I said that painting a house couldn't be too hard. Famous last words. I don't think I had any idea what I was getting myself into. We started painting the porch yesterday, and I thought we could finish the whole thing before the end of the day, well, we got close but not finished. And that was only one porch. There are three. Our neighbor's son is going to paint the very high part of the eaves for me, and I didn't argue with them because, while I'm not afraid of heights, being sixteen feet up on a ladder isn't my idea of fun. Anyway, I think they offered to do that because we spent a week caulking everything really well, and so what they're paying us didn't consider all the caulking that needed to be done. At any rate, I'm about whooped after yesterday, I went to bed at 9pm and slept until 8am. On the bright side, I'd rather paint a house than work for a certain big-box-retailer-that-will-not-be-named. I'm not really sure that painting pays all that much better when you consider the hours put in, but I get to be outside.
Mamas, don't let your children grow up to be artists. Or at least not artists with massive amounts of student loans. It's not a good idea. It's easy to be an artist when you don't have Sallie Mae sleeping in your guest bedroom. We're working on kicking her out of our lives, it's just taking so long.
A flashback...
"This night will pass just like all the others." That's what I used to tell myself when I worked at a grocery store in high school. I really needed to grow a backbone then, and ought to have told those jerk faces to go to hell. They paid me minimum wage for two years, and I'm not entirely sure why I put up with them. The first two days on the job should have been a huge red flag. My drawer was short those first two days, and so I told my mother about it, wondering what I had done wrong with counting change. She asked me if I'd counted my drawer beforehand, and I'd said no. She said, 'you should always count your drawer before you start your shift.' The third day I demanded that it be counted before starting. It came up short by a lot.
Also, it's not like I liked working for them. I could have gotten a different job somewhere else that probably paid more, but I didn't. And looking back, I have no idea why. All that time wasted with assholes. The moral of this story? If you're not happy with things, then change them. Life is too short to be unhappy.
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Showing posts with label dave ramsey. Show all posts
Showing posts with label dave ramsey. Show all posts
Thursday, May 1, 2014
Thursday, March 6, 2014
It's the Debt, Stupid
I'm a big Dave Ramsey fan. Thanks to Dave, over the last year we have paid off our car and two of our small student loans. We still have two bigger loans that are going to take a while to pay off. Since I have a long drive to the college where I teach, I listen to Dave on the radio on the way there.
Something today clicked in my head while I was listening to his show. I'd known all of the facts for quite a while, but my brain hadn't put it together until now. Do you know why we are losing the middle class in this country? It's not the government, it's not that CEOs are making too much money, it's not a conspiracy theory (welllll...), it's not what the talking heads are telling you, it's not what you think. We are losing the middle class in this country because of debt. The middle class is up to their eyeballs in it. And when you're in debt, where is all your money going? It doesn't take a rocket scientist to figure it out! The American middle class has blamed the banks for the housing bust and Wall Street for a crappy economy. It's kinda like blaming the Grand Canyon for being a big hole in the ground. You're missing the real culprit. The Grand Canyon is a huge hole in the ground because the Colorado River running through it made it that way, much the same way that the middle class is becoming impoverished, being worn away, because of their embracing of debt.
Debt is not a tool. Paying hundreds, thousands, tens of thousands a year in INTEREST to the BANKS is not a useful tool. It makes you a tool maybe. But it is not one. This acceptance of debt is fairly new. Our ancestors didn't do it, because you could go to debtors' prison if you didn't pay. Our parents didn't do it either, even though debtors' prison was long since gone. Back when my parents were young, you couldn't get a credit card unless you had a very high income, beyond what the middle class made on average. You couldn't get a mortgage unless you had 20% down and a steady job for three years. Student loans were only for certain programs. There was no way you could possibly live beyond your means. No one would loan you the money to do it.
Fast forward to the nineties, and cheap and easy credit is everywhere. You can run up all kinds of debt. You can get a car loan, a house loan, a second mortgage, hell why not a third mortgage, a student loan, enough credit cards to fill in the Grand Canyon, and if you hit the limit, don't worry, the bank will raise your limit (especially if they're a predatory lender). Eventually, you over-extend yourself, and they raise your interest rates, and now a large portion of your income is going to the banks. You apply for more credit cards to cover the shortfall in your income, and then eventually you wind up filing bankruptcy. But it doesn't end there. After you file bankruptcy, you can get yourself right back into the same mess again. You'll get credit card offers in the mail almost immediately, and they'll give you more credit. Isn't that brilliant?
And the crazy thing is, that this mentality of debt being acceptable has worked its way so thoroughly into the psyche of the middle class (and even the so-called working poor), that they don't care how much interest they are paying, just tell them what the payments are and they'll see if they can squeeze it into the amount that they are capable of paying out each month. A good example of this is the conversation I had with one of my students. He said he was going to go buy a used car that cost probably about the same as what he makes in a year. He had no idea what the interest rate was going to be (it's usually very high on a used car). All he knew was that the payments were affordable. I tried to talk him out of it, but he didn't understand what the problem was. After all, he said he could make the payments with no problem. The idea of saving up and buying a car outright was a foreign concept. Another student told me she had no problem making payments on a bedroom set and some other furniture because, "the payments aren't much." The rich are getting richer because they're investing their money. The poor are getting poorer because they're giving all of their disposable income to the banks!
Debt has allowed the majority of the middle class to live beyond their means and give a hefty percentage of their income to the banks. If you're in debt, add up what you're paying in interest every year. And then go stick that number into a mutual fund calculator with returns showing thirty or so years. Try not to cry. As is so often true in life, if you want to know where the blame lies, go look in the mirror.
Something today clicked in my head while I was listening to his show. I'd known all of the facts for quite a while, but my brain hadn't put it together until now. Do you know why we are losing the middle class in this country? It's not the government, it's not that CEOs are making too much money, it's not a conspiracy theory (welllll...), it's not what the talking heads are telling you, it's not what you think. We are losing the middle class in this country because of debt. The middle class is up to their eyeballs in it. And when you're in debt, where is all your money going? It doesn't take a rocket scientist to figure it out! The American middle class has blamed the banks for the housing bust and Wall Street for a crappy economy. It's kinda like blaming the Grand Canyon for being a big hole in the ground. You're missing the real culprit. The Grand Canyon is a huge hole in the ground because the Colorado River running through it made it that way, much the same way that the middle class is becoming impoverished, being worn away, because of their embracing of debt.
Debt is not a tool. Paying hundreds, thousands, tens of thousands a year in INTEREST to the BANKS is not a useful tool. It makes you a tool maybe. But it is not one. This acceptance of debt is fairly new. Our ancestors didn't do it, because you could go to debtors' prison if you didn't pay. Our parents didn't do it either, even though debtors' prison was long since gone. Back when my parents were young, you couldn't get a credit card unless you had a very high income, beyond what the middle class made on average. You couldn't get a mortgage unless you had 20% down and a steady job for three years. Student loans were only for certain programs. There was no way you could possibly live beyond your means. No one would loan you the money to do it.
Fast forward to the nineties, and cheap and easy credit is everywhere. You can run up all kinds of debt. You can get a car loan, a house loan, a second mortgage, hell why not a third mortgage, a student loan, enough credit cards to fill in the Grand Canyon, and if you hit the limit, don't worry, the bank will raise your limit (especially if they're a predatory lender). Eventually, you over-extend yourself, and they raise your interest rates, and now a large portion of your income is going to the banks. You apply for more credit cards to cover the shortfall in your income, and then eventually you wind up filing bankruptcy. But it doesn't end there. After you file bankruptcy, you can get yourself right back into the same mess again. You'll get credit card offers in the mail almost immediately, and they'll give you more credit. Isn't that brilliant?
And the crazy thing is, that this mentality of debt being acceptable has worked its way so thoroughly into the psyche of the middle class (and even the so-called working poor), that they don't care how much interest they are paying, just tell them what the payments are and they'll see if they can squeeze it into the amount that they are capable of paying out each month. A good example of this is the conversation I had with one of my students. He said he was going to go buy a used car that cost probably about the same as what he makes in a year. He had no idea what the interest rate was going to be (it's usually very high on a used car). All he knew was that the payments were affordable. I tried to talk him out of it, but he didn't understand what the problem was. After all, he said he could make the payments with no problem. The idea of saving up and buying a car outright was a foreign concept. Another student told me she had no problem making payments on a bedroom set and some other furniture because, "the payments aren't much." The rich are getting richer because they're investing their money. The poor are getting poorer because they're giving all of their disposable income to the banks!
Debt has allowed the majority of the middle class to live beyond their means and give a hefty percentage of their income to the banks. If you're in debt, add up what you're paying in interest every year. And then go stick that number into a mutual fund calculator with returns showing thirty or so years. Try not to cry. As is so often true in life, if you want to know where the blame lies, go look in the mirror.
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