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Even people earning above 75k file for bankruptcy, why do Americans (not all) have a hard time living within their means. Tell us why yo filed for bankruptcy.
Location: Georgia, on the Florida line, right above Tallahassee
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I'll start it off by saying I've never filed for bankruptcy. Buf if I had, I wouldn't mention it here. I'm sure the reasons are myriad, but I'm going to say the majority of people file for bankruptcy because they ran out of money.
I have not filed bankruptcy, but I am sure a job loss would do it. I live the same way most Americans do - pay check to pay check. Other than the fact that I want everything now and have very little discipline for telling myself no, I think the biggest factor to lead me down the path of overspending is the easy money provided by refinancing the houses that started back in the late 90s early 2000. It was just one of those things, everyone else was doing it. It started out refinance to get a lower interest rate, but then it became you can also get money out to pay off credit cards and remodel. And of course the cards were paid but not closed. So I started back using them to get things now or go on expensive vacations. Paying the minimums no big deal. You slowly start charging more. Then all of sudden the banks raise the interest rates, your minimum payments go up and all sudden you are squeezed to just make minimums. Then you start the cycle again, I am going to refinance and pay off the cards...and so the story goes until everything is out of control again. I am not making excuses for my predicament...just explaining how I got into living beyond my means. Ultimately just plain old lack of financial discipline. Just living day to day and not reallying paying attention to where the money goes. The current financial crisis has awakened me from my financial slumber. I am now working to pay off the debt, but changing old habits is hard. I struggle with the temptation to charge and spend every dime daily. Also having friends and relatives who live beyond their means is a powerful influence to overspend. I constantly have folks calling saying hey, let's plan a vacation to go here or there. Or let's go eat at this expensive restaurant. We find it very hard to say "No we have no money and are paying off debt". People look at you like you are crazy and really do not believe you have no money.
People have a hard time living with their means, maybe because their 'means' have CHANGED, but the bills didn't - in fact, the CC companies JACK the bills up - for everyone these days it seems. We went from two incomes to one - due to total loss of business in our small construction company - and construction is not coming back anytime soon. And after 30 years in construction, when you try to go to work for someone else now, you are, well 'older', and so you're in line for jobs with many younger bucks - so anyway, it's been challenging - for over 2 years now. So meanwhile, the credit card bills, that were quite manageable before, go up to 30% interest, late charges, over the limit, etc - so before you know it the balance is JACKED UP!! And, your house is underwater, and you are not eligible for unemployment (because self-employed)..... so, whew! Well, we are now living within our 'means' (at some point you have no choice) but our means won't pay these credit card bills!! LOL It seems 'credit' is really only a valuable tool when you DO NOT need it!! So now, we could either struggle for YEARS to pay these things off (BTW there's no credit report code that says, "late - but great guy worked hard and finally paid it all off" - LOL), or we do BK and start over - and that will take years too, but at least we'll have more money to work with in the meantime. One thing for sure - many are learning to "do the math" more better these days!!
Even people earning above 75k file for bankruptcy, why do Americans (not all) have a hard time living within their means. Tell us why yo filed for bankruptcy.
Lack of education in the finance world. Temptations. No goals.
Why not build a emergency fund and up to 6 months of living expense so if you lose your job, you still have the rainy day fund to fall back on?
What is your reason for living paycheck to paycheck?
If you want everything now then what about later in your golden years? Who knows what will happen tomorrow?
What others do has nothing to do with your lifestyle. You should do whats best for you.
Quote:
Originally Posted by Fritz99
I have not filed bankruptcy, but I am sure a job loss would do it. I live the same way most Americans do - pay check to pay check. Other than the fact that I want everything now and have very little discipline for telling myself no, I think the biggest factor to lead me down the path of overspending is the easy money provided by refinancing the houses that started back in the late 90s early 2000. It was just one of those things, everyone else was doing it. It started out refinance to get a lower interest rate, but then it became you can also get money out to pay off credit cards and remodel. And of course the cards were paid but not closed. So I started back using them to get things now or go on expensive vacations. Paying the minimums no big deal. You slowly start charging more. Then all of sudden the banks raise the interest rates, your minimum payments go up and all sudden you are squeezed to just make minimums. Then you start the cycle again, I am going to refinance and pay off the cards...and so the story goes until everything is out of control again. I am not making excuses for my predicament...just explaining how I got into living beyond my means. Ultimately just plain old lack of financial discipline. Just living day to day and not reallying paying attention to where the money goes. The current financial crisis has awakened me from my financial slumber. I am now working to pay off the debt, but changing old habits is hard. I struggle with the temptation to charge and spend every dime daily. Also having friends and relatives who live beyond their means is a powerful influence to overspend. I constantly have folks calling saying hey, let's plan a vacation to go here or there. Or let's go eat at this expensive restaurant. We find it very hard to say "No we have no money and are paying off debt". People look at you like you are crazy and really do not believe you have no money.
People have a hard time living with their means, maybe because their 'means' have CHANGED, but the bills didn't - in fact, the CC companies JACK the bills up - for everyone these days it seems. We went from two incomes to one - due to total loss of business in our small construction company - and construction is not coming back anytime soon. And after 30 years in construction, when you try to go to work for someone else now, you are, well 'older', and so you're in line for jobs with many younger bucks - so anyway, it's been challenging - for over 2 years now. So meanwhile, the credit card bills, that were quite manageable before, go up to 30% interest, late charges, over the limit, etc - so before you know it the balance is JACKED UP!! And, your house is underwater, and you are not eligible for unemployment (because self-employed)..... so, whew! Well, we are now living within our 'means' (at some point you have no choice) but our means won't pay these credit card bills!! LOL It seems 'credit' is really only a valuable tool when you DO NOT need it!! So now, we could either struggle for YEARS to pay these things off (BTW there's no credit report code that says, "late - but great guy worked hard and finally paid it all off" - LOL), or we do BK and start over - and that will take years too, but at least we'll have more money to work with in the meantime. One thing for sure - many are learning to "do the math" more better these days!!
What is your reason for using a CC and paying interest on it?
It not using the credit card its not using it to your advantage. Its like managing any credit really. Just like buying a house its not possible for most without credit and with poor credit alot more expensive.No credit i dang near impossible for most unless you want a shack.
I'll start it off by saying I've never filed for bankruptcy. Buf if I had, I wouldn't mention it here. I'm sure the reasons are myriad, but I'm going to say the majority of people file for bankruptcy because they ran out of money.
Shocking? Yes. But true.
Yes, that's true. But running out of money is often a symptom of other problems.
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