Drowning in debt, he needs a life raft - guy spends $2000 more per month than earns

[Liberal_in_LA]

http://www.latimes.com/business/la-fi-makeover27jan27,0,6826094.story

Nathan Drake, who owes $54,000, spends nearly $2,000 more than he earns each month. An advisor urges drastic changes.

By Kelly Barron, Special to The Times
January 27, 2008

**SNIP***

Starting over -- and buying a truck and a sparkling wedding ring for his new wife -- put Drake further in the hole.

He dug it even deeper, splurging as a newlywed to show his Canadian wife, Jodi, 23, around Southern California. He and Jodi dined out on $100 seafood dinners, took trips to Las Vegas and, on weekends, went out to dinner and a movie.

All of it added up. Drake carries $29,000 in debt on six credit cards. He owes an additional $16,000 at his bank. And he has borrowed $9,000 from his 401(k) retirement plan, which is worth $14,000 and was his only unencumbered asset.

Each month, he spends nearly $2,000 more than he earns. Any financial mishap and he's further in the hole. Recently, Jodi needed a root canal, forcing him to put $900 more on plastic.

***snip***

He pays about $6,800 a year in loan, insurance and gas bills for his Chevy Silverado truck. Drake said he needs the gas guzzler so he can tow a motorboat to vacations along the Colorado River. He paid $2,300 for a one-third interest in the boat; his buddies own the rest.

"People who are $54,000 in debt don't go on vacation," Barlow countered. "The whole picture here is one of denial."

[dkf]

1. Even if he goes bankrupt...he still sounds screwed.

The guy is out of control.

[roguevalley]

30. he's addicted to spending. he won't be saved until he's living in a

card board box and even then, I don't know. He needs to get real but I think he has a sickness. Truly.

[havocmom]

2. not to worry, bushco probably has a job for him

[hatrack]

16. Yes, I'm thinking either the new SEC head, or maybe he could take Bernanke's job

:eyes:

[dysfunctional press]

3. but if they decide that it's the right time to start a family...

there's plenty of people here that would cheer them on in that decision.

[dkf]

4. I guess that is the difference between those in poverty and those that are irresponsible.

[DBoon]

5. Another deluded American

who apparently thinks a white collar job entitles him to vacations, restaurant meals, and a nice car.

Dinner and a movie? Forget it. The "middle class lifestyle" is so mid-century.

We ain't the "affluent society" anymore.

This ain't the summer of love.

[Xenotime]

90. Very true. Only the rich can afford those things.

[JCMach1]

124. Too many people here blaming the guy- what about the idiots who keep giving him $ ?

Whatever happened to due diligence?

Answer: doesn't exist... has been replaced by the quick and often inaccurate picture of credit reports.

The guy's spending is out of line, but so are his enablers!

[BadgerLaw2010]

141. They would be the ones charging him massive interest a.k.a. risk payments.

[SammyWinstonJack]

144. We save $2000 a month. No extravagant vacations, no expensive dinners out.

But then working 10/12 hour days five or six days a week, leaves little time for anything but work and sleep. :shrug:

[BlueCollar]

158. why do you hate

"umerika"...

[lligrd]

6. A True American Patriot

* could use this guy as a role model for all of us to emulate. This is after all his economic plan.

:sarcasm:

[niyad]

7. ummm, fool, have you ever thought about LIVING WITHIN YOUR MEANS?

this sort of thing makes me ill, all the more so because I know a person who is doing something very similar, although on a much smaller scale, whining because she cannot get along on $1700 month (medically retired, no kids)and living in an area that isn't the most expensive in the country. I watched her blow 30K in less than three months, with nothing to show for it, and anger at anybody who tried to point out her insanity.

[demigoddess]

91. i know lots of people who do this in varying degrees, usually they are lower income

and just cannot face facts, they THINK they are rich.

[madmom]

103. that's why so many so called blue collar workers vote republican, they think they're rich!

[The Straight Story]

113. Lower income my ASS - most corps and our own govt does this

:)

[tammywammy]

117. Champagne life on a beer budget

That's what my dad always called it. :)

[Sam_Smith]

121. Funny, My Dad said the same thing too n/t

n/t

[MadHound]

8. Sadly, there are millions more like him across the country

Part of the reason that we got into this subprime/credit crunch/recession that we're in, people living beyond their means.

Scary stat that I heard the other day, that the average American has ten thousand dollars in credit card debt. Since I don't have a credit card, that means there are people out there carrying twice that number.

The social/commercial acceptance of credit cards over the past ten years is astounding. Credit cards used to be quite rare, then they became acceptable for large purchases, now people are charging three dollar lattes on them without blinking an eye. No wonder this country's economy is going to hell.

[A HERETIC I AM]

65. I doubt that statistic.

the average American has ten thousand dollars in credit card debt.

I'd be very interested in reading the source for that claim. Perhaps it is the average American that has credit card debt has ten grand of it, or perhaps the average total debt is $10,000.

I just find it hard to believe that the average American owes ten grand on credit cards.

[El Pinko]

98. Actually, that sounds about right.

Factoring in the folks who don't have any balances, then all the millions of folks who have total balances of around $20k on 5 or 6 cards (that's about where the card companies usually decide you're maxed out, that really sounds about right.

I was about $20K in the hole (not including $17K in student loans) when I threw in the towel 2 years ago. I still pay the student loans though, because unlike unsecured consumer debt, there is no statue of limitations on them, and the government will not hesitate to garnish your wages to pay them off.

I know ton's of people in hock between $10 and $20K. The guy in the story is a doozy, though.

[Lasher]

125. The average household has more than $8,000 in credit card debt.

Grand total debt per household is $18,654, not counting mortgages.

http://moneycentral.msn.com/content/SavingandDebt/P70581.asp

http://www.fool.com/ccc/secrets/secrets.htm

These are disturbing statistics.

[El Pinko]

130. And did you read the part about the payoff?

"The average household has more than $8,000 in credit card debt, up from about $3,000 in 1990. An $8,000 debt at a rate of 18% interest will take more than 25 years to repay and cost more than $24,000."

That's assuming you STOP using the cards altogether, cut them up and then pay off some principle every month. I think recent law changed this, but until recently, many credit card companies would let you pay a minimum that barely covered the interest. Even now that bigger minimums are required, it would still take a fortune and a lifetime to pay them off when paying the minimum - which is exactly what most maxed-out people do, but they don't stop using the cards, they have to charge things like food to make ends meet because of all the money they spend on debt service.

The banks are crying right now, but over the last 15 years they have raked it in off of people like this, but the debt load is getting to be too much for many of them to service, especially with the prices going so high now...

[Lasher]

133. Yep and that assumes 18% and not 30% like our hero in the OP.

The Fed pumped lots of extra M3 money supply cash into the economy to make it look like the tax cuts were working. But with real median wages dropping and job growth stagnant, there was noplace for it to go without easy credit. So they've kept interest rates low while they peddled subprime mortgages. And of course the credit card companies have aggressively pimped their wares to anyone and everyone.

[Kixel]

150. I actually don't doubt it...

Some of my friends are impossible at borrowing-they raise the curve quite a bit. I think it depends on where you live and what stage of life you are in. I have friends who think nothing of throwing something on a credit card until they get to the point where it has to go on a card because they don't have any money.

It's a vicious cycle that is difficult to get out of when you get sucked in. Luckily, I got sucked in at 18 and had a consolidation loan by the time I was 20. What was huge then seems small now-but if I hadn't gotten out when I did, I can't say where I'd be.

[Bozita]

When the going gets tough, the tough go shopping.

[Kittycat]

9. He's an idiot, and needs a slap of reality upside his head.

I'd love to do 1/4 of that, just once in my life.

[JanMichael]

61. No shit what fucking moron. Seriously it's like this country has...

...created zomby people that can't even do simple math. Christ almighty what a dufus.

[truedelphi]

10. But what was the intent of this protrait?

I know people like this - they go to Disney land and eat out the entire time they aren't on vacation.

They spend as much on souvenirs as they spend on gas when they vacation.

They drive gas guzzling SUV's to crappy jobs that pay little.

But the intent of this story is so that the 10% that still thinks that anyone can get ahead will be able to justify their philosophy that all it takes is common sense, a decent budget etc to get ahead. (For the group making the $ 54k that might be true, though if there are kids and it's a high rent area, forget it.)

News articles like these keep the Banking Reform Bill of 2005 and all its onerous clauses (and sub clauses) alive and well.

[MadHound]

12. I think it also goes to show up how personal responsibilty has gone out the window for many people

American consumer society has convinced too many people that they need an ever increasing number of toys to live the good life, when that really isn't so. This man represents that attitude, one that is prevalent in our society. Fewer and fewer people are willing to rise through society the old fashioned way, with hard work and patience. Yet as this latest economic disaster shows, it still is the best way of trying to make it.

I don't make fifty plus thousand, never have. Yet through hard work and patience I've managed to leverage my situation into a twenty acre farm in the Midwest. Is it tough? Sure, and getting tougher. But it can still be done if you have a little bit of brains and some common sense. Sadly those two traits seem to be ever decreasing quantities.

[truedelphi]

49. Your points are valid ones.

One of the things that makes it harder is that nowadays, people haven't always gotten control over their assets.

For instance, In California, PERS system is bilions of dollars short of what it needs to compensate all those who thought that they would have decent pensions.

County and State workers put like 9% of their salary away into those funds, with the employer doing a matching amount. But the individual has not a single bit of influence on how those vast amounts of money are dealt with. If they are invested in the wrong thing, the pensions go out the window.

And of course, the people at the top, who actaully do control the money fund, often are unscrupulous.

[grasswire]

11. he spends like George W. Bush!

Putting it all on plastic or borrowing from the Chinese. Silverado or humongous tax rebate. George can do it with impunity. The little guy needs to see leadership at the top -- disciplined fiscal responsibility.

[Fovea]

13. as above

so below.

[HughBeaumont]

14. Dom Perrignon lifestyle, Budweiser salary.

Unbelievable that one so fucked can be smiling like he is.

This is called "Refusing to Accept You're a Peasant" syndrome. Affects a great deal of Americans.

[SoCalDem]

15. Drake is an asshole.. n/t

[LostInAnomie]

17. I have no pity for idiots like this guy.

He deserves to lose his ass, because he has brought these problems on himself through conspicuous consumerism.

It is people like him that give people that legitimately go into bankruptcy a bad name. He, and people like him, become the easy example for Repukes to point to and broadbrush all people that are in debt as fools that throw their money away.

[TroglodyteScholar]

18. I've got absolutely no sympathy for people who CHOOSE to spend recklessly...

...come ON man, grow a brain.

[AP]

19. Half the problem with this story is that this guy can't do math. The other half is that banks keep

extending him credit.

The fact that he keeps getting credit screws over people who can afford stuff.

Do you think a root canal would be $900 if even people who can't really afford one can go into debt to get one? (Perhaps credit is a big part of the reason people don't push harder for socialized medicine.)

Easy credit drives up prices for everyone.

[Yavin4]

23. BINGO!!!!! AP!!! M*THERF*CKING BINGOOOOO!!!!!

When you wrote:

"Perhaps credit is a big part of the reason people don't push harder for socialized medicine."


YOU HIT THE NAIL RIGHT ON THE HEAD!!! EASY ACCESS TO CREDIT IS THE BIGGEST OBSTACLE TO TRUE PROGRESSIVE SOCIAL AND ECONOMIC POLICIES IN THIS COUNTRY.

[originalpckelly]

77. You have it, credit enables bubbles and interferes with the self-regulation of prices in a market.

When people do not abstain from buying something, they do not force a company to become more efficient or lower its profit margins. It is this break in self-regulation that causes our bubbly economy. No one should be living in debt like that. The lesson is to save first, have a nice sized savings from which to buy things when you need them, not to buy something on credit and scrimp to live every month. You can still get what you want, only you don't have to pay interest on something. You don't need to save up months and months for one thing, just save, and then when you come upon something you want, buy it.

[AP]

110. Things you buy on credit better appreciate enough to cover the interest you'll owe on the debt.

That logic applies to just about nothing people buy on credit.

[jlake]

20. I feel sorry for him. It looks like he is living pretty frugally to me.

It is unfortunate that wages have not kept up with the costs of living.

[NashVegas]

27. Huh?

You should read the full article.

The guy has been living beyond his means since college.

[jlake]

29. I did read it and that was my conclusion.

[LanternWaste]

146. Your conclusion based on what...?

Your conclusion based on what...?

[gollygee]

34. The boat and the $100 seafood dinners led you to that conclusion?

ROFL

[jlake]

35. The boat was the only thing I thought was stupid. I mean, he went on his honeymoon

fairly locally.... it's not like he went on a trip to Europe or Tahiti.

[gollygee]

62. It doesn't say a honeymoon trip to Vegas, it says trips plural to Vegas on weekends plural

just for fun. And $300 a month regularly eating at restaurants. Which honestly doesn't seem like that much to me, but I'm not living on $36k a year and I don't have that kind of debt. When I was his age I was living on less than that, and I had debt though not anywhere near that much, and I'd be surprised if I spent $30 a month out to eat. It's called living within your means. At that age, I didn't have a new truck, I had a used Ford Escort.

[Writer]

106. Let's see... 3 dinners for two a week at around $30/per dinner...

times four weeks... I have to be honest, I wasn't in agreement with $300 a month being a lot in eating out expenses... that is, if you make over $100K annually.

However, on $36K/year (which I've earned in the past) he really needs to stick to Ramen noodles.

[DBoon]

41. I sort of agree with you

I don't think he is living frugally, but he is 30 years old with what seems to be a decent white collar job.

He is taking vacations in Las Vegas, not Paris or Rome. You can drive from LA to Vegas. Flights are really cheap.

He's driving a pickup truck, not a BMW or some other overpowered status symbol.

He owns a 1/3 share of a boat, costing a few thousand - it's not a damn yacht

He just got married and bought his wife a nice ring and had a nice wedding. Maybe he should have just moved in with her?

It sounds like he wants a basic middle class lifestyle.

The sort of lifestyle a 30 year-old purchasing manager might have had during the 1960s'

I had his income when I was his age. I drove a beat up VW bug, lived in a cheap apartment, and never took vacations. It sucked. I don't blame him for wanting a bit more than this.

I'm surprised the other poster on this thread haven't faulted him for not moving back in with his parents.

Have our expectations fallen so much, are we so bitter, that we have to condemn someone for wanting what my parent's generation took for granted (they even called it "the affluent society" back then).

The problem isn't his desire for a decent lifestyle - the problem is that we have become so diminished that we don't believe it is possible, and that even trying is somehow suspect.

[davsand]

63. "I drove a beat up VW bug, lived in a cheap apartment, and never took vacations"

You lived within your means. You knew what you cloud afford at the time.

I might have felt sorry for the guy if I'd seen anything about medical debt or an illness that kept him from working. Hell, I might have even felt bad for him if he'd been busted out by an adjustable rate mortgage that some mortgage broker steered him into.

I can't, however, feel bad for anybody that made the choice to buy diamonds, lobster, toy boats, and vacations. I'd like to have those things myself, but our income simply doesn't support that with BOTH of us working.

Hell, we are driving two cars with over 150,000 miles on them that are (I'm being polite here) both buckets of rust--but they RUN and they are paid for.

We live in a two bedroom house that one salary can pay the house payment on because that is what we CHOSE. yeah I'd like a big house, but I can't afford the taxes and house payments on one so I live where I do.

We eat out sometimes, but the last time we ate out it was at a burger place--not a seafood palace. Similarly, we see a movie a few times a year. We do watch movies at home as a family (on the DVD player) but even those are not an every night thing.

We sure as hell don't go on expensive vacations, either. Our last family vacation was us in a guest house for a few days. We went to a drive in movie and we played Monopoly every night. By day we explored Hannibal, Mo. I think we spent maybe $350 on that trip when it was all said and done. I had saved that money up over time--not one cent went on plastic. (If gas had been cheaper it would have cost less!)

Anyhow I am not bitching here, I am just saying that it is possible to do stuff and be happy on a budget. Yeah it ain't always easy, but you can do it and be ok with it.

I dunno, that guy lost me when he refused to give up the boat. Gawd.



Laura

[Ghost in the Machine]

73. "He's driving a pickup truck, not a BMW or some other overpowered status symbol."

ummmm... the new Silverado my ex wife bought in 2000 cost $37,995 ....

maybe you should look up truck prices... you seem to think like they're all old hillbilly and/or farmer rattletraps.

There are trucks that cost 50 to 60 thousand dollars out there...

[jmowreader]

78. You haven't priced pickup trucks lately, have you?

My production manager wants a one-ton pickup to tow the camper he lives in. (Long, long story.) He went to the local Ford dealer and saw twelve trucks that might work. The least expensive one was $44,000; the most expensive was $62,500.

[El Pinko]

99. But he's not trying, he's just spending.

Nothing wrong with wanting a better lifestyle, but this guy hasn't been trying to make more monay to buy it, he just bought it and bought it and bought it and bought it - on plastic.

He must have really pretty eyes or something, because if I was his wife and heard his financial history, I'd have walked the other way.

And yes, a lot of his people have moved back in with parents so that they can right their financial ship. If that had been an option for me, I would have definitely done it.

Yes, expectations have fallen and the middle class is kaput - that's a nationwide social problem. But this guy's profligate spending is an individual one.

[BadgerLaw2010]

140. Odds are that truck costs more than a Mercedes C-class.

[karlrschneider]

51. "frugally"...I don't think it means what you think it means...

:eyes:

[jlake]

58. He honeymooned locally, does not drive a fancy car, dinner out and a movie

on Saturday nights is hardly "living high on the hog".
His total debt is what many spend on a single vacation.... let alone a wedding, rings and a honeymoon.

[karlrschneider]

70. Yeah, well some people spend a million dollars on a single vacation,

or a birthday party for their rugrats...but those kinds of people generally make enough money to FUCKING PAY FOR IT.


:eyes:

[theHandpuppet]

75. Do you know how much a Chevy Silverado costs?

We've never owned a car worth half that.

Not to mention how much it takes to gas up that guzzler, especially when it's towing his boat.

Sorry, no pity here for that dodo head.

[El Pinko]

100. He drives a late-model Silverado which he bought with a loan...

So that's a MINIMUM $20K car, and since it has a loan, he has to have full collision insurance which makes it even more expensive.

My last car was a 5 year old Ford Escort, which I bought for cash, so I could buy just the minimum legal insurance. It didn't guzzle gas like a Silverado. This guy is barely making more than I did, but his spending is at a whole other level. I hope his new wife is helping with rent and expenses.

[jlake]

107. I don't mean to offend anyone. That truck sound perfectly reasonable and inexpensive

compared to "fancy" to me.

[El Pinko]

108. You're not offending me. But is your income in the 30-40K range?

If it's not, then maybe your sense of what's reasonable is a bit off.

I have a lady friend who recently told me "America is so great, because food is so cheap, poor people never have to go hungry" She lives alone and pays about $100/wk for groceries, then goes out on one weekend night or so for $30 or so.

But she has a 6 figure income, a house that's paid off that came in the divorce settlement, etc.

Buying food for a family of 4 on an net income of $2k per month was not so easy for me - Even clipping coupons, it was hard to keep it under $600/mo, then rent on our tiny run-down basement unit in SF was $1300 (utilities included) - that left me with about $100 per month for gas, phone, car repairs, medical, insurance, clothes for kids, etc. etc. I had counted on my wife's business income to help out, but it never took off and never made a dime, so I defaulted on my debts and moved back to Texas where the cost of living is lower (but food is still not "cheap" by any means).

Just saying that people whose financial nests are already lined may have a very different perception of what is cheap and expensive, and what is a reasonable expense.

Personally, in light of this man's enormous debt, he has no business driving a new car with a loan. He should sell it and buy a used econobox beater and get the minimum insurance - he'll save a lot on gas, too. He needs to sell the stupid boat and get his house in order. He should also think about another region of the country, because housing even in the Inland Empire is prohibitively expensive. If he lived in El Paso, he could easily buy a nice home on that kind of income.

[jlake]

109. I know it is very tough to make it. I do have an income of more than that, but have

had an extraordinary burden for the last several years (2 mortgages and all of the bills to go along with them, 3 auto loans, 2 sets of student loans, a daughter in college and a MAJOR dental bill that exceeds my annual income) You can't know what is necessary for someone else. I remember not too long ago, not having a reliable car... which caused me to miss enough work that would equal a car payment. And I agree with you about location - I was in central CA....nothing like SF, but since I moved to Pittsburgh, my Cost of living has gone down dramatically.

[El Pinko]

116. Well, I certainly won't judge your spending...

But it seems like a lot more of your income is for necessities or things like education which is an investment in the future. This man's debt is mostly due to expenses related to having fun and keeping up a certain lifestyle. I think you're very nice to want to give him the benefit of the doubt, but personally, I'd be very embarrassed to be profiled in a MAJOR newspaper and letting the world see that I had run up $54K in debt just on playthings and fancy dinners. People make mistakes, but appearing in the the newpaper like this makes it seem like he thinks he deserves sympathy, and I'm sorry, I don't think he does.

Heck, I was in a much more difficult situation in just about every way, and I STILL don't think I deserve a lot of sympathy. I should have insisted that we move back to Texas 2 years earlier to get my financial house in order, but my wife really wanted to have a chance to try her business in SF, so I gave her that time, and ended up in hock. I did it against my better judgment because I felt she deserved the chance to at least try, and sometimes we have to make sacrifices to keep a marriage working, and it really meant a lot to her. But I wouldn't put my story in the newspaper and tell people I needed a life raft. I took a chance and it didn't work out and now we're living with the consequences. I think that as a society, we really need to get to work on the huge income disparity in this country, but the fact that things are so unfair now is not an excuse for going wild with debt.

[XemaSab]

126. Are ya high?

Who the hell spends that kind of money on vacation? :shrug:

I spend about $1,000-$1,500 on one nice vacation a year. Last year I went to Florida. The year before I went to Arizona. The year before that I went to Maine. The year before that I went to Texas.

Had a BLAST on every trip.

And you know what? I saved every penny BEFORE the trip. Not a cent on plastic. :)

[JerseygirlCT]

154. That's the trouble with the whole mindset.

Credit is for emergencies. Otherwise, if you don't have, don't spend it.

Some people MUST get overextended to eat, and have a place to live and clothe their children. But this is none of those things. His wife didn't require a ring, or a honeymoon, and he didn't need a new monster truck. These are all "wants" not needs, and wants shouldn't come with a high interest rate attached. Not when someone is being responsible.

Just MHO, of course.

[opiate69]

66. Wrong.. He is most defiitely NOT living frugally..

My wife and I did not honeymoon. Neither of us has a wedding ring. We don't vacation in Las Vegas (even though it would be considered an "affordable" trip from where we live), we own a 40 year old mobile home which is falling apart around our ears, but it is paid for. We don't own property and pay $325/month for lot rent. We have one car payment of $250/month. We have one credit card which we have not, and will not, use. (We didn't even apply for it.. it was given to my wife by Washington Mutual when she opened up a savings account there) We've been working our asses off for the last 5 years to improve our credit rating enough so that we can hopefully upgrade our living situation. Of course, thanks to idiots like this, every time we get close to having a good enough credit score to secure a loan for a new manufactured home, the banks raise the threshold. Yet my brother-in-law and sister-in-law make around 3 times as much as us, have no kids, and have 3 repos in the last 2 years.. and still keep getting new car loans or other credit extended to them..

[bullwinkle428]

80. Wow...if he lives frugally, then I'm living the most spartan

lifestyle in the world!!

[dysfunctional press]

83. you don't get $54K in debt by living frugally...

$100 dinnerS, tripS to vegas, etc...

[jlake]

85. He is clearly not responsible. But only half of his 54K of debt is CC debt.

A large portion is for a car (which is an understandable debt) and the rest is borrowed against his 402K (Stupid thing to do, but it is asset backed). .... I just don't think he is living THAT extravagantly, and I don't think people should call him an idiot and be so callous as many on here have.

[dysfunctional press]

88. an understandable debt?

i never paid more than $1000 for a car before i turned 40. he is living far more extravagantly than a lot of people here, it seems.

and yes, he IS an idiot.
(btw- i hope that the checks your wife sends you from her job in canada help get the two of you out of debt quick- but maybe you should try to get someone to buy you out of your share of the boat.)

[BadgerLaw2010]

139. High-end, late model vehicles on a shoestring budget are understandable?

Cars are almost always awful expenses.

Borrowing against his 401K is understandable?

Having $25K in credit card debt is understandable?

Who the hell would think any of this shit is a good idea?

[tammywammy]

119. That ain't frugal

I made a whopping $26,000 last year, and yet I don't have credit card debt. I can't afford $100 dinners and trips to Vegas, so I do f-ing go. Period.

[Yavin4]

21. $36,000. 00 In So. Calif. Does Not Make You Middle Class

It makes you working class,and right now, he's working class poor. With the new BK laws, getting him out of debt will not be so easy.

[NashVegas]

32. Only Because of Housing Costs

And his rent isn't that bad, considering.

$36k (more like 25k after taxes & health insurance) can go pretty far if you live reasonably. If you fail to discipline yourself it won't.

Credit cards are shockingly easy to abuse. When you spend from your checking account, your financial circumstances are always right in front of you when you balance.

Not so w/cards.

[Yavin4]

45. You're Forgetting Transportation Costs

In SoCal, your transportation costs can explode on you because of gas prices, and there's no alternative in SoCal because they don't have decent public transportation.

It never fails to amaze me how people don't really consider how expensive cars can be. In addition to the gas, there are repairs, parking, insurance, traffic violations, etc. No matter how discipline you are, these costs can quickly spiral out of control.

[NashVegas]

47. Which His Are

Largely 'cause he's got to have that Big Ass Truck.

[Yavin4]

112. Yes, Rising Gas Prices Will Kill His Budget

Dude should take a bus to work.

[BadgerLaw2010]

38. That's his net income, not gross, which puts him above the median income.

The guy is just a moron.

[Yavin4]

46. Even $60,000 A Year Does Not Make You Middle Class in SoCal

The key asset you need to be considered middle class is owning a home, not simply income. At a gross salary of $60K, he would not qualify to buy a home in SoCal, so he's not middle class.

[BadgerLaw2010]

136. By that measure, no one is middle class in SoCal.

You could have $100K in household income and still not qualify for a traditional mortgage on most SoCal housing (the places you would actually want to live).

[Katherine Brengle]

69. Agreed - it isn't around here either.

$36K, even if that's after taxes, isn't really great money in my neck of the woods (Massachusetts). It's not enough for vacations and regular $100 dinners, that's for sure.

[DS1]

22. Sell your motorboat, you stupid fuck

[Liberal_in_LA]

25. He said 'no'

From page 2 of the article: As for the boat, Drake won't sell. Because he and Jodi stay at his uncle's house when they go boating, Drake insists it's a cheap getaway. Nevertheless, he'll have to forget about motoring down the Colorado River for quite a while.

[DS1]

31. If he sold the boat, he could also sell the gas guzzler

but obviously debating what this guy should do compared to what he will do is a waste of time.

Oh well, no sympathy from me.

[DBoon]

43. He'd sell a 1/3 share in a motorboat, for about $2000-$3000

That is a drop in the bucket. It will do almost nothing to pay off his debt and eliminate his one spare time activity

Maybe he should move back in with his parents? :sarcasm:

[gollygee]

79. It would be a start, and it would eliminate his need for a gas-guzzling truck

Good strawman there with the "moving in with the parents" thing though. No one suggested that. Besides, his parents probably live in Canada, seeing as he's Canadian, and his work is in Southern California.

[DS1]

94. It would be 2000-3000 more than he has now

and since he wouldn't have to pull it around in his gas guzzling truck, he could trade that in for something more fuel efficient.

Not that you ever think more than one step at a time :sarcasm:

[AlCzervik]

24. stop going on vacation asshole, that would be good place to start.

[ConcernedCanuk]

26. Advice to Jodi - "Keep your money"!!

.
.
.

From the posted article:

"And when Jodi changes her immigration status and becomes a permanent U.S. resident, she'll start working too. Drake, a permanent resident, is awaiting his U.S. citizenship. It could take as long as a year for him to become a citizen and six months more for his wife to get her residency, said Louis Piscopo, an immigration attorney in Anaheim.

For now, though, Jodi must return to Canada while seeking residency. There, she plans to work for her sister's clothing company and to send most of her monthly paycheck to Drake."
____________________________________________________________________

Drake, the high roller, is gonna be in the States

- no way Jodi can keep tabs on him from Canada.

So I suggest Jodi save her money,

and if/when Drake gets citizenship, she gets residency

and if/when she gets down there and all is rosy

THEN think about giving her earnings away -

Drake's been married before . . . .

hmmmmmm

[NashVegas]

33. Better Advice: Get an Annulment

If she's bailing him out now, she will be for life.

[msongs]

28. bankruptcy judges should throw this guy outta court and tell him to sell his toys nt

[BadgerLaw2010]

36. Wow, portrait of a dumbass.

[high density]

37. The guy sounds like an idiot to me

I have no sympathy for these people who use credit like it's free money.

[krispos42]

39. Both sides are lacking personal responsibility

The banks keep extending him credit because they are confident that US government will get it back for them, no matter how stupid the banks were for lending it to him in the first place. If the banks, which have battalions of hard-nosed, college-educated certified public accountants and risk-management professionals on staff, had to actually risk losing their money on bad borrowers, this kind of shit wouldn't happen. But since a government bailout is only a campaign donation away and the courts will get the bank's money back, they will lend to anybody with a pulse.

And this twit is dumb enough to take all the credit that is offered and spend on stupid shit.



They both need to be punished. My idea is this:

The guy's credit cards are cancelled, and no more can be issued to him. 10% of his paycheck automatically goes to pay off his credit cards, and it stays that way until it's paid off. Now he's forced to live within his means. Or within the 90% of his means that he gets. No credit cards, no loans, nothing.

The banks cannot charge interest or fees on the now-cancelled lines of credit that are being paid off. Now the banks have money out there that is a) not gaining them interest payments or fees, and b) is losing value due to inflation, and that is their punishment. If they had made GOOD choices in extening credit, they would be making money instead.

[NashVegas]

40. Anyone Doubt His First Marriage Broke Up Over Money?

Just a hunch.

[WritersBlock]

42. Why's this guy even being considered for US citizenship??

When I applied for my British citizenship, one of the things I had to prove was that I was of "good moral character" (yeah, what a phrase, ek?) and from what I understand, that includes managing your finances while living in the country.

[Name removed]

44. Deleted message

Message removed by moderator. Click here to review the message board rules.

[NashVegas]

48. Yeah Man, Racking Up $54k Debt Could Happen to Anyone

Who has no control of their spending habits.

[Skittles]

120. this guy is a f***ing idiot

I mean, really

[JBoy]

50. The guy didn't "find" himself in a bad financial situation,

he put himself there. I'd have some sympathy for him if there was really was no way out of the mess he's in, but there is, and he's not taking it.

[Yavin4]

54. If He Was In This Situation Because of an Illness or Some Other Misfortune

Then I would be more than sympathetic, but he's in this position because he spent as if he's wealthier than what he really is.

What's even worse, is that he becomes the poster child for people who want more restrictive BK laws, which really hurts the people who are in bad economic shape because of real misfortune.

[Blue_Tires]

55. apples and oranges

it's one thing when circumstance forces you into heavy debt (unemployment and uninsured health costs, both of which i know plenty about)...it's another thing when extravagant spending lifestyles forces you into debt...(300 goddamned dollars a month eating out??)

and the trips to vegas? i'd be surprised if he didn't gamble some away as well

[Roland99]

52. Sorry, no sympathy for the guy. Total DUMBASS.

There is a thing known as personal responsibility and common sense.

[karlrschneider]

53. If you sent him a life raft, he would go out and charge a $10000 outboard motor for the thing.

Fuck him.

[pitohui]

56. he should declare bankruptcy and seek treatment for OTC/compulsive shopping

they have medicines now for OTC disorder, i wouldn't take this lying down without exploring them, in these shoes i would try to see if there was some way i could control my compulsive spending and then declare bankruptcy so i could start my life over before it was too late

the woman who married him knowing he was already this much in debt has a problem too, she's an idiot

[Yavin4]

57. People Like Him Make It Difficult for People To Get True Bankruptcy Relief

The Credit Card industry will use this jackass as proof for more restrictive BK laws, so he's not only hurting himself. He's hurting other more deserving people in the process.

[A HERETIC I AM]

59. Sad thing is, this is not uncommon. I met a woman the other day whose husband is worse.

Between them they make a little over $125,000/year and HE has racked up over $100,000 on credit cards.

Same sort of patterns. Owns a boat and keeps it in a rack at the marina. Drives a Chevy Avalanche, bought her a Tahoe. Owns a big Harley, all sorts of other toys, etc. etc.

Of course, he keeps getting credit card offers with $40,000 credit lines. Seems to me these people must think that is an asset.

"Wow, I've got forty grand MORE that I can spend."

Needless to say, this woman was almost in tears and realizes her marriage of 17 years is crumbling because of it.

[Liberal_in_LA]

60. gender pattern - Male shopholics go 4 electronics/vehicles, females splurge on clothing, shoes, jewe

[KatyaR]

156. I have a friend at work who is in a similar situation.

She and her husband split and then several years later got remarried. He buys all kinds of stuff as 'an investment for their retirement' (they're probably in their 40s). I heard her talking the other day, and he has at least a dozen cars, most of which don't run, just sitting around. He just recently took up remote controlled airplanes and now has several large expensive models hanging in the garage. And every time he talks to her about buying something, she tells him to do what he wants. She's a total enabler, and yet she has a 20-year-old oven that she won't get fixed because it's too expensive.

[AZBlue]

64. For those of you condemning him, you should realize this is a sickness.

It's a psychological problem that therapists are seeing more and more because our society encourages just this sort of behavior. Would you criticize an alcoholic so severely? An addict? This man needs psychological help, not freeper-like condemnation.

[NashVegas]

72. Eh

We're trying to be that part of society that *discourages* that sort of behavior, you know?

[gollygee]

74. Have you given him a psychological evaluation?

If not, you don't know it's an illness. If he's had one and it is an illness, he needs to stop having credit available to him.

[casus belli]

87. The help he needs is not understanding...

It's a firm kick in the ass and a pair of scissors to cut up his credit cards. If someone has an arterial wound, you don't try to console it with band-aids and positive feelings, you rush him into surgery and correct the problem. The compassion comes in when you see him actually seeking change. Unless that is the case, anything else is enabling him to continue on with his sickness. Allowing the guy one more day with intact credit cards is giving him just what he needs to continue hanging himself.

He needs an intervention. Now. Let the compassion come when he is seeking and receiving the help he needs.

[Name removed]

95. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Kansas Wyatt]

148. I bet part of his problem is an inferior complex

And he feels the need to show-off and blow money in front of his new wife, to show her what a man he is.

All of you may laugh, but you would be surprised at how many men are pushed into doing stupid things in today's society:

Caveman days - How much meat I can bring back to the cave for you.
Modern man - How many toys I can buy and how I can surround you with luxuries.

[JerseygirlCT]

155. I think it's possible to feel empathy for the illness, while still

condemning the behavior.

[Jed Dilligan]

67. Credit is like heroin

If it's available and profitable for its distributors, some will inevitably fall prey to its allure.

[nonconformist]

68. Sell the gas guzzler!

He should borrow a truck, if possible, or just rent a truck for his boat trips. That would be FAR more economical. I've never understood the logic in buying a vehicle to accommodate something you do rarely. Crunch the numbers - often times, it's far cheaper to just rent a larger vehicle when needed than driving it day in, day out.

$300/month for eating out? Eeek.

He's clearly living way beyond his means. I sympathize, because it can happen to the best of us, but it doesn't seem that he sees HOW far he's living beyond his means yet. He figures he can keep what he has and just coast and eventually, everything will be okay. It doesn't work that way. You have to make serious sacrifices to get out of a mess like this. Living way beyond your means like that requires you to live way beneath your means to recover.

Bankruptcy is probably a good option for this guy, but it will be a band-aid on a gaping wound if he doesn't realize he has to really change the way he lives.

[crispini]

143. Exactly what I thought, rent the truck.

I can understand he doesn't want to sell his share of the boat since it's already paid for, but trucks are far cheaper to rent that to own!

[RayOfHope]

71. Idiots like this guy make it really tough for people that have debt for other

reasons, ie student loans, medical bills, got laid off, etc.

Repubs (like my dad, unfortunately) will read this story and chalk up any sort of personal financial distress as a result of a sense of entitlement, and ignore the real problem that there are people that are losing the financial battle because of things that are truly out of their control due to bushco policies.

[originalpckelly]

76. Is this supposed to be an allegory for the government?

Is sure as hell sounds like one.

[AlCzervik]

81. lol, you're absolutely spot on.

[Catshrink]

82. Sounds almost like my BIL

He buys "collectibles" on ebay, among other things. My sister won't leave him -- she doesn't want to leave her dog. I don't get it.

[Hawaii Hiker]

84. How do people have 30% rates on credit cards!

I mean, credit card companies ALWAYS send you those offers to transfer your balances to a low rate (sometimes very low rates like 3.99%, 4.99%, etc. & you keep that rate until your balance is paid off, so as long as you keep your account in good standing).....

Unless he was taking out cash advances on credit cards, I don't see how anyone would have a credit card that charges them 30%?!......

[gollygee]

86. It says he goes to Vegas a lot

He was probably taking out cash advances then.

[Gormy Cuss]

93. Easy. Your credit score is low. Your existing cc jacked up the rate because of it.

That's a common practice these days. Your score is also too low to make you an attractive prospect for other cc issuers with the best teaser rates.

It does sound like the financial adviser's advice to try to negotiate better rates has helped him, and that's the last part of the answer: not knowing that you can negotiate lower rates.


This guy's financial house is in shambles and he made a lot of really bad decisions on the way there but if he follows through with the adviser's suggestion to go to a reputable credit counseling service he may be able to dig his way out after a few years.

[El Pinko]

101. You miss or are late on one payment, and ALL The cards go up to 30%

It's called the default rate, and the minute your credit record shows one late payment, all the cards go up and you automatically become ineligible for the 0% balance transfers.

[Hawaii Hiker]

142. Are you serious, if you miss ONE payment or are late,

they raise your rates that f-ing much!...I could see if you missed 3 payments, or something little more serious, but ONE late payment, that's insane..Hell, the law of averages says the US mail is bound to mess up once in a while & could cause your bill to arrive late....

[El Pinko]

151. You don't even have to miss a payment, actually.

My default process began when one of my card companies jacked my rate from 9% to 28% on a $3K balance. I had never been late or missed a payment, so I called them up and asked what was going on. They said "We do periodic checks on cardholders' credit, and if a borrower has too much outstanding debt, we reevaluate the risk and assign them a higher rate". I had no idea that could happen, but with the higher rate, the payments suddenly became a lot less affordable, and one by one the other cards started to reset to the default rate. The funny thing is, I'm kinda glad they did it, because if they hadn't, I would have kept paying the "low" minimum payments for another couple of years before I realized that I would NEVER be able to pay them off, so I washed my hands of it.

There really needs to be massive reform of the credit card industry. Why is it legal to keep giving people more cards when they've already got 80% of their annual income in debt? And why is it okay for them to give you all the cards, then punish you with higher rates? It makes no sense. They should be required to refuse people credit once their outstanding debt is more than 25% of annual income.

They shouldn't be able to jack up rates unless the cardholder has missed or made a late payment, and even then, I think they should have a one-time warning or grace period.


As for the bill being late - almost every card lets you see your statement and make payments online, so I don't know if the mail thing is a good excuse, but people do have unexpected expenses and there should be a LITTLE wiggle room for the consumer.

[BadgerLaw2010]

137. You are considered an exceptionally bad risk. Like this guy, who is basically bankrupt.

[casus belli]

89. Elsewhere in America, a mother is just laying her kids down to sleep...

in a home with no electricity, and no heat. She just spent the last $4.78 she had on Ramen noodles so her kids wouldn't have to go to bed hungry. Luckily, she was able to cook it because the water is still on, but she has received her second disconnect notice and doesn't know how much longer it will be available. She washed her kids clothes with shampoo and they are hung up to dry on the shower curtain so they won't have to go to school tomorrow with dirty clothes. She kisses them on the forehead and tucks them in, then retires to the couch of their one bedroom apartment and cries herself to sleep wondering how she will get to either of her two jobs tomorrow with no bus fare.

Stories like these tug at heartstrings, and they should. Because we live in a world where the plight of people like this is all too real and often ignored, while the guy with the boat and "financial problems" gets his own story in the paper.

edit: grammatical error

[Contrary1]

92. And I remember apologizing to my two children one Saturday...

that even though we had talked earlier about getting a Happy Meal for them, we simply could not afford it. We had less than $15 that had to get us through until the next Friday, and a car running on fumes.

Color me unsympathetic.

[JNelson6563]

96. Tis quite a thing to behold

This sense of entitlement. The very fact there there's stuff he wants is all the reason he needs to buy anything and everything. Sadly stories such as these grow increasingly common. So many believe they are truly deprived if they are denied anything at all.

Julie

[El Pinko]

97. Portrait of an asshole.

You know, I defaulted on several credit cards, and it really sucks, but for the most part, I spent what I spent to feed my kids (and to pay for one long-distance move) because my income simply wasn't enough to pay the rent when we lived in San Francisco. I drove an old economy car, which I bought used for cash.

This jackass buys a gas-guzzling truck - with a loan, buys $100 dinners and on and on and on. And why is he putting money in a 401K? Paying off thad debt would be a much more profitable investment.

Unfortunately, unless he has some real good short-term opportunities for advancement, I think he should just file for bankruptcy already and learn to make a budget. If he's not eleigible for bankruptcy, he should default and wait out the statute of limitations, because without huge income increases, he will be a slave to servicing that debt for the rest of his life - especially if he misses a payment, every damn one of those cars will go up to 20%.

I supported a wife and two kids on less than what he makes paying $400 higher rent, and it took years before the debt got unmanageable. This guy is just starting out.

Seriously, if you're in a dead-end job struggling just to pay the minimums on a bunch of cards, file for bankruptcy or default and wait out the statute of limitations - It takes up to 12 years, but not doing so means you will be paying the minimum them charging your food, then paying the minimum, then charging your food, for the next 40 years, and you will have paid them more in interest and fees than you borrowed by the time you're done. Don't be a slave to the cards.

And be wary of "non-profit" credit counseling services - they are almost ALL run by the credit card industry. If you want counseling about credit, contact the nearest office of ACORN.

http://acorn.org/

[sendero]

102. This guy is the poster child...

.. for what is wrong with American values.

He will eventually lose everything, and I can't feel sorry him in the least. He seems to be a pretty typical American, probably of the Republican and or Evangelical persuasion, who thinks the world or God owes him the good life.

He's spending money in ways I don't spend money, and I have several times his income.

These folks are about to get a serious and well deserved comeuppance.

Guess what jackass, the luxury life is one you earn with years of struggle and nurturance, not one you plastic-whip and hope some miracle will save you.

[Liberal_in_LA]

104. 'lose everything'? Does one really own anything when up to the neck in debt?

He's lucky to get this wakeup call at age 30 rather than age 60. He can recover.

[JosephSchmo]

105. First post, but I'm kinda sickened by the lack of compassion

I thought democrats had that.

[Yavin4]

111. Compassion Is For People Who Deserve It

Selfish people who squander money are not deserving of compassion, especially when their squandering hurts people who legitimately need bankruptcy relief.

[JosephSchmo]

123. So quick to judge

You decide who "deserves", who is "selfish" and is "legitimate". I don't think so. We're all in this together.

[cgrindley]

132. I'll judge him... this guy deserves a kick in the nads

how about credit counseling... I was $40k in the hole after a divorce and now, 5 years later, I'm free and clear of all debt. It really works for stupid and irresponsible people (I was one). Dealing with someone in debt is like dealing with a junkie. No compassion, no sympathy. Just tough love and a kick in the nads.

[JosephSchmo]

159. Thats some great Republican advice.

Tough love. Worked great for Reagan.

[LanternWaste]

147. uster compassion for those who keep drilling holes in the side of our boat

"We're all in this together."

Yeah... and it's tough to muster compassion for those who keep drilling holes in the side of our boat, while we're furiously trying to bail it back out...

[El Pinko]

115. This guy needs tough-love more than compassion. NT

NT

[MiniMe]

114. Sorry he is in such debt, but he is living above his means

He doesn't need the share of the boat, it is something that you hope to get when you can afford it. Without the boat, he can buy a more economical car. Lose the $100 dinners.

I'm in debt now too. Did I buy a few things I shouldn't have? Yes, and I could afford it when I bought those few things. But after that, I had the year from hell. Between expensive car repairs, and dental bills (even with dental insurance), things piled up. If I could go back and undo those several things, I would. But nothing I can do about dental and car repair bills. But I have made the decision that no vacations that I can't pay in cash for now. And I budget for a dinner out occasionally, but very occasionally. Don't mean to make this a sob story for me. But I am trying to do the things I need to do to get out of this mess. That is what he needs to do.

[Yavin4]

118. About The $100 Dinners

There are several eating options that one could go to without spending that much money. You really have to go out of your way to spend that much on dinner.

[Bill McBlueState]

122. What is the purpose of this article?

It seems like this guy's just being tossed out as a way to make other people feel better about their own decisions. Witness most of the responses here.

[sandnsea]

128. No, it's a way to dismiss real hardship

As long as people have this guy to cluck cluck cluck about, they'll rationalize that everybody who can't make ends meet is just like this guy.

[Omphaloskepsis]

129. The guy agreed to the article..

I don't know why he did. I certainly wouldn't have.

[Bluebear]

127. Hell's bells, glad everyone is so perfect. Don't show even a little compassion for someone who

got in over his head, now.

Plus, thanks to the bankruptcy laws co-enabled by our Democratic congress, there isn't even a second chance for ordinary folks. Of course, you can write off all your debt if you're a corporation. Quelle surprise.

[BadgerLaw2010]

138. This is entirely self-inflicted. Why should he get sympathy?

[Bluebear]

145. I have compassion for people in distress, period.

[Mountainman]

149. Everyone's life is his/her own self-infliction. Some of us get sympathy some don't.

[JerseygirlCT]

157. Why should this guy get a second chance?

He wasn't struck with crazy medical bills or rebuilding after a natural disaster... He went to Vegas a lot, bought a boat and a truck and a ring and took a nice vacation.

He borrowed that money from other people. Now he needs to pay up. He's in over his head because he "wanted" over his head.

He may have some psychological problems, but he needs to just stop. He doesn't need to be enabled further by writing off his debt.

[cgrindley]

131. What an idiot

why should we give a shit about this moron?

[RandiFan1290]

134. Sounds like my neighbor

He is 33 and it took him over 10 years to finish a finance degree. In that time he blew through over $250K of his mother's malpractice settlement, $300K of equity in a house that was supposed to be sold to help his disabled mother(the house belonged to his grandmother and when she died he talked his mother into signing it over to him so they didn't have to pay the taxes. He refinanced it behind his mother's back.), tons of credit card debt, and tons of student loans. He used all of this money to keep up an image of the young millionaire! He insisted on designer jeans that cost about $400 a pair and various other accessories to drive around in a 2007 Mercedes. He refused to get a job and now that school is finally over he realized that his simple finance degree isn't getting him the millionaire's job that he's dreamed of all these years. He has even started to spend the equity in his mother's house. She refinanced twice and was trying again this year in order to give it all to him. It was refused and now both houses are in danger of foreclosure. He spends every night at his mother's house eating her food and watching her cable. His poor mother lives on the edge of poverty. The only reason she can survive is that she has taken in 2 roommates to help her pay the bills. She can't even afford to buy herself new clothes so she has to wear her mother's clothes that were left over after she died. He refuses to change his lifestyle or sell the Mercedes.

[Vickers]

135. "I'm at my wits' end"

:rofl:

No shit, buddy!

[lakeguy]

152. idiot.

there really is no excuse for this kind of behavior.

[JerseygirlCT]

153. WHY do people do this to themselves?

Just thinking about it gives me hives.