How much debt do you have? [Archive] - Two Plus Two Older Archives

Inthacup

04-08-2005, 01:06 PM

Excluding mortgage, $0.

Do you guys ever listen to Dave Ramsey? If not, here are archived files (http://www.daveramsey.com/radio/home/index.cfm?FuseAction=dspContent&strMode=dspShowArc hives) of the last week of his talk radio show. He has a really sound plan for getting out of debt, plus his show is enjoyable to listen to.

Cup

CCx

04-08-2005, 01:13 PM

car - 15k
student loans (good thing i dropped out, still paying 7 years later) - 6k
credit cards - 8k

i totally picked the wrong category, whoops

mccreadj

04-08-2005, 01:15 PM

$110,000 in student loans(law school), about $3,000 left on car, and $5,000 on credit cards.

tolbiny

04-08-2005, 01:16 PM

1,500 on my car (to my brother- so interest free /images/graemlins/grin.gif)

Other than my half of the mortgage and 300 bucks on my credit card for my vegas trip- debt free!

Inthacup

04-08-2005, 01:23 PM

Sell the Explorer.

Bulldog

04-08-2005, 01:29 PM

[ QUOTE ]
wife's student loans.

About $800 on a credit card, which will be paid off when I get the next statement.

Oh, and about $25,000 in truck payments. Not counting those are you? If so, make it ~36k.

[/ QUOTE ]

800+25000=36000?

For me, $200 on an interest-free furniture CC and that is all. Car and student loans paid off long ago. No better feeling than no debt!

Shajen

04-08-2005, 01:31 PM

[ QUOTE ]
[ QUOTE ]
wife's student loans.

About $800 on a credit card, which will be paid off when I get the next statement.

Oh, and about $25,000 in truck payments. Not counting those are you? If so, make it ~36k.

[/ QUOTE ]

800+25000=36000?

For me, $200 on an interest-free furniture CC and that is all. Car and student loans paid off long ago. No better feeling than no debt!

[/ QUOTE ]

Wife's student loans are about $10k.

Inthacup

04-08-2005, 01:32 PM

Sell the truck.

Rick Diesel

04-08-2005, 01:35 PM

Not happening. It is new (bought in November) and there is no way I will ever drive a non-SUV again. I traded in my Cobra when I got it and thought that I would not like it but I was certainly wrong. Also my dogs love riding in the back of it. Plus the wife and I are planning on having little Diesel's running around soon, so the Explorer will be handy there too.

RunDownHouse

04-08-2005, 01:42 PM

17K in student loans.

And Dave Ramsey, along with the vast majority of callers on his show, is a simpering idiot.

Paluka

04-08-2005, 01:44 PM

[ QUOTE ]
there is no way I will ever drive a non-SUV again. Plus the wife and I are planning on having little Diesel's running around soon, so the Explorer will be handy there too.

[/ QUOTE ]

I'm glad you are having kids soon, because the USA needs more soldiers to fly over to random countries so we can get all the oil that you need to drive your Explorer.

Shajen

04-08-2005, 01:45 PM

[ QUOTE ]
Sell the truck.

[/ QUOTE ]

Wanna buy it? /images/graemlins/wink.gif

For the record, I've already paid it down a good bit. I expect to have it paid off in about 2 years. Not only that, but the interest rate is 1%. I'm debt free other than it and the mortgage payment. My wife, on the other hand, has those damned student loans. They are currently interest free though, so I'm in no hurry.

But yeah, being debt free is the way to go.

I'm headed that direction, a couple three years ago I had over 15k in credit card debts alone. This month I'll have no credit card debt at all. It's nice.

Shajen

04-08-2005, 01:49 PM

[ QUOTE ]
[ QUOTE ]
there is no way I will ever drive a non-SUV again. Plus the wife and I are planning on having little Diesel's running around soon, so the Explorer will be handy there too.

[/ QUOTE ]

I'm glad you are having kids soon, because the USA needs more soldiers to fly over to random countries so we can get all the oil that you need to drive your Explorer.

[/ QUOTE ]

BOOOOOOO

Inthacup

04-08-2005, 01:51 PM

You have $30,000 in student loans and you decided to buy a $20,000+ SUV that you didn't have the money to pay for?

there is no way I will ever drive a non-SUV again

That's fine, but if you're concerned at all about getting out of debt, you should sell the Explorer, and buy something in the $3000-5000 range.

Option 1: You live modestly for a while(depends on your income), put all your effort into paying off your student debts and becoming debt free. You then invest your money, pay for things with cash and retire rich or

Option 2: You run up a ton of debt(doing that right now) and spend the next several decades paying it off.

I would highly recommend clicking on the link I posted and listening to a few hours of the Dave Ramsey show. It will change your life for the better. But, if you don't care about that and don't care about living a debt free life, disregard what I said and continue going down the stupid path you've chosen.

Cup

Inthacup

04-08-2005, 01:55 PM

I have no problem with you feeling this way, but I would like to hear you elaborate.

CCass

04-08-2005, 02:01 PM

Excluding my mortgage, my wife and I have $0 debt. We owe about $25K on our house, and will have that paid off in about 2 years. We will be under the age of 40, and completely debt free WOOT!!!

Inthacup

04-08-2005, 02:02 PM

Congrats. That rocks

CCass

04-08-2005, 02:04 PM

[ QUOTE ]
17K in student loans.

And Dave Ramsey, along with the vast majority of callers on his show, is a simpering idiot.

[/ QUOTE ]

Ramsey's plan is both Mathematically sound, and logical. If you have a better plan for sound financial living, I would like to hear it.

sublime

04-08-2005, 02:06 PM

does my car count?

Rick Diesel

04-08-2005, 02:06 PM

Everyone has a different view on how to spend their money. My theory is that while I am young and have no responsibilities (i.e. kids) I will buy nice things, take lots of vacations, and spend my money without much care. [censored], if you count mortgages then I am well over $1,000,000 in debt. But then you should count the 10-unit apartment building and 2 real estate partnership interests that I own.

Yes, I am 26 years old and have a [censored] load of debt. However, the great majority of my debt (mortages on rental properties) is being paid off by someone else. I would rather invest money that I made in more real estate then use it to purchase a vehicle, so I finance my vehicle because the cash will benefit me more in the future.

mmbt0ne

04-08-2005, 02:12 PM

</font><blockquote><font class="small">En réponse à:</font><hr />
Student loans suck.

[/ QUOTE ]

What are those? /images/graemlins/tongue.gif

Just kidding, because I'll probably be finding out in the next month or two. /images/graemlins/frown.gif /images/graemlins/mad.gif

A+ job to me though, for already being in probably about $4kish. By May it should be $3k though.

sublime

04-08-2005, 02:14 PM

well i guess my car does count. so i owe about 4k. i will probably pay that off next month. so i am basically debt free.

btw, i agree with cup. if you have any debt and willingly add more, you should probably stop. its a moronic way to spend your money.

i would recommend that most of you guys with loads of debt, read 'the millionare next door'. good book.

RunDownHouse

04-08-2005, 02:33 PM

[ QUOTE ]
I have no problem with you feeling this way, but I would like to hear you elaborate.

[/ QUOTE ]
Sample Call
Caller: Dave, I'm in horrible debt!
Dave: How much?
Caller: 100K. I did .
Dave: OK, here's what you need to do. Sell off your fancy car - the one you can't afford - consider moving out of your house - the one you can't afford - into a smaller one, and then spend less and save more.
Caller: Dave, you're a genius!
End Sample Call

I don't know how anyone could listen to that for an hour or whatever and think Ramsey is an incredible innovator. Yes, he's practical. Yes, his advice is good for people who don't understand anything about money and have serious credit card debt. For the rest of us, its mind-numbingly simple answers to stupid problems.

Also, debt isn't the horrible thing Ramsey makes it out to be. Obviously too much credit card debt will kill anyone, that's true. But there's nothing wrong with going into debt for, say, a car, [i]as long as you expect your future income to be able to handle it. If I can expect to make 100K within 5 years, then I should go ahead and spend more than I currently make. It smooths out my consumption patterns, and I get more enjoyment out of life overall than if I had waited until I actually had the money physically in my possession.

davelin

04-08-2005, 02:38 PM

Wife's medical school loans.

NoTalent

04-08-2005, 02:48 PM

I've got 6500 left in student loans, down from 13,500. I should have had it paid off now, but I've been slacking on my payments (not paying extra)

CCass

04-08-2005, 03:55 PM

[ QUOTE ]
[ QUOTE ]
I have no problem with you feeling this way, but I would like to hear you elaborate.

[/ QUOTE ]
Sample Call
Caller: Dave, I'm in horrible debt!
Dave: How much?
Caller: 100K. I did .
Dave: OK, here's what you need to do. Sell off your fancy car - the one you can't afford - consider moving out of your house - the one you can't afford - into a smaller one, and then spend less and save more.
Caller: Dave, you're a genius!
End Sample Call

I don't know how anyone could listen to that for an hour or whatever and think Ramsey is an incredible innovator. Yes, he's practical. Yes, his advice is good for people who don't understand anything about money and have serious credit card debt. For the rest of us, its mind-numbingly simple answers to stupid problems.

Also, debt isn't the horrible thing Ramsey makes it out to be. Obviously too much credit card debt will kill anyone, that's true. But there's nothing wrong with going into debt for, say, a car, [i]as long as you expect your future income to be able to handle it. If I can expect to make 100K within 5 years, then I should go ahead and spend more than I currently make. It smooths out my consumption patterns, and I get more enjoyment out of life overall than if I had waited until I actually had the money physically in my possession.

[/ QUOTE ]

I agree with you that a person should use their money in a way that allows them to get maximum enjoyment out of life.

For me, I get a great deal of enjoyment out of knowing that I made the mathematically correct decision that will maximize my net worth in the long run. Different strokes for different folks.

Dead

04-08-2005, 03:57 PM

$45.23

turnipmonster

04-08-2005, 03:58 PM

NC rocks, I went to a state school with a very solid engineering program and my entire undergrad education cost me < 10k. later I went to music school in nyc and 1 SEMESTER costs more than this.

--turnipmonster

Number4

04-08-2005, 05:13 PM

[ QUOTE ]
Student loans suck.

[/ QUOTE ]

97k in student loans, thanks to law school.

RunDownHouse

04-08-2005, 05:20 PM

[ QUOTE ]
For me, I get a great deal of enjoyment out of knowing that I made the mathematically correct decision that will maximize my net worth in the long run. Different strokes for different folks.

[/ QUOTE ]
Right. I don't think I could improve on Michael Davis' comment about that earlier in the thread.

PS Don't get caught up in "accounting mathematics" and leave out utility.

pshreck

04-08-2005, 05:22 PM

[ QUOTE ]
[ QUOTE ]
Student loans suck.

[/ QUOTE ]

97k in student loans, thanks to law school.

[/ QUOTE ]

Pretty ridiculous that you took on this much.

I assume it wasn't your original plan?

Reef

04-08-2005, 05:27 PM

20k + ... college is expensive

Number4

04-08-2005, 05:30 PM

[ QUOTE ]
Pretty ridiculous that you took on this much.

I assume it wasn't your original plan?

[/ QUOTE ]

Pretty ridiculous that law school costs this much. And, yes, it was my original plan - no way to pay without loans.

morello

04-08-2005, 05:30 PM

No debt at all. 21 years old though, so I don't exactly have many fancy things.

Actually I have a big chunk of cash that I'll probably spend in the next year or so. Likely real estate, but maybe something else.

eric5148

04-08-2005, 05:31 PM

$0 debt.

I've never had a credit card, and never taken out any kind of loan. I have a somewhat radical view about money: if I don't have the money to buy something, I don't buy it.

BWebb

04-08-2005, 05:32 PM

Forgot to share my own. I owe about $6k in student loans, $1k on my new tv purchase (it was zero percent financing. That is the only reason I put it on a card), $1k in credit card debt (mostly because I just paid for my gym membership for the year to save $120) and $950 for a computer loan (also zero percent financing through my job). Besides my student loans, my debt is mainly due to being able to save money. I hope to get the majority of this paid off by the end of the year and purchase a condo.

BWebb

04-08-2005, 05:33 PM

[ QUOTE ]
$0 debt.

I've never had a credit card, and never taken out any kind of loan. I have a somewhat radical view about money: if I don't have the money to buy something, I don't buy it.

[/ QUOTE ]

I believe all of this makes you un-American.

pshreck

04-08-2005, 05:38 PM

To those of you who take on huge loans for undergrad...

I assume that most of your parents are supposed to be able to pay a good amount. Are they not doing that? This of course is not rare, it just dumbfounds me that parents choose to focus on their own retirement over this stuff

Secondly, it would be helpful if at the age of 18 someone explained to students the nature of debt and what loading up on it could really do to you.

On a specific example, I had a friend choose between Tulane and UConn. Essentially choosing between 35-40k per year and 7k per year. His parents refused to pay and he ended up taking on about 19k in loans per year when he chose Tulane. He is graduating with a CS degree, roughly 80k in loans, and is frankly quite screwed and upset with himself.

In his personal case, a weaker degree from a state school and that 80k invested into himself would obviously have made for a happier younger life, and most likely would have had a marginal difference on the outcome of his career.

FWIW, after talking to some people, I transferred from Lehigh (39k per year) to UConn because I just didnt understand the difference in value of accounting degrees. My brother took notice and did the same thing with Villanova to Uconn. With the money my parents are saving, they are putting a down payment on a beach house.

The point of this whole post, is that I think it's sad younger people aren't really aware of the effects of debt, and their idealistic assumptions that their strong undergrad degree will eventually save them are often wrong.

pshreck

04-08-2005, 05:42 PM

Dead

04-08-2005, 05:43 PM

I go to a SUNY school, and it's only 4k a year tuition. It was $3500 two years ago, but this is the top SUNY one so it is still a great school.

I didn't want to burden my parents with a huge bill when I didn't even know for sure what I wanted to do yet.

I don't buy into the whole private>public thing that some are all about on here.

I'm getting a great education here, at a bargain price. NY has a great state university system.

eric5148

04-08-2005, 06:04 PM

[ QUOTE ]
You really need to just take an econ 101 course to learn how wrong this is.

[/ QUOTE ]

What am I wrong about? You're saying it's good to be in debt?

pshreck

04-08-2005, 06:10 PM

[ QUOTE ]

What am I wrong about? You're saying it's good to be in debt?

[/ QUOTE ]

Your not getting it, and it would be really hard for me to explain it all to you in a forum post. Ill do a very very short run over.

Let's take a lake house for example. Lot's of American' have them, but how many do you think just bought them outright? Probably less than 1 in 20 (thats being generous). If you and your family want a lake house for the summer, but don't have the money for it, will you just wait until you are 75 and then buy it? When your kids are grown up and dont care?
No, you wouldnt, you would take out a loan from the bank, and buy it (assuming reasonably assured future income, money for a downpayment). You dont mind paying interest, that is almost like a fee for being able to enjoy the lake house during your prime years.

Their is a great utility in this house, and other things, that you can't afford right out. It does not mean you shouldn't buy them though.

Hope this helps some?

Dead

04-08-2005, 06:11 PM

It is obviously better to buy them outright, if it is at all possible. This is hard for most people, but if you have the cash to buy a car, then it is obviously preferable to buy the car outright(unless you can find a 0% interest deal). Finance charges suck.

I think this is what Eric is getting at.

pshreck

04-08-2005, 06:13 PM

Dead, I know what he is implying. Im talking about the real world though.

pshreck

04-08-2005, 06:15 PM

[ QUOTE ]
but if you have the cash to buy a car, then it is obviously preferable to buy the car outright(unless you can find a 0% interest deal).

[/ QUOTE ]

I imagine you have never bought a car?

eric5148

04-08-2005, 06:21 PM

I wasn't trying to say I would never buy a house if I didn't have every last cent right there in my checking account. I'm saying I would never do what some people in this thread have done, which is make big purchases they really don't need while already in debt or close to it.

pshreck

04-08-2005, 06:23 PM

[ QUOTE ]
I have a somewhat radical view about money: if I don't have the money to buy something, I don't buy it.

[/ QUOTE ]

This is what Im responding to. I agree to not overextend yourself, but I disagree with never borrowing money.

Inthacup

04-08-2005, 06:25 PM

I bought a car with cash and buy as much as I can upfront with cash. You speak of the utility principle, which is exactly why I chose this philosophy.

I have been fortunate in online poker and it has allowed me to be in a place where I couldn't be otherwise. However, there is no long term stability in what I'm doing. I pay for everything now and live within my means because if online poker falls through tomorrow, I'm not going to be [censored] as a result. That peace of mind is worth much more to me than some frivolous short term happiness I may gain from spending more than I make.

Cup

J.R.

04-08-2005, 06:28 PM

par for the course, maybe a bit light

sublime

04-08-2005, 06:29 PM

You're saying it's good to be in debt?

the only 'good' debt is a mortgage. its actually the best loan you will ever have, and you should extend it as long as possible.

other than that, paying with cash is the way to go.

Dead

04-08-2005, 06:30 PM

If someone can comfortably afford to pay for a house outright, then what is the point of a mortgage? Not saying that this is the norm, but just curious.

pshreck

04-08-2005, 06:32 PM

[ QUOTE ]
If someone can comfortably afford to pay for a house outright, then what is the point of a mortgage? Not saying that this is the norm, but just curious.

[/ QUOTE ]

The same issue with your idea of always buying a car outright... it is easier and cheaper to take out loans for houses (and cars) then most things.

If you spend all your savings on a house, but then can't afford furniture, food, vacations, etc... then you would have to go in to debt on those things (which is much worse).

Homer

04-08-2005, 06:33 PM

I don't even know, somewhere between $70K and 80K. If I had it to do over again, state school, for sure.

sublime

04-08-2005, 06:36 PM

If someone can comfortably afford to pay for a house outright, then what is the point of a mortgage?

simple. a mortgage loan will cost you (x%) while the stock market has paid (y%) over the past 60 years. so assuming you invest the money you save by 'not' paying for the house up front and invest in in long term stocks (or whatever), then its a pretty simple decision. there are also other added benefits, but this is the most simple and basic.

moondogg

04-08-2005, 06:38 PM

[ QUOTE ]
You're saying it's good to be in debt?

the only 'good' debt is a mortgage. its actually the best loan you will ever have, and you should extend it as long as possible.

other than that, paying with cash is the way to go.

[/ QUOTE ]

Assuming that you will otherwise invest the money earning a certain percentage, it's often worthwhile to take out loans that you don't actually need.

For example, if you can get a loan with less than 2% financing (like store promotion), it's better to keep your cash in a savings or investment account making more than 3%.

Of course, this assumes that you actually DO have the money, and you actually ARE going to invest it instead of paying cash upfront. If you are getting a loan because what you're buying is out of your price range, or if you are going to buy beer and hookers instead of putting the cash in the bank, then it's a totally different issue.

sublime

04-08-2005, 06:41 PM

[ QUOTE ]
Assuming that you will otherwise invest the money earning a certain percentage, it's often worthwhile to take out loans that you don't actually need.

For example, if you can get a loan with less than 2% financing (like store promotion), it's better to keep your cash in a savings or investment account making more than 3%.

Of course, this assumes that you actually DO have the money, and you actually ARE going to invest it instead of paying cash upfront. If you are getting a loan because what you're buying is out of your price range, or if you are going to buy beer and hookers instead of putting the cash in the bank, then it's a totally different issue.

[/ QUOTE ]

as usual, somebody else makes my post sound a lot better /images/graemlins/smile.gif

bholdr

04-08-2005, 09:28 PM

car: 0$
student loans: 0$
cards: 0$

of course, because i've never had ANY debt....

credit: 0$

kinda bookends nicely. i'm getting a visa to charge all my food/gas to to try to build some credit soon.

actually, i am OWED money. but i've given up on ever seeing it again.

34TheTruth34

04-08-2005, 09:32 PM

Sponger15SB

04-08-2005, 09:41 PM

Sponger15SB

04-08-2005, 09:44 PM

The timing of this song to play right when I got done with my post was incredible...

http://img.photobucket.com/albums/v641/Sponger15aa/Beatles.jpg

eric5148

04-08-2005, 09:48 PM

I didn't go to college.

Skipbidder

04-08-2005, 10:32 PM

Pushing 300K with student loans of
$13,892 from undergrad and MA
$48,607 MS
$225,414 MD

Plus
$6500 I owe my ex-wife.
$200 I owe my bridge partner

I will find out how cheap my consolidation loan is in a month or so.

NoTalent

04-09-2005, 12:55 AM

Skip--I've heard that MD's usually pay off the minimum per month for the rest of their life on their loans because they won't be able to pay it off. Is that true? 225K is a huge amount wow. What is your practice?

Skipbidder

04-09-2005, 02:23 AM

Internal Medicine. Just starting. (Current plan to specialize as either a hospitalist or infectious disease doc--neither being a big money speciality.)
I'll probably take the full 30 years to pay it off because my consolidation loan will be very cheap. In June, I'll find out the fixed rate I can get. I've got 3 years of residency, then perhaps add a couple more years for chief residency and/or fellowship. After that, I'll start making enough money that I could consider paying loans off at more than minimum. (The contract I just signed is for $41K, so I couldn't really make a dent in the loans now even if I wanted to.)

My impression is that recent grads aren't paying off their loans at more than a minimum because even a retarded squirrel could easily make more via investment than the 2.5-3% that docs are paying on their loans, so paying off the loan actually costs money. Docs who graduated when interest rates were higher might see it differently.

My school was relatively expensive, I borrowed the entire cost of tuition, and I also borrowed the allowance for living expenses. My loan debt is certainly on the high side, but many of my classmates are also over 200K. Things could be worse. I don't have a car payment or any credit card debt, and I got away mostly unscathed in my divorce.

Dead

04-09-2005, 02:24 AM

Internal Medicine, cool.

My dad is an internist. He originally did his residency in anesthesiology though. But then he went back 10 years ago and did his IM residency and that's what he does now. So he's double boarded.

handsome

04-09-2005, 02:53 AM

[ QUOTE ]
I go to a SUNY school, and it's only 4k a year tuition. It was $3500 two years ago, but this is the top SUNY one so it is still a great school.

I didn't want to burden my parents with a huge bill when I didn't even know for sure what I wanted to do yet.

I don't buy into the whole private>public thing that some are all about on here.

I'm getting a great education here, at a bargain price. NY has a great state university system.

[/ QUOTE ]

I wouldn't say NY has a great state university system (CALIFORNIA DOES) but it definitely is a bargain compared to private schools. The problem with SUNY's is that the tuition cost is increasing every year (I don't know about you but I go to SUNY-Binghamton and I'm paying like $4k tuition a semester). I don't really have a point here, but the bottom line is California's UC's pwn us

Dead

04-09-2005, 02:54 AM

I didn't know you went to Binghamton, man. I go to Geneseo. I applied to Binghamton as well but I liked the Geneseo campus better.

We're getting good value for our money. We're at the top two SUNYs imo.

And we DO have a great university system. You're right that UC pwns us, but SUNY pwns pretty much every other state except Cali.

And there's no way you're paying 4k tuition per semester unless you're in a graduate program. In which case it's still an awesome deal because you'd be paying at least 15k per semester at a private grad program.

daryn

04-09-2005, 03:57 AM

i own my car.

i pay off all credit cards monthly.

i have about $5,000 of debt left to my parents (college).

of course i will probably pay this off in a lump sum any day now. at which point i will be debt free.

i owe it all to online poker!

gvibes

04-09-2005, 04:12 AM

Are these options some sort of joke (I haven't read the whole thread yet)?

I have 7 times the maximum option in student loan debt. And that is after graduating undergrad DEBT FREE. My net worth is going to become even more obscenely negative once I get a mortgage for my condo this summer.

EDIT: All right, I read the whole thread now. I am one of the law school people, and borrowing my way through was the original plan. Actually, the original plan was attending NYU law, which would have ended up costing me more like 200k (their finaid wasn't exactly generous).

I drive a 10 year old Honda Civic, and am buying the cheapest condo that meets some basic requirements (2 bed/2 bath, walking distance to work, some others...) - assuming someone will be kind enough to give me a near zero down loan.

I'm graduating in May, and I have no regrets.

AncientPC

04-09-2005, 04:44 AM

Last month: $10k.

This month: $0 (well maybe a few hundred left on credit cards).

Sifmole

04-09-2005, 09:39 AM

There are only 3 things worth going into debt for:

The first is a house, because most people cannot afford to buy a house without a mortgage early in their lives. Buying with a mortgage is much more money efficient than renting until you save up enough to buy the house without a mortgage, because you will build up equity rather than paying off someone elses mortgage. So this makes financial sense.

The other two, are "debt to make money":

Two, student loans; you figure to make an increased salary based on the education you get. So balance your expectation vs the cost of schooling. Paying 110k to get a job that pays 30k / yr after 10 years of experience is a bad plan.

Third, investments; if you can find an investment where you can earn more in ROI vs the interest percentage -- this makes financial sense, and is generally not considered "debt". This also includes starting a new business; of course few businesses succeed but a bit of debt is usually a fine financial decision for somebody who truly thinks they can make a go of it.

Debt to buy cars, tvs, vacations, blah blah blah -- is stupid.

MelchyBeau

04-09-2005, 11:17 AM

you are fairly wrong.

Debt can happen due to an emergency.

Also car debt isn't so bad depending. If you are on like a 24 month plan with 0% apr then thats not a problem.

My debt: $5 I owe someone at work for lunch

Melch

Paluka

04-09-2005, 12:07 PM

I think taking on some debt because you don't make a lot of money now but will be making a lot of money in the future is fine. You have to enjoy life. The people who read Rich Dad, Poor Dad or The Millionaire Next Door and think that those books describe lifestyles which will make someone happy are delusional. But there are limits to everything of course. Debt can be crippling, but there are times where it is worth it simply to make your life more enjoyable.

Lawrence Ng

04-09-2005, 12:22 PM

[ QUOTE ]

I think taking on some debt because you don't make a lot of money now but will be making a lot of money in the future is fine. You have to enjoy life. The people who read Rich Dad, Poor Dad or The Millionaire Next Door and think that those books describe lifestyles which will make someone happy are delusional. But there are limits to everything of course. Debt can be crippling, but there are times where it is worth it simply to make your life more enjoyable.

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Good post.

Lawrence

handsome

04-09-2005, 12:43 PM

[ QUOTE ]
I think taking on some debt because you don't make a lot of money now but will be making a lot of money in the future is fine. You have to enjoy life. The people who read Rich Dad, Poor Dad or The Millionaire Next Door and think that those books describe lifestyles which will make someone happy are delusional. But there are limits to everything of course. Debt can be crippling, but there are times where it is worth it simply to make your life more enjoyable.

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Yup. In economics this is called consumption smoothing, which explains why it's ok to pursue medicine or law or any other expensive education.