Poor people and credit

[zygalski]

King Herald said:

Poor people or rich people, nearly all of us buy our houses on credit.

How many watches double or even triple their value in 20 years?

[DonkeyApple]

zygalski said:

King Herald said:

Poor people or rich people, nearly all of us buy our houses on credit.

How many watches double or even triple their value in 20 years?

Forget about the value. A roof over our heads is a necessity. But excess leverage still plays a part in whether we buy what we can afford or yet again use tomorrow's money to buy something more expensive.

Debt in itself is not bad. In fact, debt is very good. It is excess debt which is bad. In terms of consumer spending, debt which is financed out of excess capital after all liabilities are accounted for is not an issue. The problem is debt that has to be financed out of income ahead of liabilities being met.

The core example being that we all must invest a significant percentage of current income in order to maintain our current standard of living once we stop being paid a working income. What we know from looking at spending and saving data is that the average Briton is using the money they need to be saving to create an income once they are no longer employed to actually finance debt today due to massive over spending. They have decided that they will surrender any quality retirement in order to live a bigger life now. That either means they are terminally ill or terminally foolish. For most it is the latter.

However, if after you have taken care of all your financial responsibilities and each month you are left with excess capital then there is absolutely nothing wrong with using that money to buy sweets, holidays, toys or finance a controlled level of debt that permits you to consume even more. Bit even then it must be a measured act as long term liabilities expose you to risk of fluctuating incomes.

Long and short is that the problem in the UK isn't debt but excess debt.

[johnwilliams77]

zygalski said:

How many watches double or even triple their value in 20 years?

I was checking 'bought prcie' on zoopla recently. A few around me were bought in 2004 for 130-140k now valued at 350k.

[iphonedyou]

zygalski said:

How many watches double or even triple their value in 20 years?

Makes less sense to think like that when you assume, ceteris paribus, that all the other watches are doubling or even tripling in value across those 20 years.

[Pommygranite]

zygalski said:

King Herald said:

Poor people or rich people, nearly all of us buy our houses on credit.

How many watches double or even triple their value in 20 years?

So I take it everything you own and have owned apart from your house has been bought cleanly, outright, cash only or no debt or interest applied?

[zygalski]

Pommygranite said:

zygalski said:

King Herald said:

Poor people or rich people, nearly all of us buy our houses on credit.

How many watches double or even triple their value in 20 years?

So I take it everything you own and have owned apart from your house has been bought cleanly, outright, cash only or no debt or interest applied?

I had a £5k car loan about 15 years ago that I paid off a year early. Apart from the house, you're right.
If I can't afford it, it doesn't get bought.

[CorbynForTheBin]

Interesting, the need to state the loan was repaid early.

[zygalski]

CorbynForTheBin said:

Interesting, the need to state the loan was repaid early.

Apart from a mortgage, I'm not keen on debt. Well spotted.

[Pommygranite]

zygalski said:

Pommygranite said:

zygalski said:

King Herald said:

Poor people or rich people, nearly all of us buy our houses on credit.

How many watches double or even triple their value in 20 years?

So I take it everything you own and have owned apart from your house has been bought cleanly, outright, cash only or no debt or interest applied?

I had a £5k car loan about 15 years ago that I paid off a year early. Apart from the house, you're right.
If I can't afford it, it doesn't get bought.

Not a fan of having new stuff hey?

But there's a difference between cant afford something outright and can't afford the repayments non?

[zygalski]

Pommygranite said:

zygalski said:

Pommygranite said:

zygalski said:

King Herald said:

Poor people or rich people, nearly all of us buy our houses on credit.

How many watches double or even triple their value in 20 years?

So I take it everything you own and have owned apart from your house has been bought cleanly, outright, cash only or no debt or interest applied?

I had a £5k car loan about 15 years ago that I paid off a year early. Apart from the house, you're right.
If I can't afford it, it doesn't get bought.

Not a fan of having new stuff hey?

But there's a difference between cant afford something outright and can't afford the repayments non?

Of course, each to their own etc etc. But seriously... trinkets, jewelry... on credit. Materialism gone mad.

[DonkeyApple]

Pommygranite said:

Not a fan of having new stuff hey?

But there's a difference between cant afford something outright and can't afford the repayments non?

Not in reality. The latter just kicks the issue further down the road. This isn't a problem for the poorest people in Britain as it has no impact on their lifestyle cradle to grave, arguably it improves their middle life period. But it has enormous ramifications for those who are above the breadline as they will discover when they are 65, unemployed, with insufficient savings to generate an income great enough to maintain a suitable lifestyle.

That urine soaked wingback and shouty foreign carer of the discount council care home awaits the majority of today's Gay Disco participants

[burritoNinja]

I just had a look at that Bright House place.A poverty spec iMac retails at £1,200 and with paying that company £21.50 per week for 104 weeks, well you could have bought two of the damn iMac's. A person would have to be insane to do that.

[Pommygranite]

zygalski said:

Pommygranite said:

zygalski said:

Pommygranite said:

zygalski said:

King Herald said:

Poor people or rich people, nearly all of us buy our houses on credit.

How many watches double or even triple their value in 20 years?

So I take it everything you own and have owned apart from your house has been bought cleanly, outright, cash only or no debt or interest applied?

I had a £5k car loan about 15 years ago that I paid off a year early. Apart from the house, you're right.
If I can't afford it, it doesn't get bought.

Not a fan of having new stuff hey?

But there's a difference between cant afford something outright and can't afford the repayments non?

Of course, each to their own etc etc. But seriously... trinkets, jewelry... on credit. Materialism gone mad.

I don't necessarily disagree but I also think that some people have a passion and are prepared to pay for it - whether it's a watch, a car, a steam engine, hiking, painting whatever.

It's a bit closed mind to judge another's purchases as poor because you don't understand it.

I've bought plenty of things on credit, some worth it, some not, but ultimately its not changed my life negatively by using credit just as it's not changed my life to the same level positively for having the stuff.

If I hadnt had credit I would have just saved up and bought the same thing but waited longer and again, ultimately, I was just prepared to pay more to get it sooner. Am unsure what's the problem with that.

[Pommygranite]

DonkeyApple said:

Pommygranite said:

Not a fan of having new stuff hey?

But there's a difference between cant afford something outright and can't afford the repayments non?

Not in reality. The latter just kicks the issue further down the road. This isn't a problem for the poorest people in Britain as it has no impact on their lifestyle cradle to grave, arguably it improves their middle life period. But it has enormous ramifications for those who are above the breadline as they will discover when they are 65, unemployed, with insufficient savings to generate an income great enough to maintain a suitable lifestyle.

That urine soaked wingback and shouty foreign carer of the discount council care home awaits the majority of today's Gay Disco participants

So let's say you're 30, do you spend 30 years saving your lifestyle money so that you can have a less stressful last 20 years?

It's an emotional led thought.

[johnwilliams77]

Pommygranite said:

So let's say you're 30, do you spend 30 years saving your lifestyle money so that you can have a less stressful last 20 years?

It's an emotional led thought.

Strike a balance

[Pommygranite]

johnwilliams77 said:

Pommygranite said:

So let's say you're 30, do you spend 30 years saving your lifestyle money so that you can have a less stressful last 20 years?

It's an emotional led thought.

Strike a balance

Completely agree.

It is a singular arguement for some - 'don't get credit as it costs more and that's money you can save to have more money to buy things I dont think you should buy in the first place'.

[DonkeyApple]

Pommygranite said:

DonkeyApple said:

Pommygranite said:

Not a fan of having new stuff hey?

But there's a difference between cant afford something outright and can't afford the repayments non?

Not in reality. The latter just kicks the issue further down the road. This isn't a problem for the poorest people in Britain as it has no impact on their lifestyle cradle to grave, arguably it improves their middle life period. But it has enormous ramifications for those who are above the breadline as they will discover when they are 65, unemployed, with insufficient savings to generate an income great enough to maintain a suitable lifestyle.

That urine soaked wingback and shouty foreign carer of the discount council care home awaits the majority of today's Gay Disco participants

So let's say you're 30, do you spend 30 years saving your lifestyle money so that you can have a less stressful last 20 years?

It's an emotional led thought.

The majority are simply not aware that they are making that life choice. It's the very nature of us humans that many don't naturally anticipate the impact of their actions today on their life tomorrow.

It is because of human natures such as this and our inability in many cases to control spending etc that all societies from the dawn of civilisation have had some form of regulation regarding usuary. Whether it be punishment by death, fear of damnation or legal restrictions all societies have had such governance. And it hasn't been done to stop 24 party people from having fun. . As a collective we are a bit cr4p at self regulation. And it is absolutely no connection-incidence that increases in retail debt consumption have flowed perfectly with the removal of regulation on lending by politicians. They are, after all the majority of the 'few' who will gain directly and prosper from the people's over spending etc.

The key though is that it is good to talk about consumer debt and discuss its ramifications and to ask why some people seem happy to spend every bit of their income in financing debt while others will spend absolutely none of their income financing debt because debt is a hugely important part of modern society and so few people genuinely understand how it works and the true risks or how to use it prudently.

[DonkeyApple]

burritoNinja said:

I just had a look at that Bright House place.A poverty spec iMac retails at £1,200 and with paying that company £21.50 per week for 104 weeks, well you could have bought two of the damn iMac's. A person would have to be insane to do that.

I don't think insanity comes into it. It is a combination of someone being terrible with money combined with it having no detrimental impact on their existing lifestyle once living at the level in society.

People point and mock Wonga and Brighthouse type products but the real fools are elsewhere in society as shown by who had to be bailed out in 2008 and who will be being bankrupted when interest rates rise eventually along with those who stand no chance of financing their own retirement. The fools are all amongst us but they aren't the cattle being milked of their benefit income by wonghouse.