Why aren't people more financially responsible?

[800who]

I never knew it growing up because my parents were good at hiding it, but they weren't the most responsible financially. In high school I took a class about personal finance and it was very basic, but somehow it got me into being financially responsible and credit etc. Now credit is almost a hobby for me. I am 19 now with a top tier credit score and I got my first credit card a month after I turned 18 and I rememeber talking to my dad about it as I was coming up on my 18th birthday and he was almost angry/dissapointed when I mentioned that I wanted to get a credit card and I was confused, today I understand why because my parents had terrible financial habits and my siblings who are significantly older than me made bad financial decisions when they first turned 18 and my dad had to suffer through it and fix it. I knew personally that I was more than capable of having a credit card. I've been working at a credit union for about a year now, and it's so weird seeing all these people that just barely scraping by... which is more expected however, I see way too many people treat credit cards as "extra" money and the crazy high balances people have and then watching them make that minimum payment every month has me so confused. The highest credit card balance I've seen personally is like $45k with a 800 or so minimum payment and I guess what I'm getting at is why is this so common. Thoughts and opinions on this?

[egghead88]

Wow... there are like thousands of answers to your question and I’m happy that you’ve learn at a early age financial responsibility. The simplest answer I can give you is.. life happens. As you experience the up and downs that life hands you, stand firmly in financial beliefs. Good luck!

[Anonymous]

Good for you staying in check!!!

A lot of people are financially responsible, however there are still many that are not.

I blame our society, advertising and marketing.

The ooolala's that get people excited. 

spend away. 

borrow more

up to your eyeballs and then some.

Yes everyone will have a different opinion, and those that are not responsible, will have a different reason.

edit to add:  I am a retailer and get to swipe many cards each day, 

and I have seen many declined due to insufficient funds/over limit.

Better luck next time?

[iced]

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@Anonymous wrote:

Good for you staying in check!!!

A lot of people are financially responsible, however there are still many that are not.

I blame our society, advertising and marketing.

The ooolala's that get people excited. 

spend away. 

borrow more

up to your eyeballs and then some.

Yes everyone will have a different opinion, and those that are not responsible, will have a different reason.

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You had me all the way up to the last sentence above, the last word even. I would substitute "reason" for "excuse", and then we're in total agreement. I'll add to this, though in my own sugar-coated style.

Many people are selfish, lacking in self control, and terribly gullible. Marketers use psychology to convince you that by buying their stuff, you too can live like the affluent and be the envy of your friends (spoiler alert: you aren't and you won't be). Don't worry about how you're going to pay for it, what matters is the feels! Even entire cultural traditions (xmas presents, engagement rings, etc) are the direct result of successful marketing convincing the mindless masses they need to part with their money or face ostracism and judgement from their peers.

By many, I mean most. 40% of Americans can't cover a $400 emergency expense from savings. 25% have $0 in savings. 51% are making no contributions to a retirement plan at all (even with a pension, which is rare these days, one should be saving something). Any way you slice it, at least half this country is unprepared for their future and/or aren't even trying to prepare. I bet most of those same people have newer smartphones, TVs, designer clothing, and possibly even a nice car or two, though.

Perhaps as irritating, many people also lack an awareness of the effects their actions have on others or themselves in the future. When someone buys something they can't afford and uses YOLO or "I can't take it with me" as justification, they just failed the awareness test. **bleep** the consequences to them in one year, or twenty - they just want gratification NOW. They might be dead in 20 years and can't spend it then, sure, but they're just as likely to be alive in 20 years and be a burden on those around them because they didn't save enough to support themselves...or counted on some social net like Social Security to save them only to find it falls short of their needs or is gone altogether.

Side note: apparently, **bleep** is a swear word around here. It's like 1980 all over again. Shucky-darn, er, I mean... **bleep**.

[CGeorge]

Yes, I have a step-daughter - and when she is able to get a credit card (rarely) - she immediately runs it up to the limit.

I would love to tell her: "That credit is just burning a whole in your pocket...!"

I personally despise owing any money. You have to learn that the credit card balances have to be PAID - it isn't free money!

Good for you!

[Anonymous]

You never know what people are going through so don't automatically assume (really judge) that just because people are scraping by it's because they aren't financially responsible. As another person said "life happens" which I am sure as you get older you will find out for yourself.

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@800who wrote:

I never knew it growing up because my parents were good at hiding it, but they weren't the most responsible financially. In high school I took a class about personal finance and it was very basic, but somehow it got me into being financially responsible and credit etc. Now credit is almost a hobby for me. I am 19 now with a top tier credit score and I got my first credit card a month after I turned 18 and I rememeber talking to my dad about it as I was coming up on my 18th birthday and he was almost angry/dissapointed when I mentioned that I wanted to get a credit card and I was confused, today I understand why because my parents had terrible financial habits and my siblings who are significantly older than me made bad financial decisions when they first turned 18 and my dad had to suffer through it and fix it. I knew personally that I was more than capable of having a credit card. I've been working at a credit union for about a year now, and it's so weird seeing all these people that just barely scraping by... which is more expected however, I see way too many people treat credit cards as "extra" money and the crazy high balances people have and then watching them make that minimum payment every month has me so confused. The highest credit card balance I've seen personally is like $45k with a 800 or so minimum payment and I guess what I'm getting at is why is this so common. Thoughts and opinions on this?

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[Anonymous]

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@iced wrote:

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@Anonymous

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You had me all the way up to the last sentence above, the last word even. I would substitute "reason" for "excuse", and then we're in total agreement. I'll add to this, though in my own sugar-coated style.

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YOU SAID IT, not I.

Funny thing is I used the word specifically to be reserved.  You called me out! haha

Many people do not know what a budget is, or even that there is such thing as savings accounts/retirement accounts.

oh boy. oh boy.

Credit can be used to your advantage in MANY ways, but you really have to be well educated in credit 

and how it works, for it to work for you.  Again, it isnt a gift card hahaha!

[800who]

Yeah when I said scraping by, I said that is understandable. I guess as I thought about this more yesterday I realized that I haven't experienced a whole lot of life yet, I guess my main point is how it's almost a trend for people to be in outstanding debt and it seems like they aren't even really trying to get out. Credit limit? $5000. Balance? $4800.. they will charge 200.. max it out and then pay 200 on it... rinse and repeat.

[Anonymous]

Have to be getting hit with overlimit fees once that interest hits...hmm

Overspending.

Lets get a "value meal" ....not knowing for two people that would be $10-20

Or chain rest dinner, when it is all frozen/bulk, thawed and cooked to order...

when cooking a meal at home could be as low as $2, $5 or even under $10 with fancy ingredients.

Driving those $350+$550 autos, when could have been cash car or lower payments after saving a bit.

Getting 12-25 mpg, when could have been 35-55mpg...spending $100/wk on fuel vs $10-20

ohhh, spending $5k on that vacation (on credit) vs saving up, thinking well have to be happy

even tho only happy that day(s) if lucky.

ohhh, the cell phone thing (:/facepalm)

Again, no budget.

I used to be guilty of the eating out 4-7 times a week (although in my budget)

However now we go out maybe 2 times a month now. (saving $400-1500/mo)

Also was guilty of buying anything on spot that I/we wanted. (again in budget for most part) but

now think on it for a few days/weeks and only buy normally after agreeing we "need" it.

Most purchases today will either be clothing, food staples,  or other necessary items for kids etc.

All money is budgeted and some goes extra to mortgage, auto, investing/ret, home/auto repair

and prepaying/saving for future as in heat, auto ins and inspections etc. unexpected expenses.

I also have a son that got his first job, and luckily he learned some stuff in economics

and we have chatted about finances a lot so far, as he has to get a bank acct and such.

Gonna try to teach as much as i can about saving vs spending. and budgeting for purchases.

Also about credit and how to use wisely and beneficially. 

Anyone finding themselves in tight spots, need to cut ALL expenses for a few months

until they are starting to save money and build savings....after starting that budget.

Believe me, only takes a few months to see it grow.

Might take a year or years to get out of debt, but it can happen.

It will only make you stronger and more independent as time goes on.

[Kree]

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@iced wrote:

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@Anonymous wrote:

Good for you staying in check!!!

A lot of people are financially responsible, however there are still many that are not.

I blame our society, advertising and marketing.

The ooolala's that get people excited. 

spend away. 

borrow more

up to your eyeballs and then some.

Yes everyone will have a different opinion, and those that are not responsible, will have a different reason.

---

You had me all the way up to the last sentence above, the last word even. I would substitute "reason" for "excuse", and then we're in total agreement. I'll add to this, though in my own sugar-coated style.

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I disagree. Reason is a perfectly acceptable word in this context.  Reasons are causal; excuses are correlations, or ficticious. However causal relationships are also correlations, so we can use Reason as a blanket term, and without knowing the specifics of a scenario it would be rude to the speaker to define their statement as an excuse without knowing the full context.

For example,  "My business failed because my employees stole from me."  could be a reason because the statement is true. I've read stories about CFOs embezzling millions of dollars and by the time the deed was found out, the business was unsalvagable.  The statement could be an excuse because it is just a correlation.  Yes the cashier took 5 dollar out of the register every shift, but the theft, even over years, would only amount to a small percentage of the companies total gross.  The statement could also be a ficticious excuse.  No employees actually stole from the company but the owner did not want to admit to the real cause.