Lets talk about your money now

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purcell
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Lets talk about your money now

Unread post by purcell » Fri Jan 06, 2017 11:06 pm

I am very surprised! :?:

„Revolving Credit Card” is normal and used everywhere in USA and Great Britain? ...widely used ?
Developed in 1958 by Chase Manhattan Bank and Bank of America!

With excessive interest?

I can´t believe that.

1000 loan...by 17% and revolving for years?

There was an example: 1500 loan ... 18 % p.a. ... repayment rate 2%/month!

First year: 350 paid! ... only 75 really paid back.

Remaining amount: 1425 ! after one year.
-----------------------------------------------------------
It would last 19 years!...this way, until it is repaid.

Probably a bad example.
----------------------------------------------------------
Or do they all pay it back within 1-2 month? ..absolute advantage: No costs at all!

But in general I was very astonished, that this kind of "horror credit cards" („Revolving Credit Card”)
are normal ,standard and widely used in USA and GB?

I only want to know: Is that a fact?.... :?:
Don´t tell me: That's true, of course. 8O
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Saul
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Re: Lets talk about your money now

Unread post by Saul » Fri Jan 06, 2017 11:56 pm

That is absolutely true Purcell. The UK and USA pretty much revolve around debt. I think the UK has one of the highest personal debt rates in the world and that 17% you mentioned is on the good side of things 8O Some credit cards are charging a whopping 39% or more!!!

However you have to put it in context. For years the cost of living has kept rising but salaries have not risen to match. This effectively means people are taking a pay cut year after year. So in order to live they have overdrafts at the bank and revolving credit cards. It's by no means ideal but it's life and for people to get out of that cycle is next to impossible if salaries are not increasing.

Of course there are people who have been careful with their money. Never spending anything they don't have and so on and i say well done them, it's not an easy thing to do. But they are an exception

However, let's not demonise the average person with a credit card and a mortgage. What they owe as personal debt is nothing compared to most large businesses who's run entirely on debt. Many of our well known companies are millions of pounds in debt. Without funding from banks and private investors they simply could not continue to trade. The UK as a country is over a trillion pounds in debt and the USA is multi trillions in debt. But don't think that it is just the UK and USA. You only need to look to the EU countries and you will soon discover none of them are truly solvent.

The world revolves on debt. I can't see that changing any time soon.
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Re: Lets talk about your money now

Unread post by purcell » Sat Jan 07, 2017 12:33 am

Hello Saul!
Thanks for that "unexpected" answer!
So! It´s really true!

Sure! There is "future money" (debt/loans etc.) everywhere around the planet!
Seems only without China!? ... A rich country...giving loans to all and everything! :lol:

Now I have learned a lot! ... Even worse, to use revolving credits...to stretch the misery.
And paying back with real 200% - 300% or more.
Or pay it back never...and keep the revolving credits running eternal!
Always using the "honey pot" on and on.

I didn´t know that this "revolving horror!" is normal and used everywhere in GB and USA.
But I know: There are national debts everywhere. To pay back until 2400? :lol:

No wrong!
Our "Schäuble" is now on real ZERO! ... and we pay for that - always and everywhere.
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Schäuble sitting on the (our) money always saying: "No!!!"
That´s really the best way to save money!
Simply NO!!!
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Re: Lets talk about your money now

Unread post by parametric » Sat Jan 07, 2017 1:59 am

Saul wrote: Of course there are people who have been careful with their money. Never spending anything they don't have and so on and i say well done them, it's not an easy thing to do. But they are an exception
I am proud to be part of that exception. We are mortgage-free, and own everything else we have. I claim NO responsibility for this (apart from earning my living whilst I was working) as it was entirely due to my Partner Jan's exceptional money juggling . . .
We were constantly inundated with letters that we only needed to pay £x on the mortgage - but Jan ignored these, and in fact INCREASED our payments several times, such that when our Flat was sold, we owed £1 on it. Buying our house did involve a small mortgage - which was dealt with in the same way. It was paid off about 7 years ago - but make no mistake! it was not without PAIN . . .
Saul wrote:The UK as a country is over a trillion pounds in debt and the USA is multi trillions in debt. But don't think that it is just the UK and USA. You only need to look to the EU countries and you will soon discover none of them are truly solvent.

The world revolves on debt. I can't see that changing any time soon.
Sadly, it's worse than that I think, Saul . . . About three years ago, the UK's National Debt was 4.8 Trillion pounds - (A Trillion being 1000,000,000,000) or about £77,000 for every Man, Woman and Child (then) in the UK.

The main reason? - an EXPLODING Public Sector, consuming the taxation levied on a shrinking Private Sector (i.e - Wealth PRODUCERS)

Welath producers are taxed into oblivion and businesses collapse. The government - finding it cannot continue to FUND the burdgeoning Public Sector, then has an "Annual Borrowing Requirement" that escalates exponentially - and so we are "In the loop" and the message from Government becomes "Borrowing is GOOD, Saving is BAD" (to justify their position).

The "End Game" perceived by the government is "Quantitative Easing" - the "polite" term for Printing Money - or STEALING from the Electorate . . . .as I prefer to call it . .

And we all know where THAT leads . . . The Weimar Republic of Germany 1921 - 1924 and more recently in Zimbabwe, where Z$5000,000,000 wouldn't buy a loaf of bread . . . .
Five Billion Dollars.jpg


Let the Wealth Creators BENEFIT more from their work. Until that changes - Society will eventually collapse. Those Wealth-Creators will simply walk away and start up somewhere else where they can get a fairer share of their labours.

I have a 90 minute video explaining all of this and what MIGHT be done, but unfortunately it's too large to upload here . . .

parametric
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Re: Lets talk about your money now

Unread post by Daviedawg » Sat Jan 07, 2017 10:33 am

We bought our first house in 1973 (I think or 1972?). Within a year the mortgage rate was 15%. It did not last too long at that but we kept paying the highest figure because we were both working. After 6 years we almost owned the house. But since then we have always kept our debt to as near zero as possible because you never know what is round the corner. Even if we are better economic forecasters than the Bank of England.
Modern thinking is to borrow borrow and borrow. Personal and business scenarios.

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Re: Lets talk about your money now

Unread post by Saul » Sat Jan 07, 2017 11:09 am

We are also not massively in debt. We took a large loan about 10 years ago to renovate my mother-in-laws apartment in Ukraine. We didn't look on it as any sort of investment, but rather just to improve a persons quality of life and we were happy to do it. I think we have just under four years left to go on that. We also have two credit cards that we keep for emergencies, only occasionally using them to keep them ticking over in terms of boosting our credit profile, just in case we need it down the line. However we pay anything used in full within 30 days so there is no interest incurred.

I do understand though that many people simply cannot get out of the cycle of debt and also there is a big difference between "manageable" debt, where you can afford to keep on top of all the payments and that spiralling out of control sort of debt where you need to borrow more from one source just to pay off another.

The solution to all this of course is as Chris said, stop hammering the wealth makers and sort out the completely ludicrous public sector. Then there is our welfare system that sucks up a massive proportion of our GDP and has become a way of life for millions of people. It was never intended to be like this. We have generations of families who have never worked a day in their lives and never contributed to the country. They have no intention of ever working at all but we keep throwing money at them. That doesn't solve anything. We need to tackle it and get on with sorting it out.

Then there is our foreign aid budget. We send billions of pounds to countries who do not need it simply to have some sort of political influence but does it really buy us that? and to what end? I have nothing at all against helping people in need but we have plenty of those here in our own country. Until we are in a situation where there are no people sleeping under bridges and in doorways and no one goes without life saving drugs because they are "too expensive" we should be concentrating our efforts at home before helping people abroad.

Oh by the way Purcell, I forgot to mention the "pay day lenders" whose interest rates are in the thousands of percent!
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Re: Lets talk about your money now

Unread post by SysExJohn » Sat Jan 07, 2017 12:08 pm

Like Chris and Dd, we must be part of the "exceptions" group you referred to, Saul.

We own our house and, like Dd, I remember only too well the 15% interest rates under our very dear Maggie.
We stuck with it and kept paying which reduced the term considerably.

We pay for most more expensive things using a credit card, but only if we have the money to pay the debt in full when the first payment falls due.
It gives a level of insurance if things go wrong.

As a pensioner now, I can't afford to fall into debt. I'd never be able to pay it back.
I recall my parents being horrified when I bought my first car on finance.
"Neither a borrower nor a lender be" they told me.
In retrospect, I think they were right, to some extent.
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Re: Lets talk about your money now

Unread post by Saul » Sat Jan 07, 2017 12:39 pm

Unfortunately we have not left much of a legacy for young people coming into the workplace. Many are saddled with debt already because of student tuition fees which many of the previous generations never had to pay. Add into that the extremely high price for property rental and low wage growth and it's a perfect storm of continual debt.

I know something of this because my life has been somewhat back to front. When I was younger I had no intentions of ever getting married and having a family so my whole life was centred around living for the moment. I didn't get married until I was 41 and really it's only now, 15 years later that we have looked at where we are and where we want to be. As a result unlike many in my age group who will be building up to retirement I am looking at stepping up a gear and working harder than ever. We will get there but I have the satisfaction of at least knowing I didn't give up on anything or compromise in order to do it :)

What prospects are there for young people these days? High rents, little chance of home ownership and of course the subject of this thread, revolving credit.
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Re: Lets talk about your money now

Unread post by purcell » Sat Jan 07, 2017 3:25 pm

Also something special used in GB and USA? (I didn´t know it!)

Payday loan (Info)

https://en.wikipedia.org/wiki/Payday_loan
----------------------------------------------------
Payday loan and revolving credit cards!
And borrow,borrow,borrow...
What a scene!

BUY NOW! PAY LATER!
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Re: Lets talk about your money now

Unread post by parametric » Sat Jan 07, 2017 4:59 pm

As you say Saul, we're not leaving a very nice world for our children . . .

And yes, John . . . I remember WELL the saying "Never a borrower or a lender be" . . . .

If any of you want to examine the issues in more detail, I have just created a special account on my server where you may download the

video I mentioned. It's in a read-only folder(for security) but it's a 707Mb .mp4 - so possibly and overnight job for some . . . :(

If you <pm> me, I'll be pleased to give you the details . . . .

MANY recognisable politicians appear in it, including ex-chancellors and Prime Ministers.

The problems are explained in a very graphical manner, which is quite entertaining in itself . . .

The Solution suggested at the end is indeed "thought-provoking".

IMO, the present band of idiots in charge should be FORCED to watch this . . . .

It's three years old now, - but very little has changed . . . .

parametric
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