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Because the poster he was responding to posted that earlier without any details.
Context my friend, context.
That poster explained what he meant when I questioned him.
If you follow back in the thread, the context was clear. Everything was quoted in order and the details were provided. Reading comprehension goes a long way.
Again, it is up to the EMPLOYER to provide the phone if it is necessary to the job, not expect an employee to use their own personal phones. I worked for a steel company for 16 years - the outside salesmen and delivery fleet drivers all carried cell phones when they were on the road. The COMPANY provided and paid for them, and also owned, insured and maintained the cars for the outside salesmen to use when they visited customers.
Good for them. That’s perfectly reasonable under those circumstances. But I’m not talking about people who deliver physical stuff for a living, when I say *I* won’t hire someone who doesn’t have a smartphone and an internet connection. Our business consists of delivering live content to the internet. If you don’t already have both those things you aren’t living in the same world as 100% of our end users. Besides the requirements I’ve already listed. And I’m not supplying cell phones and internet plans to our team or our independent contractors. They already have them, and they can deduct their business use as a job expense.
Having a phone and internet connection are not luxuries, and are the last things you should get rid of if you’re overextended. There are a gazillion ways of earning extra cash - the majority of which require an internet connection and a smartphone.
If you're responsible, you should be living on credit. It's free money for you.
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What a load. It's not "free money," you do have to pay it back, and smart people pay up before the interest kicks in. I make sure my Discover bill get paid every month, so even though I have a revolving balance the charges get wiped off before they start accumulating interest. My FICO is currently 806, that speaks for itself.
The American middle class is falling deeper into debt to maintain a middle-class lifestyle
Cars, college, houses and medical care have become steadily more costly, but incomes have been largely stagnant for two decades, despite a recent uptick. Filling the gap between earning and spending is an explosion of finance into nearly every corner of the consumer economy.
Consumer debt, not counting mortgages, has climbed to $4 trillion—higher than it has ever been even after adjusting for inflation.
I concur, but all of his posts are like that. We do not have a wage, inflation, nor COL problem. We have a decision making, and choices problem with many. They CHOOSE to be frivolous with their spending, and do not have the discipline like you to say, "I can't afford that right now".
I agree with most of your post, but COL is a problem in some large locales. Just renting a 1 bedroom apartment in many areas of the Bay Area is north of $2K per month. That is a huge chunk of money to dump on rent. Then you include food, utilities, transportation (whether it's a car loan or public transit) there isn't much leftover for many people to save.
It surprises me that people overlook this. It's a guaranteed 2-5% instant gain.
I always use my credit cards to pay my utility bills, groceries, gas and other monthly expenses. It's money I will have to pay out regardless so might as well get a percentage back.
With most cards that have cash back/travel perks the only drawback is they tend to have higher APRs but if you are like me and other responsible folks (I assume you are) just don't have a revolving balance and those cards will pay you back.
As long as plenty of individuals and businesses continue to have the ability to pay off their debt, that should work out good for the economy.
IMO, these historic low interest rates continue to place a band aid on what I call a smoke and mirrors economy. Should interest rates be at 70's and 80's levels? No. But to keep rates this low to push spending/corporate investments can only go so far.
Maybe now the party that abandoned its principles, including the one about fiscal responsibility, will start to understand why you should'nt max out your leverage and throw bricks in glass houses.
There are two types of credit users: people who REPLACE their out of pocket spending with credit, and people who SUPPLEMENT their out of pocket spending with credit.
The former pays their bill in full every month. They budget and stuck to it. Their credit utilization rate is under 10%, 5% if they're really responsible. They do not pay late fees or interest charges. They need $100s every year from cashbacks and rewards just from paying their bill on time.
The latter are the bad credit users. They don't budget. Their credit utilization is more than 20%. They are in debt. They "live beyond their means" bc they can't pay their full balance off at the end of the cycle.
I repped this post, because remarkably, we agree on something.
Per this post and the OP, every single example in the OP article is a BAD credit user. Coup;e 1 has $7500 on a store credit card, and $42,500 in other CC debt? Store cards are like 24-29% APR...the worst revolving debt in the game. Just awful credit users.
The second couple over-bought on student loans and now want to overbuy on housing in a specific market, and if they are successful, they'll be the prototype example of stretching their personal margin to its absolute limit, living paycheck to paycheck and one bad week away from insolvency. And they are saving money to make that ridiculously bad plan a reality. They are actually lamenting that they have not been able to get themselves stretched even thinner than they currently are.
Couple 3 needs no explanation. They took a 30% paycut and THEN chose to finance $48k in auto debt. They set themselves up for all manner of epic fail, and oh look, a domino fell....
Every single person in that article is your definition of bad credit users, who all suffer from the same problem - they want a thing now that they cannot afford, so they borrow against and thus overburden their future selves, and kick their financial cans down the road in the name of whistling a happy "keep up with the Joneses" tune in the meantime. And then the future becomes the present...and uh oh, we ran out of road to kick that can...
If there is a reflection on the economy to be gleaned from their behaviors, it is that our economy is unforgiving and not just a little bit harsh to people with sustained patterns of bad financial and economic behavior. No doubt. But a more openly capitalist system will punish the weak/slow more so than a more closed socialist system will.
And for EXACTLY the reason you cite in another post - if you want an economy that hums along with growth, velocity of currency, flipping inventories, etc...well, that economy will provide greater rewards to the good actors and harsher punishments for the bad actors, and yeah, the effects can snowball in either direction. You are ABSOLUTELY RIGHT that you cannot have both the safe, bunkered down savings economy of thrift that also has robust growth, velocity, consumerism, etc. But bad actors being punished more harshly for acting badly in such an economy does not make the economy itself a bad thing, it simply reveals the inherently unforgiving nature of a functional game where some players win and some lose.
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