The fact of the situation is that most adults don't have a good understanding of how credit works. We're all told to pay our bills on time, but it's not always that simple.
Businesses take advantage of our ignorance, ineffective laws, and the inexperience of our youths and the pressures of this consumer driven culture.
Personally, I have a friend who played by the rules and got credit cards when he was 20 in order to establish credit history. In the end, he owed more than $30,000 in credit card debt. He didn't even make that much in a year. He got in over his head and wasn't able to pay, using all his cash to make the payments and using the cards to live. The credit card companies didn't get their money and his credit was ruined. It was a lose-lose situation.
It's worth noting that current law requires credit counseling if you want to file for bankruptcy, including education for setting financial goals and budgeting. Wouldn't it be nice if we learned these things in the first place?
I would love to see an addition to the new law that requires adults under 21 to complete some kind of credit education before than can be issued a card.
posted 4 years ago
view in context