Financial Responsibility (Part 2)

I’ve ranted about financial responsibility before, but that was over two years ago, and I think it’s about that time again.

I frequent the personal finance subreddit, and though I don’t post there much, reading some of the things people come up with blows my mind.  Today, someone asked if they should take a loan from the bank to build a nest egg.  This question essentially boils down to “should I pay interest on a loan that I don’t currently need and may never need?”

To give credit where it’s due, at least this person recognized their own ignorance and asked before doing something so stupid, but I mean…come on, seriously?

I also recently found out that the average car loan in America is for ~67 months.  SIXTY SEVEN MONTHS.  That’s over five years.  Absolutely, completely mind-blowing.  If you have to finance a car for 5 years, you cannot afford that car.  It’s astounding what people will do when they have a bad case of the “wants.”

And I just want to stress here again, credit cards aren’t free money like most people seem to think (current average credit card debt: $15,863), but I’d like to add that if you pay off the statement balance in full every month, they actually can be free money.  Credit cards are an amazing tool when treated with responsibility.  Cash back, return protection, protection against unauthorized charges (as opposed to draining your bank account if someone steals your debit card info), price matching, rental car benefits, sign up bonuses, and the list goes on.  But if you don’t pay them off in full every month, you are digging yourself into a hole.

Guys, money controls almost every single aspect of your life whether you like it or not.  If you’re not willing to spend a small amount of time to learn about the basic do’s and don’ts of personal finance, you are doing yourself and anyone that relies on you a great disservice.