5 ms·

Spending money you don't have is being financially irresponsible, regardless of whether it's through credit cards or some other equivalent. However, the financ

Spending money you don't have is being financially irresponsible, regardless of whether it's through credit cards or some other equivalent. However, the financially irresponsible tend to blame the tool (eg credit cards) rather than becoming more responsible, and, in the case of this article, Gen Z seemed to have fallen prey to a similar tool but with a newer name.

7e 4y ago
Ah yes. “Guns don’t kill people, people do.” This ignores the morality of predatory behavior and enablement.
- ekianjo 4y ago
  individual agency is still a thing no matter what.
  - schlauerfox 4y ago
    then why do they spend so much on advertising. You're being reductive and enabling.
    - ekianjo 4y ago
      Advertising only works on a minority of people who are naive. The other goal of advertising is to generate awareness. The more you teach people about the influence of ads the more agency they gain.
Bilal_io 4y ago
Precisely, I only have and use a credit card to maintain my credit score. I don't max i as I don't spend more than two-figure to keep it active then I pay it within 3 days. The system is designed to obligate people to use credit, and I can see how tempting and easy it is for someone that lives paycheck to paycheck to use their credit card and carry balance. Edit: I wanted to add. News websites have a habit of blaming gen z for all the different issues but forget to blame the system. Gen z is poorer than previous generations, and that should be highlighted everytime they're blamed
- darthrupert 4y ago
  Every individual success and failure is systemic because individuals are molded by the system. Blaming individuals could be seen as an attempt to fix the system from the bottom. Fixing the system from the top probably works better for the future, but the current generation cannot be helped like that.
- jemmyw 4y ago
  > News websites have a habit of blaming gen z for all the different issues They used to blame millennials. It's amazing how little introspection media outlets have.
- alkonaut 4y ago
  Credit scores based on credit card use seems fundamentally broken. Having had a good salary and paid all your bills on time for decades should of course count as being financially responsible and creditworthy. Luckily I think only the US has this system?
  - Bilal_io 4y ago
    > Credit scores based on credit card use seems fundamentally broken. The thing that makes me angry is that I am not interested in their money, credit is still needed even when installing internet at my home (looking at you AT&T), where the bill could be prepaid instead, but they could still reject you and charge a high deposit. It's beyond ridiculous. > I think only the US has this system? I think so. And I hope no one gets "inspired" thinking the US is perfect and copies the same system in their country.
noobermin 4y ago
Why do you need to victim blame? You wouldn't victim blame in worse situations like murder or rape (he was murdered because he didn't teach himself self defense, or she was raped because she wore provocative clothing) so why victim blame here? Reserving some critique for the perpetrator is generalizable to more benign crimes too, and it's only fair.
- anon291 4y ago
  Except murder is always illegal and immoral. Taking someone's money is only illegal and unethical if they did not consent. Huge difference
  - xracy 4y ago
    I am a Nigerian Prince, and I'm about to come into some wealth, but in order to access these millions of dollars, I need you to give me a small amount. ($10k) If you do, in exchange for your kindness and help unlocking my assets, I will immediately pay back your investment at 10x ($100k). People consent to giving people their money all the time, and it is still illegal and immoral if the person offering deceived them. OR maybe you're a phisher and you think there's nothing wrong with phishing...
    - anon291 4y ago
      If you told me youre a Nigerian who made himself a prince crown and made himself a prince, then yes the situation is comparable Ftx claimed a token they made up had value and it didn't. Everyone knew the token was made up
- AvesMerit 4y ago
  Victims are not always blameless. In this instance, victims are well informed about the consequences of borrowing & choose to consent. One could even argue that creditors who do not get paid are victims - they're the ones who provided funds to the borrower for them to enjoy their goods Obviously, one should not blame a murder/rape victim
moonchrome 4y ago
> Spending money you don't have is being financially irresponsible, regardless of whether it's through credit cards or some other equivalent. Meh - I've spent money I didn't have when I was younger - life is short, what was a lot of money back then is irrelevant to me now and that's expected (you earn more the further you go in your career). I can't go back to twenties now no matter how much I saved back then.
rapind 4y ago
> Spending money you don't have... You basically just described loans. So the mortgage industry. I'm not looking forward to bailing people or companies out for being irresponsible again (referring to 2008 housing, I'm fine with student loan forgiveness).
- Spivak 4y ago
  I don't think I really disagree with this. Mortgages are so unbelievably stupid and if they weren't the norm wouldn't be invented again. The people taking out mortgages have no idea if they'll have stable income for 15 or 30 years because such a thing is impossible. So long as your ability to pay your mortgage is tied to your ability to work you have no guarantees at all.
  - jahewson 4y ago
    That is what mortgage insurance is for.
  - crgwbr 4y ago
    So how do you propose anyone ever buys a house, then? Waste money on rent whilst saving for 30 years so they can finally buy a house in cash at age 50? A modestly sized mortgage seems better than that.
    - Spivak 4y ago
      You’re either gonna be wasting money on rent or interest and interest rates are so bad you might be better off with rent. I found a 450k home near me on Zillow. If I put 20% down today with a 30 year mortgage, include property taxes, home owner’s insurance and the $100/mo hoa fee I will spend $550k in interest, $210k in property taxes, $30k in hoa fees and $60k in homeowners insurance or $850k of money that isn’t equity over the lifetime of the loan. My rent is $1400/mo in the same area. Let’s make it $2k to account for some inflation. I will spend $720k over 30 years and all my “equity” actually pays because it’s in the market and not my roof. But wait that’s not at all realistic. I want to own a house! If me and my partner can save 5k/mo (which is actually low since that mortgage was gonna cost us 3.7k a month and be at most 30% of our cash flow) we can buy cash in about 8 years. So we spend $192k in rent to get $450k of equity or we spend $550k to do the same. And this isn’t theoretical either. I’m two years and 130k into this process. I would be further but I had to eat a high six figure medical bill which thankfully didn’t financially ruin me and cost nothing setting my clock back. And if that isn’t the biggest endorsement of this strategy I don’t know what is.
pyrophane 4y ago
> Spending money you don't have is being financially irresponsible, regardless of whether it's through credit cards or some other equivalent. Hmmmm... spending money you don't have is how modern economies work, to a great extent. Companies take out loans to fund investment when cost of capital makes sense. People take out mortgages to buy homes. > However, the financially irresponsible tend to blame the tool (eg credit cards) rather than becoming more responsible, and, in the case of this article, Gen Z seemed to have fallen prey to a similar tool but with a newer name. Well, there is a certain class of loan products that preys on people who don't deeply understand how our financial system works. That understanding only comes from experience. How much can you truly blame someone when the "tool" is designed in such a way to take advantage of them. Lenders obscure the cost/risk, use advertising to make it seem like free money, etc. They target young people, because they are the ones most vulnerable to such tactics, and they can probably work for a long time, so you can make a ton of interest odd them, especially with the current bankruptcy laws.
- sieabahlpark 4y ago
- bruce511 4y ago
  >> Hmmmm... spending money you don't have is how modern economies work, to a great extent. Companies take out loans to fund investment when cost of capital makes sense. People take out mortgages to buy homes. I think it's worth distinguishing between different kinds of debt here. The article is discussing consumer debt (caused by consumption). The debt you are referring to is capital-debt, ie debt incurred to purchase an asset (which could be resold) or used to build an income. Consumer debt is typically bad, and asset debt is typically good But your point is not wrong. Western economies are largely fueled by consumer debt. If consumers all spent according to their means, and saved as much as they could, the effects on the "economy" (which is literally the "movement of money") would be devastating.
hotpotamus 4y ago
What if it's spending incurred by a trip to the emergency room?
- Spivak 4y ago
  This is going to sound stupid, but the real advice is that if you don't have the money to pay your ER bill just don't pay it. The hospital can and will wait, offer you a lower bill, send it to collections where you can negotiate lower than that. Don't take on debt to pay debt.
  - hotpotamus 4y ago
    I have no illusions that this debt will be paid (I have perpetually uninsured friends - one even says he just gives a fake name at the ER), but the debt is incurred anyway.
Loveaway 4y ago
It's unethical to offer much credit to young people though. Many around ~20 don't have a sense for financial responsibility yet, and will rack up debt without being aware of the consequences. Banks & Co. couldn't care less though, a young person in debt will have all its life to pay up, so why not just shower them in money.
- schlauerfox 4y ago
  Then banks are deeply unethical if my college campus is any gauge with tshirt giveaways for signups with cool young people smooth talking the freshmen. Not to mention the student loan industry cruelty.
jahewson 4y ago
The financially responsible move of course being to call that debt a “mortgage” and then spend the rest of your life stifling all attempts to build more housing.
xboxnolifes 4y ago
I'd add a small caveat that it's irresponsible to buy liabilities with money you don't have. Buying appreciating assets with money you don't have is how our entire economy is based around, and is also what all of the rich people do.
- bruce511 4y ago
  I completely agree. With the proviso that the economy also revolves around the existance of consumer debt, and the willingness of huge numbers of people to squander it.
xracy 4y ago
you pay for everything in cold hard cash? Never used a credit card before? Why are credit cards regulated pretty strictly for this, but these loans aren't? That doesn't sound like personal responsibility to me... that sounds like regulation doing its job...

7e 4y ago

Ah yes. “Guns don’t kill people, people do.” This ignores the morality of predatory behavior and enablement.

ekianjo 4y ago
individual agency is still a thing no matter what.
- schlauerfox 4y ago
  then why do they spend so much on advertising. You're being reductive and enabling.
  - ekianjo 4y ago
    Advertising only works on a minority of people who are naive. The other goal of advertising is to generate awareness. The more you teach people about the influence of ads the more agency they gain.

Bilal_io 4y ago

Precisely, I only have and use a credit card to maintain my credit score. I don't max i as I don't spend more than two-figure to keep it active then I pay it within 3 days. The system is designed to obligate people to use credit, and I can see how tempting and easy it is for someone that lives paycheck to paycheck to use their credit card and carry balance. Edit: I wanted to add. News websites have a habit of blaming gen z for all the different issues but forget to blame the system. Gen z is poorer than previous generations, and that should be highlighted everytime they're blamed

darthrupert 4y ago
Every individual success and failure is systemic because individuals are molded by the system. Blaming individuals could be seen as an attempt to fix the system from the bottom. Fixing the system from the top probably works better for the future, but the current generation cannot be helped like that.
jemmyw 4y ago
> News websites have a habit of blaming gen z for all the different issues They used to blame millennials. It's amazing how little introspection media outlets have.
alkonaut 4y ago
Credit scores based on credit card use seems fundamentally broken. Having had a good salary and paid all your bills on time for decades should of course count as being financially responsible and creditworthy. Luckily I think only the US has this system?
- Bilal_io 4y ago
  > Credit scores based on credit card use seems fundamentally broken. The thing that makes me angry is that I am not interested in their money, credit is still needed even when installing internet at my home (looking at you AT&T), where the bill could be prepaid instead, but they could still reject you and charge a high deposit. It's beyond ridiculous. > I think only the US has this system? I think so. And I hope no one gets "inspired" thinking the US is perfect and copies the same system in their country.

noobermin 4y ago

Why do you need to victim blame? You wouldn't victim blame in worse situations like murder or rape (he was murdered because he didn't teach himself self defense, or she was raped because she wore provocative clothing) so why victim blame here? Reserving some critique for the perpetrator is generalizable to more benign crimes too, and it's only fair.

anon291 4y ago
Except murder is always illegal and immoral. Taking someone's money is only illegal and unethical if they did not consent. Huge difference
- xracy 4y ago
  I am a Nigerian Prince, and I'm about to come into some wealth, but in order to access these millions of dollars, I need you to give me a small amount. ($10k) If you do, in exchange for your kindness and help unlocking my assets, I will immediately pay back your investment at 10x ($100k). People consent to giving people their money all the time, and it is still illegal and immoral if the person offering deceived them. OR maybe you're a phisher and you think there's nothing wrong with phishing...
  - anon291 4y ago
    If you told me youre a Nigerian who made himself a prince crown and made himself a prince, then yes the situation is comparable Ftx claimed a token they made up had value and it didn't. Everyone knew the token was made up
AvesMerit 4y ago
Victims are not always blameless. In this instance, victims are well informed about the consequences of borrowing & choose to consent. One could even argue that creditors who do not get paid are victims - they're the ones who provided funds to the borrower for them to enjoy their goods Obviously, one should not blame a murder/rape victim

moonchrome 4y ago

> Spending money you don't have is being financially irresponsible, regardless of whether it's through credit cards or some other equivalent. Meh - I've spent money I didn't have when I was younger - life is short, what was a lot of money back then is irrelevant to me now and that's expected (you earn more the further you go in your career). I can't go back to twenties now no matter how much I saved back then.

rapind 4y ago

> Spending money you don't have... You basically just described loans. So the mortgage industry. I'm not looking forward to bailing people or companies out for being irresponsible again (referring to 2008 housing, I'm fine with student loan forgiveness).

Spivak 4y ago
I don't think I really disagree with this. Mortgages are so unbelievably stupid and if they weren't the norm wouldn't be invented again. The people taking out mortgages have no idea if they'll have stable income for 15 or 30 years because such a thing is impossible. So long as your ability to pay your mortgage is tied to your ability to work you have no guarantees at all.
- jahewson 4y ago
  That is what mortgage insurance is for.
- crgwbr 4y ago
  So how do you propose anyone ever buys a house, then? Waste money on rent whilst saving for 30 years so they can finally buy a house in cash at age 50? A modestly sized mortgage seems better than that.
  - Spivak 4y ago
    You’re either gonna be wasting money on rent or interest and interest rates are so bad you might be better off with rent. I found a 450k home near me on Zillow. If I put 20% down today with a 30 year mortgage, include property taxes, home owner’s insurance and the $100/mo hoa fee I will spend $550k in interest, $210k in property taxes, $30k in hoa fees and $60k in homeowners insurance or $850k of money that isn’t equity over the lifetime of the loan. My rent is $1400/mo in the same area. Let’s make it $2k to account for some inflation. I will spend $720k over 30 years and all my “equity” actually pays because it’s in the market and not my roof. But wait that’s not at all realistic. I want to own a house! If me and my partner can save 5k/mo (which is actually low since that mortgage was gonna cost us 3.7k a month and be at most 30% of our cash flow) we can buy cash in about 8 years. So we spend $192k in rent to get $450k of equity or we spend $550k to do the same. And this isn’t theoretical either. I’m two years and 130k into this process. I would be further but I had to eat a high six figure medical bill which thankfully didn’t financially ruin me and cost nothing setting my clock back. And if that isn’t the biggest endorsement of this strategy I don’t know what is.

pyrophane 4y ago

> Spending money you don't have is being financially irresponsible, regardless of whether it's through credit cards or some other equivalent. Hmmmm... spending money you don't have is how modern economies work, to a great extent. Companies take out loans to fund investment when cost of capital makes sense. People take out mortgages to buy homes. > However, the financially irresponsible tend to blame the tool (eg credit cards) rather than becoming more responsible, and, in the case of this article, Gen Z seemed to have fallen prey to a similar tool but with a newer name. Well, there is a certain class of loan products that preys on people who don't deeply understand how our financial system works. That understanding only comes from experience. How much can you truly blame someone when the "tool" is designed in such a way to take advantage of them. Lenders obscure the cost/risk, use advertising to make it seem like free money, etc. They target young people, because they are the ones most vulnerable to such tactics, and they can probably work for a long time, so you can make a ton of interest odd them, especially with the current bankruptcy laws.

sieabahlpark 4y ago
bruce511 4y ago
>> Hmmmm... spending money you don't have is how modern economies work, to a great extent. Companies take out loans to fund investment when cost of capital makes sense. People take out mortgages to buy homes. I think it's worth distinguishing between different kinds of debt here. The article is discussing consumer debt (caused by consumption). The debt you are referring to is capital-debt, ie debt incurred to purchase an asset (which could be resold) or used to build an income. Consumer debt is typically bad, and asset debt is typically good But your point is not wrong. Western economies are largely fueled by consumer debt. If consumers all spent according to their means, and saved as much as they could, the effects on the "economy" (which is literally the "movement of money") would be devastating.

hotpotamus 4y ago

What if it's spending incurred by a trip to the emergency room?

Spivak 4y ago
This is going to sound stupid, but the real advice is that if you don't have the money to pay your ER bill just don't pay it. The hospital can and will wait, offer you a lower bill, send it to collections where you can negotiate lower than that. Don't take on debt to pay debt.
- hotpotamus 4y ago
  I have no illusions that this debt will be paid (I have perpetually uninsured friends - one even says he just gives a fake name at the ER), but the debt is incurred anyway.

Loveaway 4y ago

It's unethical to offer much credit to young people though. Many around ~20 don't have a sense for financial responsibility yet, and will rack up debt without being aware of the consequences. Banks & Co. couldn't care less though, a young person in debt will have all its life to pay up, so why not just shower them in money.

schlauerfox 4y ago
Then banks are deeply unethical if my college campus is any gauge with tshirt giveaways for signups with cool young people smooth talking the freshmen. Not to mention the student loan industry cruelty.

jahewson 4y ago

The financially responsible move of course being to call that debt a “mortgage” and then spend the rest of your life stifling all attempts to build more housing.

xboxnolifes 4y ago

I'd add a small caveat that it's irresponsible to buy liabilities with money you don't have. Buying appreciating assets with money you don't have is how our entire economy is based around, and is also what all of the rich people do.

bruce511 4y ago
I completely agree. With the proviso that the economy also revolves around the existance of consumer debt, and the willingness of huge numbers of people to squander it.

xracy 4y ago

you pay for everything in cold hard cash? Never used a credit card before? Why are credit cards regulated pretty strictly for this, but these loans aren't? That doesn't sound like personal responsibility to me... that sounds like regulation doing its job...