INTERESTING EXPERIMENT... try it, scare yourself!

PoundsLookAfterThemselves

Just to let you know that I’ve nominated this thread for the £50 Post of the Month Award. Thanks and Good Luck :T

2_litre

the problem comes when you want something ive found myself unemployed ive got 3 cards 2500 on one 2500 on another and 320 on another i got these while unemployed be skint have nothing but be debt free be skint in debt and have what you want whats the answer

EagerLearner

Good post and thatnks for doing the experiment - my ex maxed his 3 credit cards and his overdraft because he stuck his head in the sand on financial issues and was never happy, nothing was 'enough' so he had to buy more things. I think it was a gap he was filling but this is what most people suffer from - when they have things in their life that aren't what they'd like, they grab the card and buy something to get a fix and feel better.

It's not something that can be stopped with warnings sadly - we all get the temptation, it's just that some of us know when to stop and others keep going.

I think the UK is one of the easiest countries to get in debt - there's not a month that goes by where I don't get offered more credit limit, the government should step in with major legislation as people clearly can't do it for themselves, normally it's too late.

EagerLearner

super_mario_4

Heres another rather worrying calculation as well....



Mr X gets an credit card January 2006 and begins to overspend by £25 a week every week.

By the end off 2006, he has amassed £1200 of debt. However to service this debt he has to overspend by a further £160 over the course of the year taking his total debt to £1360. Then there is a further 15% interest to take into account which takes the total debt at the end of year one to £1564.

If he then carrys on overspending by £100 a month, paying 2% of the balance each month and paying 14.9% interest, this is how much his debt will APPROXIMATELY increase by.......


2007 - £1564
2008 - £3600
2009 - £6515
2010 - £10700
2011 - £16600
2012 - £25000
2013 - £37000
2014 - £54000
2015 - £78000
2016 - £112700
2017 - £162000

The_Boss

For Capital One's card, you only have to state your occupation, income and other household income. No proof of work address, phone number etc. Someone could just put down anything to ensure they got the card with a good limit. Very irresponsible IMO.

jesster_2

That's definitely the other thing: the increases in limits. It's one thing to say we don't need to warn people not to overspend, something else altogether to say 'why don't you go closer to the edge? look at the pretty things you can have! here... just go a little bit closer'... Which is what happens when they write to tell you they've increased your limit without you asking.

michaels

Yes the government must act - but I know for a fact that smoking and drinking cause more harm so lets ban those first as people can't trust themselves to know what's best for them - and while we are at it negative thoughts cause a lot of unhappiness so the government should start monitoring what we think andusing drugs and therapy to fix it if we do it wrong...

jesster_2

Hmmm... strange you should mention that...

Lois_Lane

The_Boss wrote:

For Capital One's card, you only have to state your occupation, income and other household income. No proof of work address, phone number etc. Someone could just put down anything to ensure they got the card with a good limit. Very irresponsible IMO.

Even if the credit card company takes details of your work address, they don't appear to check into its validity. I work for a very small company and I would know if a credit card company had contacted my employer to find out if the details provided were correct. I'm sometimes tempted to give false information just to see what would happen...!

Lois_Lane

jitsuguy wrote:

True,

But you have been taught how to drive and that driving into a tree would not be good for you or the car! Nobody gets taught personal finances today. But that may change in 10 years, as there is a GCSE starting up at certain schools aimed at teaching personal finance.

Jitsuguy

I disagree that nobody gets taught personal finance - I learned about managing money from my Dad, but things are different now to the way they were in his day so I've also learnt from other sources such as this website.

I taught both my children the importance of budgeting and saving and in my opinion it shouldn't be the responsibility of schools to do it - too many parents think their children are going to be taught all the life skills they need in school, when they have a role to play as well.

The problem is that people are constantly being bombarded by advertising and peer pressure and are convinced that its necessary to have the latest electronic gadgets and designer label clothes, and see credit as being the way to have what they want now, without always thinking about how short of spending money they will be when they've maxed out their credit card limit and have to make large minimum payments.