About Me

Name: Playful Walrus
Biography
Loading...

Create Your Own Blog Find Other Townhall Blogs

Comments

Don't Buy Things You Can't Afford

Posted by Playful Walrus on Tuesday, February 24, 2009 6:27:39 PM
There's a radio ad I've been hearing for a certain service that gives people cash for their gold (such a jewelry) that they send in.  It starts off with "Everybody has credit card debt – everybody!"

They immediately lose me there.

My wife and I don't have credit card debt.  We didn't as unmarried people, either.

How is this possible?

Well, we only use credit cars that charge no annual fee.

We only buy goods and services with the credit cards that we could by with the money cash we have at that time in our bank accounts.

We pay our credit card bills in full.  On time.  Every month.

Admittedly, this requires having some savings so that if we run into some emergency or "emergency" like car repairs, we won't be incurring charges on our credit cards that we will not be able to pay when the bill comes due.

Anyone can accomplish this.

Why pay a dime in late fees or interest when you don't have to?

So no, credit card debt is not universal, even for people who use credit cards.

Of course, the ad probably does apply to so many people that it works.  And if the banks who issued the credit cards are getting bailout money, they are getting money from me anyway.
Email ItEmail It | Print ItPrint It | CommentsComments (0) | TrackbacksTrackbacks (0) | Flag as offensiveFlag as Offensive

High Schoolers Don’t Know Money

Posted by Playful Walrus on Thursday, April 10, 2008 3:08:41 PM
Does it really surprise us in the age of subprime mortgages, checks for anyone who files a tax return, payday loan stores, and government-as-daddy that our high school students don’t know money?

Jeannine Aversa, AP Economic Writer, reports:
High school seniors, on average, answered correctly only 48.3 percent of questions about personal finance and economics, according to a nationwide survey released Wednesday by the Federal Reserve.
But I bet they can all tell you about our impending environmental doom.
With home foreclosures at record highs, Fed Chairman Ben Bernanke stressed in a speech that young people must sharpen their financial knowledge so they are in a better position to make sound investment decisions throughout their lives.
Clearly.
In this year's survey, only 16.8 percent correctly answered that stocks likely would offer the higher growth over 18 years of saving for a child's education, while 37.3 percent thought a U.S. savings bond — one of the most conservative investments - would offer the highest growth.

Nearly 53 percent said they would have no liability if their credit card was stolen and a thief ran up $1,000 worth of debt. (Liability is limited to $50 after the credit-card issuer is notified.) Only 13 percent knew they might have to be responsible for $50.
Our schools should be teaching students some basics about economics and finances:

-Supply and demand
-It takes capital to make capital
-Spend less than you make, saving and investing the difference
-Different kinds in investments
-How insurance works
-How credit and loans work
-Interest rates
-How corporations are owned and function, passing along costs to consumers, investors, or employees
-The government runs on our money – when it spends more than it takes in, that will cost us more later.
-Debt in general is costly
-Crime is costly

I recommend people read up on Ron Blue's material.
The surveys, done every two years, were sponsored by the Jump$tart Coalition for Personal Financial Literacy, which wants students to have the skills to be financially competent.
Email ItEmail It | Print ItPrint It | CommentsComments (0) | TrackbacksTrackbacks (0) | Flag as offensiveFlag as Offensive
« Previous1Next »