]

Nope. I'm pretty convinced it's just plain ignorance. Stupid is as stupid does.

Just a point. Ignorance is not the same as stupidity. Ignorance is easily cured with education/information. You can't fix stupid. Probably a few of the people in these stories are merely ignorant and would change their behavior if they understood what they were doing to themselves. But I suspect most of them wouldn't.

 

[Mulligan]

Just a point. Ignorance is not the same as stupidity. Ignorance is easily cured with education/information. You can't fix stupid. Probably a few of the people in these stories are merely ignorant and would change their behavior if they understood what they were doing to themselves. But I suspect most of them wouldn't.

That is the position my free wheeling spender friends are in. The eternal struggle of long term goals versus immediate gratification. They recognize the problem and will try in short spurts, but always succumb back to their prior ways.


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[timo2]

I was in a Macy's department store a few years back and overheard two women in their twenties talking about some clothes that were on sale. They spent about 10 minutes trying desperately (and not succeeding) to figure out how much a sweater would cost that was on sale for 15% off the $50 original price. It was one of those funny/sad moments.


-BB

There's an app for that.

 

[timo2]

I wonder if it's not ignorance, but rather self-delusion. People just want the shiny new car or truck. They know the salesman is deluding them with talk of trade-in values and monthly payments, but they are thankful because he provides a way for them to justify the purchase to themselves and others. They can repeat all the details, sounding sophisticated, without ever having to face the true cost.

That's my BIL, self-deluded. All the stories on this thread about buying unnecessary new vehicles applies to him. I get to tease DW about his retirement plan is to come live with us. That always gets a rise out of her!!

 

[Bryan Barnfellow]

Most of the stories here is why Dave Ramsey does so well. Most of us here consider his advice / program remedial at best with very negative opinions of his investment statements (12%/yr and the high cost ELPs). Unfortunately, most of the rest of the population are still struggling to understand "Debt is Dumb." This is the basic message of his program with an actual way to get out of debt. I have personally sent many people in the kind of situation described in this thread to his Financial Peace classes.

I've read a couple of his books and occasionally listen to his radio show. I've never taken Financial Peace but the last time I had any debt other than a mortgage was in 1976 when newly wed DW showed me her car note. She watched me write a check to pay it off and I said we don't do car loans. She seemed surprised people didn't all have car notes. Fortunately, DW adapted very well to my tight-fisted approach. Her twin sister hasn't fared so well with a big spending husband. They have had a series of much nicer cars and expensive toys. We have a well (over) funded retirement.

The good thing about buying a car with a loan is that you can usually get a better price from the salesperson, who figures to make up some profit from initiating the loan for the bank. I used to negotiate the price, making sure to say several times that I needed a good price to keep the monthly payments low. Then, as soon as the bank sent me their coupon book and intro letter, I sent back the first coupon paying off the loan in its entirety. Of course this only works if you pay off the loan!

-BB

 

[Bryan Barnfellow]

As I read our posts, I am drawn to thinking that for a large segment of people, a new car is a (seemingly affordable) symbol of some measure of financial success in life that is readily communicated and understood by most others. So, perhaps the cost of the car includes this bit of ego massage and many people are willing to pay for it (whether they understand what is going on or not).

-BB

 

[calmloki]

I'm very much of the delayed gratification camp and watching the actions of a time payment sibling used to make me crazy. Then I started repeating the mantra; "lots of ways to live a life".

My sib has been to Europe, had many new cars, buys lots of new clothes and all sorts of the latest things. If a new snack food is advertised on tv I can call and find out what her impressions were when she had it last week. I've never been to Europe or had a new car and rarely am swayed to buy an advertised goody. If I wanted those things I could pay cash with no effect on our lifestyle or future. Instead I have a bunch of numbers on a computer screen to look at. woohoo?

She continues to work, but also has a pension that she can count on. I don't think of myself as working, but have no pension (or IRA or Roth). I can count on only me to fund my future and aged self.

Her lifestyle is different than mine and not what I choose, but hey - lots of ways to live a life.

 

[2B]

The good thing about buying a car with a loan is that you can usually get a better price from the salesperson, who figures to make up some profit from initiating the loan for the bank. I used to negotiate the price, making sure to say several times that I needed a good price to keep the monthly payments low. Then, as soon as the bank sent me their coupon book and intro letter, I sent back the first coupon paying off the loan in its entirety. Of course this only works if you pay off the loan!

-BB

I typically get the "credit union price" for the vehicle. It's a standard $X over dealer invoice. Financing is totally separate. Many vehicles ago I would shop other dealers and negotiate aggressively using various approaches. I could never beat the original offer. No loan involved.

 

[38Chevy454]

I was in a Macy's department store a few years back and overheard two women in their twenties talking about some clothes that were on sale. They spent about 10 minutes trying desperately (and not succeeding) to figure out how much a sweater would cost that was on sale for 15% off the $50 original price. It was one of those funny/sad moments.


-BB

That's because 5 out of 4 people have trouble with fractions!

Back to OP, it is pretty amazing how ignorant people are about basic financial matters. I work with many highly educated (BS, MS, PhD) people and it blows me away how they do not have any knowledge of personal finance. I do think they are also caught up in "keeping up with the Jones's" mindset.

 

[Major Tom]

Her lifestyle is different than mine and not what I choose, but hey - lots of ways to live a life.

I think this is a good way to look at it. Any time I feel myself beginning to get a little to happy with myself for my Scrooge-like ways, I remind myself of the same thing too.

With my self-imposed low income, there is not much room for a lot of discretionary spending, though enough to keep my particular personality type content. I have a great friend who just cannot hold on to money - it slips through his hands like water. However, he never, ever blames others for the scrapes he gets himself into, as he knows it is self-inflicted. He's a lovely human being, and much-loved wherever he goes. My take is that I am more than happy for others to live their lives the way they want, as long as they take full responsibility for themselves. The moment they begin to blame others/society etc, or claim that "it isn't their fault", I tune out.

 

[MRG]

As I read our posts, I am drawn to thinking that for a large segment of people, a new car is a (seemingly affordable) symbol of some measure of financial success in life that is readily communicated and understood by most others. So, perhaps the cost of the car includes this bit of ego massage and many people are willing to pay for it (whether they understand what is going on or not).

-BB

+1
If it looks good to the outside world "I" must be doing well. Always seemed to me the more expensive the car was, the more insecure and unhappy the owner was.

Excluding the folks that can afford it and have a genuine passion for cars.

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[Dash man]

+1
If it looks good to the outside world "I" must be doing well. Always seemed to me the more expensive the car was, the more insecure and unhappy the owner was.

Excluding the folks that can afford it and have a genuine passion for cars.

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The key words "can afford it." There's a wide difference among my family in what that means. My SIL recently traded in her almost paid off SUV for a new one that the dealer convinced her she could afford. The monthly payments are lower...forget the detail that she is now on the hook for four additional years.


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[Amethyst]

Beyond the natural desire for comfort and variety, I suspect a lot comes down to whether your self-esteem comes from within, or is mainly a reflection of others' admiration. If you were vulnerable to peer pressure as a kid, you probably don't want to be considered self-depriving or frugal as an adult.

Amethyst

That is the position my free wheeling spender friends are in. The eternal struggle of long term goals versus immediate gratification. They recognize the problem and will try in short spurts, but always succumb back to their prior ways.


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[jon-nyc]

However, he never, ever blames others for the scrapes he gets himself into, as he knows it is self-inflicted.

That's great, and contrary to the experience I have with the spendy types in my life. For them the pattern is:

bad decision
bad decision
bad decision
bad luck

"Hey - I'm in a world of hurt due to this bad luck I had! Someone help me out of this jamb."

 

[unclemick]

Me, too! Now if I could just get rid of parasitic relatives, I'd be all set.

I have a certain relative with a plaque on the wall -'He who dies with the most toys-WINS!'

What it doesn't say is most of the toys are bought on credit and other relatives over the decades have bailed him out from time to time.

heh heh heh - I have met many people with a phobia toward money and a total (IMHO) refusal to learn the rules of the road as to credit.

 

[Cobra9777]

I wonder if there are big truck forums where members make fun of their retired neighbor who drives a 1999 Camry and actually paid a mechanic to replace the fuel pump?

 

[travelover]

I wonder if there are big truck forums where members make fun of their retired neighbor who drives a 1999 Camry and actually paid a mechanic to replace the fuel pump?

Absolutely. They even have kits to make diesels deliberately spew out soot onto less than macho vehicles like Prius and others.

 

[Amethyst]

I remember when we had our house built. The saleswoman said they had run our credit scores, looked at our income and "You can afford more house." Trying to get us to go for a more expensive model - as if the one we'd selected wasn't big enough already.

Amethyst

 

[Jack_Pine]

I wonder if there are big truck forums where members make fun of their retired neighbor who drives a 1999 Camry and actually paid a mechanic to replace the fuel pump?

Actually I have a big truck and am on those forums, thank you very much. I sue it to pull a 30' travel trailer. All paid for.

Mine does not spew smoke but have done a few mods to it.