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#52 Aug 28 2013 at 10:29 AM Rating: Good
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They'll definitely FAR be better off than not doing anything. And I wouldn't be surprised if that tactic worked way better than sitting them down for lectures about budgets. Smiley: lol

In my household, money always had such an odd and changing connotation, that I doubt my parents were all that willing to really openly talk about it with each other, let alone with us.
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#53 Aug 28 2013 at 10:40 AM Rating: Good
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someproteinguy wrote:
idiggory, King of Bards wrote:
My parents are far from a solid resource on those matters.
This.

Unless you count as an example of the perils of racking up 6-figures of credit card debt. Smiley: rolleyes

Edited, Aug 28th 2013 8:54am by someproteinguy
I don't see why you wouldn't. We learn as much from our and others mistakes as we do from successes. In my life/career, I've learned far more from why we don't do things certain ways or it ends up in ****** results than I have from we do things certain ways so that we don't have ****** results. Suffering through the effects is far more enlightening than hearing about it.
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#54 Aug 28 2013 at 10:44 AM Rating: Excellent
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Uglysasquatch wrote:
someproteinguy wrote:
idiggory, King of Bards wrote:
My parents are far from a solid resource on those matters.
This.

Unless you count as an example of the perils of racking up 6-figures of credit card debt. Smiley: rolleyes

Edited, Aug 28th 2013 8:54am by someproteinguy
I don't see why you wouldn't. We learn as much from our and others mistakes as we do from successes. In my life/career, I've learned far more from why we don't do things certain ways or it ends up in sh*tty results than I have from we do things certain ways so that we don't have sh*tty results. Suffering through the effects is far more enlightening than hearing about it.
Fair enough, but I'm still not sure I want to take financial advice from someone who's repeatedly demonstrated their inability to manage their own money.
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#55 Aug 28 2013 at 10:48 AM Rating: Good
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You don't take advice from them. You simply don't do what they did. At least, in it's most simplest form.
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#56 Aug 28 2013 at 5:18 PM Rating: Decent
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Absolutely agree with the education thing. Back when I was in high school, they used to teach home economics in addition to other economic classes. Home Ec taught you how to do things like balance a checkbook, set a household budget, pay bills, etc. I suspect that this has largely been eliminated from school curriculum because it had a negative connotation associated with it (associated with young women who were not expected to go into the work force but would need to know how to manage the home while their husbands were busy working). Kinda like throwing out the baby with the bathwater, I guess, given how beneficial such education would be for everyone.


And cause I just can't help the "I told you so":

idiggory, King of Bards wrote:
Except that the reality of the situation is very different now than it was 10 or 15 years ago, because of legislation pushed through 5 or so years ago to stop predatory lending on young adults.


4 years ago. It was Obama's sweeping credit card reform, passed in 2009. And the negative consequences of that reform were predicted by conservatives and promptly ignored or dismissed by liberals as some kind of scheme to protect rich banks from reform. So welcome to your own petard, I guess?
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#57 Aug 28 2013 at 7:00 PM Rating: Good
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Except you missed the part where I said I also agreed with the legislation, because predatory lending was a serious issue that this legislation HAS solved. My problem isn't the inability of students to get easy lines of credit, its the inability for them to build a credit history. Cards shouldn't be the only way to manage that for young adults.

And the fact that school systems have been rapidly shedding programs like home econ because of no child left behind is a much larger issue for my generation. My high school didn't even have home econ, shop, etc. Short of computer-based classes, essentially all electives minus art and band were ones that would have a strong correlation with skills that would train students for test taking.

You don't get to stack the cards against you and then be outraged when they fall. Comprehensive education and lower regulations, less comprehensive education and much higher regulations. I'd LOVE for comprehensive education to be the name of the game. But it hasn't been the left blocking those efforts for years.
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#58 Aug 28 2013 at 7:21 PM Rating: Default
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idiggory, King of Bards wrote:
Except you missed the part where I said I also agreed with the legislation, because predatory lending was a serious issue that this legislation HAS solved.


I didn't miss that part. Hence the whole "met your own petard" bit. You agree with a piece of legislation which was passed to prevent predatory lending. But the consequence of doing that is that all lending will become more restrictive (because risk and rate are directly related).

Quote:
My problem isn't the inability of students to get easy lines of credit, its the inability for them to build a credit history. Cards shouldn't be the only way to manage that for young adults.


They're not. Buy a car and pay it off. That'll do amazing things for your credit rating. Buy appliances/furniture on payment plans. Pay them off. Any method of borrowing which is successfully repaid will result in an improved credit rating. The problem is that most of that kind of borrowing isn't possible unless you already have a positive credit history or can show sufficient income. My point is that this isn't a new problem. Credit cards have been the easy way to get around it for a long time, but it required that those young people just starting out with their first credit card actually be responsible and use them wisely. But of course, some didn't, and they got into a pickle, and Obama decided that he would save them from that danger by basically making it so credit card companies wont give them cards anymore.

Kind of a stupid solution, but there you have it. The net result is that the "fast and easy" way to build credit has been taken away (mostly). So now you have to do it the old fashioned way: Get a job. Earn enough money that someone will give you a loan. Pay off loan. That's how people used to build up a credit history. We've just gotten used to the availability of high rate credit to high risk consumers as a way for those who could handle it to build credit earlier in their lives. Why be surprised that when you pass a law which prevents the high rates, you also prevent lending to high risk consumers?

Quote:
And the fact that school systems have been rapidly shedding programs like home econ because of no child left behind is a much larger issue for my generation. My high school didn't even have home econ, shop, etc. Short of computer-based classes, essentially all electives minus art and band were ones that would have a strong correlation with skills that would train students for test taking.


/shrug. There are a host of reasons for why programs like home ec have largely been canned. Most likely the lack of any groups lobbying for such classes is part of the problem.

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You don't get to stack the cards against you and then be outraged when they fall.


And yet, you support a law that stacked the deck against you, and are now outraged at the result. So...?

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Comprehensive education and lower regulations, less comprehensive education and much higher regulations. I'd LOVE for comprehensive education to be the name of the game. But it hasn't been the left blocking those efforts for years.


"Comprehensive education" is a buzzphrase. It means nothing. More correctly, it means whatever the semi-random political conditions of the moment say it means. You simply can't teach everything to everyone. The problem is that as we add things that the current political environment insists must be part of a "comprehensive education", you have to remove something else that used to be taught. Education actually is somewhat of a zero sum game in that respect. So the problem isn't that we don't have comprehensive education, but that the comprehensive education we have today doesn't have some things that you (and I for that matter) think it should.
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#59 Aug 28 2013 at 7:26 PM Rating: Excellent
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This whole exchange reminds me of the "Merchants won't take your debit cards any longer!" scare stories from a couple years ago and Gbaji making the same claim: that he had warned us about this!

Then he couldn't find a single source actually warning about it before the legislation passed. And, as it turned out, the scare stories were far overblown -- I've noticed zero impact in my debit card use years after being warned of the immanent apocalypse.
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#60 Aug 29 2013 at 6:35 AM Rating: Good
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Quote:
They're not. Buy a car and pay it off. That'll do amazing things for your credit rating. Buy appliances/furniture on payment plans. Pay them off. Any method of borrowing which is successfully repaid will result in an improved credit rating.


Good luck getting an auto loan without a credit history in the current market. And payment plans only positively affect your credit if the company is reporting to a credit bureau, which they almost certainly are not doing.

"Any method of borrowing" is absolute crap. The vast majority of companies you borrow from will not be reporting your positive payments or debt. The only influence on your credit that can possibly have is by defaulting, having your account referred to a collections agency (who WILL report it).

Generally speaking, the only real sources that will report to a credit bureau are ones that actually deal with the business of lending. Specifically, because they need to abide by the fair reporting standards and don't want to bother with it as a result.

Is it possible to start a credit line? Of course. My point is that it's far more difficult than it should be relative to the importance of having good credit in our economy. Ideally, I'm much happier with the idea of that latter part changing. Pragmatically, I don't expect that to happen.

Quote:
"Comprehensive education" is a buzzphrase. It means nothing. More correctly, it means whatever the semi-random political conditions of the moment say it means. You simply can't teach everything to everyone. The problem is that as we add things that the current political environment insists must be part of a "comprehensive education", you have to remove something else that used to be taught. Education actually is somewhat of a zero sum game in that respect. So the problem isn't that we don't have comprehensive education, but that the comprehensive education we have today doesn't have some things that you (and I for that matter) think it should.


No, it means you need to reduce time spent teaching something else. Which is very, very different. Right now, we spend way more time on dedicated instruction in math and english than is necessary, because those are the disciplines that get schools funding.
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#61 Aug 29 2013 at 6:46 AM Rating: Excellent
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idiggory, King of Bards wrote:
Good luck getting an auto loan without a credit history in the current market.

You can, but maybe not for the car you want or the terms you want. Provide half the cost as a down payment as you'll look a lot more attractive. Get a modestly priced used car and you'll look more attractive. Accept the fact that you'll be paying a higher interest rate because people without credit histories are a traditionally poor risk for auto loans.
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#62 Aug 29 2013 at 7:19 AM Rating: Good
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gbaji wrote:
The problem is that as we add things that the current political environment insists must be part of a "comprehensive education", you have to remove something else that used to be taught.
There's a block of instruction in February about peanuts that could easily be omitted.
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#63 Aug 29 2013 at 7:21 AM Rating: Good
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Yes, but it comes down to the same thing - the point is starting your credit history at the time when it would be most important to be starting it (when you're 18 or 19).

Most banks won't make auto loans at the price bracket a young adult would be shopping at. I just glanced at the requirements for my bank, and they won't make a loan on a vehicle below a 2009 model, and not for a vehicle valued under $7500.

Most young adults who are shopping for their own cars, without help from their parents, aren't going anywhere near that price point. Most won't until after graduation. But building credit after you are 21 isn't so hard. But not having any credit built by the time you are 21 is a problem.
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#64 Aug 29 2013 at 7:23 AM Rating: Good
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Jophiel wrote:
idiggory, King of Bards wrote:
Good luck getting an auto loan without a credit history in the current market.

You can, but maybe not for the car you want or the terms you want. Provide half the cost as a down payment as you'll look a lot more attractive. Get a modestly priced used car and you'll look more attractive. Accept the fact that you'll be paying a higher interest rate because people without credit histories are a traditionally poor risk for auto loans.


From what I hear on the local radio for the local used car dealers, they seem more than willing to try and help you get one of their used vehicles.
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#65 Aug 29 2013 at 7:34 AM Rating: Excellent
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idiggory, King of Bards wrote:
Most banks won't make auto loans at the price bracket a young adult would be shopping at. I just glanced at the requirements for my bank, and they won't make a loan on a vehicle below a 2009 model, and not for a vehicle valued under $7500.

So you shop different banks. Or take financing from the dealership. Or scrounge for a co-signer. Get it from one of those no/bad credit financing outfits that puts a kill switch in your car in case you stop paying the bills.

I won't say these are as favorable as the options someone with established good credit gets but that's the difference between having no credit, bad credit and good credit. Pay your bills and get into that last category. But there's people with no credit who want to buy stuff and consequently there's a market out there for getting people with no credit (or recovering credit) and selling them stuff. People want to make money after all.
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#66 Aug 29 2013 at 7:35 AM Rating: Good
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"GOOD CREDIT! BAD CREDIT! NO CREDIT! Come'on down to Crazy Larry's Used Car Emporium where no one is turned away!" Seems to be a pretty reoccurring advertisement.
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#67 Aug 29 2013 at 7:54 AM Rating: Good
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TirithRR wrote:
Jophiel wrote:
idiggory, King of Bards wrote:
Good luck getting an auto loan without a credit history in the current market.

You can, but maybe not for the car you want or the terms you want. Provide half the cost as a down payment as you'll look a lot more attractive. Get a modestly priced used car and you'll look more attractive. Accept the fact that you'll be paying a higher interest rate because people without credit histories are a traditionally poor risk for auto loans.


From what I hear on the local radio for the local used car dealers, they seem more than willing to try and help you get one of their used vehicles.


Jophiel wrote:
idiggory, King of Bards wrote:
Most banks won't make auto loans at the price bracket a young adult would be shopping at. I just glanced at the requirements for my bank, and they won't make a loan on a vehicle below a 2009 model, and not for a vehicle valued under $7500.

So you shop different banks. Or take financing from the dealership. Or scrounge for a co-signer. Get it from one of those no/bad credit financing outfits that puts a kill switch in your car in case you stop paying the bills.

I won't say these are as favorable as the options someone with established good credit gets but that's the difference between having no credit, bad credit and good credit. Pay your bills and get into that last category. But there's people with no credit who want to buy stuff and consequently there's a market out there for getting people with no credit (or recovering credit) and selling them stuff. People want to make money after all.


Financing from the dealership is unlikely to be reported to a credit bureau unless you default on your payments and it goes to collections. So it's not going to build credit unless you get an auto loan from a bank.

My issue isn't that there's no way to build credit, my issue is that there's no way that is feasible for the average 18-20 year old, which is problematic because it's one of the best times to start building credit.
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#68 Aug 29 2013 at 8:03 AM Rating: Excellent
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Financing through a dealership is often through a bank (or other registered lender) that the dealership is aligned with. I heard once that GM makes more money from its GMAC Financing division than they do from physically selling cars. Unless you're going to a completely independent joint where the guy who owns it is essentially letting you borrow the car as you make payments on it. So, you know, do some homework and buy it from the right place.
Quote:
my issue is that there's no way that is feasible for the average 18-20 year old

This is where we disagree. There's feasible ways, just not necessarily favorable ways.

Edited, Aug 29th 2013 9:04am by Jophiel
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#69 Aug 29 2013 at 8:22 AM Rating: Excellent
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#70 Aug 29 2013 at 8:47 AM Rating: Good
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I still have a bunch of DKP's scattered about the internets. I can trade them in for batcoins, yes?
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#71 Aug 29 2013 at 9:24 AM Rating: Decent
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Wasting your time folks. Iddiggory expects everything to be handed to people. People shouldn't have to work at anything, they should just start at awesome. It's his MO on everything.
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#72 Aug 29 2013 at 9:33 AM Rating: Good
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Uglysasquatch wrote:
Wasting your time folks. Iddiggory expects everything to be handed to people. People shouldn't have to work at anything, they should just start at awesome. It's his MO on everything.


I wasn't aware I was advocating people to just get handed good credit scores.

I'm saying that lines of credit are too limited right now for people under 21. Considering any line of credit has far more potential to hurt you than help you, that's pretty much the opposite of a hand out.
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#73 Aug 29 2013 at 9:43 AM Rating: Excellent
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No bank credit card from the credit union you've had an account with since you were 3 months old?
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#74 Aug 29 2013 at 9:53 AM Rating: Good
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someproteinguy wrote:
No bank credit card from the credit union you've had an account with since you were 3 months old?

I wish I was a member of a credit union.

Though it wouldn't matter - bank-issued credit cards are still bound by the 2009 regulations.
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#75 Aug 29 2013 at 9:56 AM Rating: Good
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idiggory, King of Bards wrote:
Uglysasquatch wrote:
Wasting your time folks. Iddiggory expects everything to be handed to people. People shouldn't have to work at anything, they should just start at awesome. It's his MO on everything.


I wasn't aware I was advocating people to just get handed good credit scores.

I'm saying that lines of credit are too limited right now for people under 21. Considering any line of credit has far more potential to hurt you than help you, that's pretty much the opposite of a hand out.
I "may" have over embellished the idea, but you have a history of thinking (and expecting) everything to/should be easy. You've been shown tons of other options available and shoot down everyone because its not an easy route. Sorry, that's reality.
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#76 Aug 29 2013 at 9:58 AM Rating: Excellent
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Huh, well that's a bummer. That was the card I used most in the beginning, it was a joint account with the parents and everything with a fairly low credit limit and interest rate, something like $1,000 or what not. Contrasted to GM which felt comfortable letting a college student with no income get a $5,000 limit, which went up to $8,000 before I even had my first real job. Smiley: rolleyes
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