4 ms·

You didn't read the article, because just assuming X amount of money can work for anyone is not even remotely realistic. She owes $50,000 on her credit cards.

You didn't read the article, because just assuming X amount of money can work for anyone is not even remotely realistic. She owes $50,000 on her credit cards. Let's assume an 18% interest rate. The minimum she could pay to actually pay off the debt (just enough to even pay the interest) would be $765 per month (54% of her income), which would take 22 years and 1 month to pay off, with $152,024 paid in interest. She also has a $268 monthly loan payment for her aging rig. That means $1033 a month is going just to debt. And in my area, for someone getting on Medicare with no drug plan, for "original medicare", the estimated annual health and drug costs are $3,880. So after medicare costs and debt, how much is left for housing, food, transportation, and incidentals, per month? $60. She's clearly going to die before she can pay her debt off, so maybe just don't pay the debt and use the $825 total to help pay for housing, food, transportation, and incidentals, all of which are higher when you don't have a residence or stable income. You won't have any credit and the creditors will try whatever they can to come after you, and maybe you can dodge them for a few years until you die. Can you live off $825 a month? Yes. Will it be decent? Hell no. And if you have any major unexpected bills (such as emergency dental work and repairs on a rig, ballooning past $8000) you're fucked. Which, of course, happened.

rayiner 9y ago
> You didn't read the article, because just assuming X amount of money can work for anyone is not even remotely realistic But we’re talking about the public safety net here, and that’s exactly the assumption you have to make. She doesn’t need to pay her credit card debt. She can just declare bankruptcy. That’s the point of bankruptcy. She also doesn’t need a vehicle that costs as much as rent in small town America.
- peterwwillis 9y ago
  This is like the econ 101 assumptions. The public safety net is not designed for real people. If she could declare bankruptcy, don't you think she would have? She's 80, she has heard of the concept. The vehicle is her only shelter. Have you ever tried to pay rent with bad credit and no employment history? Not to mention, please show me a single place in all of the united states where rent is $268 per month and isn't a crack motel.
  - tptacek 9y ago
    What do you mean, "if" she can declare bankruptcy? She makes $10/hour part time and all her assets are in a trailer. She is obviously Chapter 7 eligible. You can rent a studio apartment in Chicago, in an apartment building (not a "crack motel"), for $350/mo. That's an apartment in the middle of a relatively expensive urban area. Clearly, there are non-crack-motel apartments that are significantly nicer than the Chicago apartment further afield.
    - peterwwillis 9y ago
      If some miracle allows for the debt and loan to disappear, there's just the $323 a month for medical (which is probably not spread out over time, and she would have no credit to buffer it, so she would need savings, which she doesn't have). In theory she could have $1093 to spend on rent, food, transportation and incidentals. But there are some requirements to file chapter 7: - First she needs to document all her financial records, which of course she has been doing in expectation of this point in her life - She needs to hire a bankruptcy lawyer, because otherwise she basically has to become her own lawyer and figure out her state/local bankruptcy laws and steps, which is very difficult for most people. - Non-exempt property, such as cash, a second car or car she doesn't use for work, is sold to pay the debt. Does an RV you live in count as a car you use for work? if not, there goes her home. - She has to get time off to go to the 341 meeting and do the mandatory credit counseling and debtor education classes and certification - Filing for bankruptcy costs between $1,400 and $4,000 on average in filing fees and other costs. - The whole process takes about six months on average, assuming everything works out. I would love to know how somebody who's living paycheck to paycheck and can barely afford milk and bread can accomplish this. Clearly there are obstacles that she may not be able to overcome. But I don't think anyone really cares about reality, looking at the way people in this thread are simply dismissing her using various theoretical devices to prove she simply isn't doing it right. If it were easy or simple to fix her life, she probably would have, because she is much more motivated to have a better life than random people on the internet. (Not that people not choosing to look at reality bothers me - it's people who do not fully understand the situation pretending that they know better that bothers me)
tptacek 9y ago
She can't pay back the credit cards. It is a grave mistake for her to even attempt it. Unfortunately, and I think particularly with norms and expectations from pre-gen-X (and pre-universal-financialization) culture, it's a mistake a lot of people make. It's tragic: these are people who need every dollar they make, shoveling enormous amounts of their capital into a black hole. In reality, attempting to service these debts prolongs their exposure. It's these sorts of bad decisions that I think Rayiner is referring to upthread. For someone in the financial situation the subject of this article is in, credit card debt should be off the table, full stop.

rayiner 9y ago

> You didn't read the article, because just assuming X amount of money can work for anyone is not even remotely realistic But we’re talking about the public safety net here, and that’s exactly the assumption you have to make. She doesn’t need to pay her credit card debt. She can just declare bankruptcy. That’s the point of bankruptcy. She also doesn’t need a vehicle that costs as much as rent in small town America.

peterwwillis 9y ago
This is like the econ 101 assumptions. The public safety net is not designed for real people. If she could declare bankruptcy, don't you think she would have? She's 80, she has heard of the concept. The vehicle is her only shelter. Have you ever tried to pay rent with bad credit and no employment history? Not to mention, please show me a single place in all of the united states where rent is $268 per month and isn't a crack motel.
- tptacek 9y ago
  What do you mean, "if" she can declare bankruptcy? She makes $10/hour part time and all her assets are in a trailer. She is obviously Chapter 7 eligible. You can rent a studio apartment in Chicago, in an apartment building (not a "crack motel"), for $350/mo. That's an apartment in the middle of a relatively expensive urban area. Clearly, there are non-crack-motel apartments that are significantly nicer than the Chicago apartment further afield.
  - peterwwillis 9y ago
    If some miracle allows for the debt and loan to disappear, there's just the $323 a month for medical (which is probably not spread out over time, and she would have no credit to buffer it, so she would need savings, which she doesn't have). In theory she could have $1093 to spend on rent, food, transportation and incidentals. But there are some requirements to file chapter 7: - First she needs to document all her financial records, which of course she has been doing in expectation of this point in her life - She needs to hire a bankruptcy lawyer, because otherwise she basically has to become her own lawyer and figure out her state/local bankruptcy laws and steps, which is very difficult for most people. - Non-exempt property, such as cash, a second car or car she doesn't use for work, is sold to pay the debt. Does an RV you live in count as a car you use for work? if not, there goes her home. - She has to get time off to go to the 341 meeting and do the mandatory credit counseling and debtor education classes and certification - Filing for bankruptcy costs between $1,400 and $4,000 on average in filing fees and other costs. - The whole process takes about six months on average, assuming everything works out. I would love to know how somebody who's living paycheck to paycheck and can barely afford milk and bread can accomplish this. Clearly there are obstacles that she may not be able to overcome. But I don't think anyone really cares about reality, looking at the way people in this thread are simply dismissing her using various theoretical devices to prove she simply isn't doing it right. If it were easy or simple to fix her life, she probably would have, because she is much more motivated to have a better life than random people on the internet. (Not that people not choosing to look at reality bothers me - it's people who do not fully understand the situation pretending that they know better that bothers me)

tptacek 9y ago

She can't pay back the credit cards. It is a grave mistake for her to even attempt it. Unfortunately, and I think particularly with norms and expectations from pre-gen-X (and pre-universal-financialization) culture, it's a mistake a lot of people make. It's tragic: these are people who need every dollar they make, shoveling enormous amounts of their capital into a black hole. In reality, attempting to service these debts prolongs their exposure. It's these sorts of bad decisions that I think Rayiner is referring to upthread. For someone in the financial situation the subject of this article is in, credit card debt should be off the table, full stop.