Heartlander · 80-89, M
It has a history.
Our parents used a system called “lay away” where the store took the product off the shelf and held it while the purchaser made periodic small payments. Once the item was fully paid the store gave the product to the customer. The general understanding was that a purchased item didn’t belong to the buyer until it was paid for. While there was credit, it was the store itself that granted the credit, not the bank or finance company. I recall from parents and grandparents that when purchased on credit they refrained from wearing or using the item until the bill was paid, a sort of self imposed lay away plan.
All that changed when credit cards appeared.
Our parents used a system called “lay away” where the store took the product off the shelf and held it while the purchaser made periodic small payments. Once the item was fully paid the store gave the product to the customer. The general understanding was that a purchased item didn’t belong to the buyer until it was paid for. While there was credit, it was the store itself that granted the credit, not the bank or finance company. I recall from parents and grandparents that when purchased on credit they refrained from wearing or using the item until the bill was paid, a sort of self imposed lay away plan.
All that changed when credit cards appeared.
Rob04 · 18-21, M
@Heartlander Thanks for this History.
NinaCherry · 26-30, F
@Heartlander I recall from parents and grandparents that when purchased on credit they refrained from wearing or using the item until the bill was paid, a sort of self imposed lay away plan.
Oh wow that Must have Costed willpower
Oh wow that Must have Costed willpower
Heartlander · 80-89, M
@NinaCherry This was small town America, maybe even not so small town America. I think the logic was that if you like bought a suit on credit and the store owner carried the credit, the buyer didn’t want to be seen wearing the suit if the bill hadn’t yet been paid; after all, the store owner may have needed that money to pay their workers or to feed their family.
Realize this was in the shadow of the Great Depression, a time when failures to pay ones bill had serious consequences for the persons left holding the bag.
As a kid, I remember my parents hesitating to let other family know about new cars or other big purchases. They were worried about what other family members would think.
A good friends dad was a dentist who bought a Cadillac. The dad kept the car hidden in the garage and only drove it at night, fearing that his patients would see it and think they were being overcharged for their dental visits. So different today, my dentist drives a big BMW and parks it near his clinics front door.
Realize this was in the shadow of the Great Depression, a time when failures to pay ones bill had serious consequences for the persons left holding the bag.
As a kid, I remember my parents hesitating to let other family know about new cars or other big purchases. They were worried about what other family members would think.
A good friends dad was a dentist who bought a Cadillac. The dad kept the car hidden in the garage and only drove it at night, fearing that his patients would see it and think they were being overcharged for their dental visits. So different today, my dentist drives a big BMW and parks it near his clinics front door.
Strongtea · 22-25, M
There’s nothing wrong with it, I’ve had a credit card since I was 18. My mum and dad help me to pay it if I can’t, but I try to not spend huge amounts.
Adeptlinguist · M
No shame at all.
But you need to be careful that it doesn’t get out of control. There is no fun to be had in being neck-deep in debt you can’t repay - that can ruin your life.
But you need to be careful that it doesn’t get out of control. There is no fun to be had in being neck-deep in debt you can’t repay - that can ruin your life.
NerdyPotato · M
If you can't afford it now, there's no guarantee you can afford it when payment is due.
CrazyMusicLover · 31-35
The problem I have with buying on loan is that this behaviour pushes prices up because sellers know people are willing to spend above their means. It puts people who only want to pay with money they have into disadvantage. Maybe it's not such a problem with credit cards but it's definitely a problem with mortgages and prices of properties.
Heartlander · 80-89, M
@CrazyMusicLover An interesting note is that there is very little credit used on the wholesale side of businesses. Like in many industries it's cash on delivery, or cash within 24 hours. The demand of retailers to buy wholesale at the lowest price possible has over the years stripped credit sales to practically zero.
Paliglass · 41-45, F
It's a personal choice thing. The problem alot with it is that you pay back more than it's worth especially as things depreciate in value over time. As soon as you buy a car/couch the monetary value of it drops significantly so then you're not left only paying more than what it was worth after you bought it but more than what it was worth before you bought it. Say a couch is 1000 and after you buy it it's 500 because now it's second hand but you're paying 1500 for it. Could be as much as 2000 if you've got really bad credit. Perhaps with good credit 1300 but it's still 800 more than what it is worth immediately after you bought it.
That's the problem people have with it I guess.
The problem I personally have with it is the instant gratification. Instead of saving and waiting there's instant gratification. We're like mice drinking cocaine water scurrying back for another hit of something new. Buying new things to constantly get a high. We buy things we don't need blah blah and there really is a freedom in needing less
But it's all down to individual choice and perspective. I don't like it, doesn't mean other people can't enjoy it.
That's the problem people have with it I guess.
The problem I personally have with it is the instant gratification. Instead of saving and waiting there's instant gratification. We're like mice drinking cocaine water scurrying back for another hit of something new. Buying new things to constantly get a high. We buy things we don't need blah blah and there really is a freedom in needing less
But it's all down to individual choice and perspective. I don't like it, doesn't mean other people can't enjoy it.
Rob04 · 18-21, M
@Paliglass Problem with deferred gratification is the item is gone so get the next best preferred one. Prices go up so if you saved 600 it's now 780 (catching up to do, but now thas a 180 only loan for the more instead of 600)!
Depreciation in value, cars are the biggest culprits so people buy new one in part exchange deal. Again, paid off loan for one now u got probably another 4 years to pay for new car, only half / fraction of the price. More u delay part ex, more the value of your car goes down.
Depreciation in value, cars are the biggest culprits so people buy new one in part exchange deal. Again, paid off loan for one now u got probably another 4 years to pay for new car, only half / fraction of the price. More u delay part ex, more the value of your car goes down.
JamesBugman · 56-60, T
Balancing your finances means you have money to spare. When you start buying on credit you are in the hole, so say if you lose your job suddenly, you could have that item repossessed because you are unable to meet the repayment requirement.
Lots of people lose their cars this way, they make TV shows about it.
So if you can pay cash for something, you are better off, but sometimes it is nice to take a chance and get that item right away. It forces you to commit to it.. like a home.. almost nobody could afford a home without a mortgage, except maybe Musk who hordes money, and Trump who revels in stealing it.
Lots of people lose their cars this way, they make TV shows about it.
So if you can pay cash for something, you are better off, but sometimes it is nice to take a chance and get that item right away. It forces you to commit to it.. like a home.. almost nobody could afford a home without a mortgage, except maybe Musk who hordes money, and Trump who revels in stealing it.
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JamesBugman · 56-60, T
@SW-User That doesn't sound like a very smart investment for the lender. lol
SW-User
@JamesBugman It's the way it is
Heartlander · 80-89, M
@WonderGirl Great ... it's a way for banks to increase business for themselves and attract dependable customers. Customer loyalty is a valued 'off the books' asset for businesses.
Also, be careful with such arrangements, because the penalty for just one late payment may be extreme, like it may lead to forfeiture of all the benefits that you think you accumulated. Like all the interest that you didn't pay will suddenly become due.
Also, be careful with such arrangements, because the penalty for just one late payment may be extreme, like it may lead to forfeiture of all the benefits that you think you accumulated. Like all the interest that you didn't pay will suddenly become due.
@Heartlander that's the whole point of it make all the payments on time
Heartlander · 80-89, M
@WonderGirl Yep. Similar cautions on front end discounts. Like first month or two rent free when signing a lease agreement.
PDXNative1986 · 36-40, MVIP
it's not the worst option in the world, but buying anything with plastic has hidden cost - about 3% right off the top for every transaction the seller has to pay to be able to process a payment, which ends up coming back to the consumer. then the rate you have to pay for interest on the purchase (since you did specifically mention 'things u could not immediately afford' - if you're paying it off before interest kicks in, you're either playing finance games that are shaving too close or you could have afforded it immediately. ), any credit card rewards you get are well offset by the 3% increase in base price, and all of it tends to put people into a 'get it now, paying for it is something future you has to worry about' mindset that can lead to some very difficult to recover from problems.
SW-User
@WonderGirl My cousins took a 1000 dollars off me for a vehicle that was a piece of junk now I'm stuck.
JamesBugman · 56-60, T
@SW-User Can't expect much for a 1K car. Like with boats, the most expensive ones are free.
SW-User
@JamesBugman I was promised to be paid back
Pfuzylogic · M
NinaCherry · 26-30, F
@Pfuzylogic sarcasm??
Pfuzylogic · M
@NinaCherry
No…I take you as being serious here. When I taught High School and started at 18k and within 10 years it was 54k so a credit purchase would make sense.
No…I take you as being serious here. When I taught High School and started at 18k and within 10 years it was 54k so a credit purchase would make sense.
Pfuzylogic · M
@NinaCherry To respond to your request, I did buy a brand new car on my first year of teaching. If my income didn’t increase I would not have been able to afford my LeBaton Coupe but credit allowed me to buy it right away!
Fertilization · 36-40, F
eMortal · M
Take credit to buy a property or to expand your company. That's essentially using someone else's money to make money.
YoMomma ·
Idk about wrong just it's not the most efficient way to buy things because you pay a lot of interest..
SinlessOnslaught · M
Just be responsible about it and it's a luxury.
TheShanachie · 61-69, M
If you don’t you’ll never have anything.
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NinaCherry · 26-30, F
@WolfGirlwh0r3 yeah so people are abusing this system but the concept is great
WolfGirlwh0r3 · 36-40, T
@NinaCherry OH hell yeah the program of using credit to buy things you cant afford in full right away is amazing, BUTT the banks give credit to those they know cant afford to pay it back to keep them indentured for life!
NinaCherry · 26-30, F
well what do the banks gain from not getting their money back lol
but a lot of people do fall in problems with their debt which is i guess why it has such a bad reputation. but i like this concept. i personally i dont do loans because i dont trust myself to be paying it regularly or i am afraid i will fall on hard times
but a lot of people do fall in problems with their debt which is i guess why it has such a bad reputation. but i like this concept. i personally i dont do loans because i dont trust myself to be paying it regularly or i am afraid i will fall on hard times
Nothing, assuming you can afford to pay off the credit bill.
Otherwise the credit cards will kill you with extremely high interest rates.
Otherwise the credit cards will kill you with extremely high interest rates.
cut your dress according to your cloth
DonaldTrumpet · 70-79, M
WimenZ makes meNz pay der BiLLz
SimPz pay, SmarTz MeNz donTz
SimPz pay, SmarTz MeNz donTz
Rob04 · 18-21, M
Justenjoyit · 61-69, M
If if can find a deal where the company is selling things for interest free credit thats good, otherwise check the interest rate for taking out the credit.
AthrillatheHunt · 51-55, M
it makes you a slave to your creditors
FeetAreFantastic · 41-45, M
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