21 Sep 2014
As a new wave of fresh-faced, financially-uneducated teens hit UK and US colleges this week, banks will be falling over themselves to offer incentives to new students to sign up for bank accounts, overdrafts and credit cards: they know that once you’re in the debt cycle you’re hooked, and it’s better to grab ‘em young because people rarely switch banks.
As a result, I was particularly interested to read CashCowCouple’s article, “For Half of Americans, Only One Interest Rate Matters”: their double-digit consumer debt. With so many people seemingly determined to live beyond their means, and with mindless, off-the-charts spending and a fundamental lack of financial education across the board about the way credit cards work and the way interest payments mount up to trap you in the debt spiral, how are people ever supposed to find their way out? The post includes some scary figures and offers suggestions about how to climb out of the hole instead of digging yourself further in… well worth the read!
Similarly, I found Erin Lowry’s article (aka Broke Millennial) about why Milliennials need credit cards interesting, particularly since I’m from the UK so it’s interesting to read the perspective of someone who lives in the US: while there is certainly a lot of room for abuse and rapidly getting yourself into unmanageable debt with credit cards if you’re not disciplined, there is no doubt that they are extremely useful and when used correctly they can greatly improve your credit score. The only question in my mind is whether or not the younger generation can be educated to use credit cards properly, rather than allowing themselves to get deeper and deeper into debt.
Finally, Eli Inkrot wrote a very poignant post on The Money Principle discussing the true significance of money in our lives, namely how it buys us time to do the things we love: Time is Love.
I think it’s a brilliantly crafted piece and he isn’t nearly getting the love he deserves, so head over to his blog, The Currency of Time, and subscribe NOW!
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Till next week…