Model railroading yourself into debt...

[Anonymous]

At my LHS ,if I see something I like, I use the layaway plan. I put maybe $10 - $20 a week on something. Sure it takes longer,but I dont run myself short that way.I don't have a credit card,cause (I have a wife that likes to spend.)Thats a smart choce rite there.( hahaha)[oops]

[Anonymous]

Good advice here. When I changed over to a "student bank account" a couple of years ago I was astonished by the number of credit card offers the bank made. All of them went straight to the shredder, but I do know people who accepted them and now have a hefty credit card balance to add to their student loan, all of which they'll have to pay off. I just feel that banks are being thoroughly irresponsible in giving cards to people who cannot afford them. As a standard part of the account I got a debit card, which has no interest fees and is accepted everywhere I shop. All the security benefits of not carrying large amounts of cash around but with none of the potential dangers of a credit card - why would anyone in my position need more?

I do wonder if the lenders are in for a hefty shock in about 40-50 years time. Apparently people are taking out loans that they have no chance of paying off (but they can meet the minimum monthly payment), so what happens when they die? I suspect a lot of credit providers will probably go under as they suddenly have to write off considerable debts.

[sebamat]

I will sound like a old time moralist, but I am amazed of how many peoples here on the forum have had experiences of heavy debit loads.
Probably we are not used because here in Europe until few years ago Credit cards were mostly only for businnes peoples and world travelers (I got my firt CC because of car renting in my US vacation). Now it is changing, and yung peoples also started having heavy (for their financial capacity) debt loads.

During my student time I spent a lot for trains, but I had to cut all the other spending(partiing, movies, no car, etc) ... call me nerdy!
Beside that, the compulsory army time gave me some money reserve (very low wage, but not easy to spend when in the wilderness).

[jondrd]

QUOTE: Originally posted by Railroading_Brit

Good advice here. When I changed over to a "student bank account" a couple of years ago I was astonished by the number of credit card offers the bank made. All of them went straight to the shredder, but I do know people who accepted them and now have a hefty credit card balance to add to their student loan, all of which they'll have to pay off. I just feel that banks are being thoroughly irresponsible in giving cards to people who cannot afford them. As a standard part of the account I got a debit card, which has no interest fees and is accepted everywhere I shop. All the security benefits of not carrying large amounts of cash around but with none of the potential dangers of a credit card - why would anyone in my position need more?

I do wonder if the lenders are in for a hefty shock in about 40-50 years time. Apparently people are taking out loans that they have no chance of paying off (but they can meet the minimum monthly payment), so what happens when they die? I suspect a lot of credit providers will probably go under as they suddenly have to write off considerable debts.

[2c] [soapbox] If it even appears as a possibility that a lot of credit providers would go under your Congress will bail 'em out(for the good of the country). They bailed out the Savings & Loans when their excesses could no longer be sustained. They bailed out a hedge fund for the good of the country. The credit lenders are well represented in D.C. the most recent example of the effectiveness of that representation is the tightened bankruptcy laws. Oh, oh, clear the decks; Ford & GM may need some public assistance. Bottom line hurting? Walk away from your pension obligations-not a problem, there's a federal agency which will guarantee your plan's obligation at taxpayer expense.

[soapbox] There doesn't seem to be any fall back positions via the federal government when those who are irresponsible with their credit have to pay up to 29.99% for late payments. Didn't there used to be laws against excessive interest? If the laws are still in effect the ceiling must have been raised. That lobbyist sure is an effective fellow isn't he?

And so it goes..
Jon

[Anonymous]

Somebody may have already mentioned this... However, closing the account is the worst thing you can do. It will lock you into whatever interst rate was at that time. So when you start trying to deal with the account, it becomes a lot harder to try and do anything about lowering the rate.

[DigitalGriffin]

Part of the problem is that there are a lot of kits that are very limited run or out of production. So it increases that "Got to have it now before it disappears" mentality. (BLI comes to mind. So does some Walthers models)

That's how I ended up spending $1500 in the last 2 months. (Still wish I could find that Walther's Bascule bridge) Luckily I do have the spare cash handy thanks to a very hefty Christmas bonus which I am greatful for.

[IRONROOSTER]

QUOTE: Originally posted by DigitalGriffin

Part of the problem is that there are a lot of kits that are very limited run or out of production. So it increases that "Got to have it now before it disappears" mentality. ...

Been down that road. Fortunately, I now have enough limited run items that I don't need any more. Cuts my spending way back.
Enjoy
Paul

[davekelly]

In actuality, I don't think credit card companies are that concerned with getting the principle back. With the high interest rates handed out to late payers etc, credit card companies can get their money back even when a debtor defaults on what appears to be a large balance. At 25 or 29 percent they are pretty set. That is why the minimum payment only covers a very small percent of the principle balance. As long as it is getting its interest covered, they are pretty good to go.

[cwclark]

QUOTE: Originally posted by DALCruiser

Chuck

I don't know about Texas, but in California it doesn't matter if the CC's are in your spouse's name: If you're married the debts are owed by both persons. Here if your wife runs up a bill for $100,000 in her name, YOU owe the debt!!![banghead] The only thing that can get you off the hook (possibly) is if they run up a big debt a couple of days before filing for a devorce. A friend of mine had this happen when his wife bought a new car then filed for devorce 2 days later. The devorce Court Judge really chewed her out and told her SHE was to pay for the car herself[:D].

Dave

yes, it is the same here in texas..it's a "community property" state..one married person can get a card, go to town with it ,and the other is responsible even if they are in the dark about the whole mess..that's why it took me a long time to pay off what she created on the credit cards... once i found out it was a tad bit too late...once i got rid of her and the card debt, things began to get back to normal again...if anyone of you are still young and unmarried, a word from someone that's been there..."choose your mate wisely"...the wrong person can really mess you up financially as well as emotionally...you older guys know all about the hindsight...sheez!.....chuck

[davekelly]

QUOTE: Originally posted by cwclark

QUOTE: Originally posted by DALCruiser

Chuck

I don't know about Texas, but in California it doesn't matter if the CC's are in your spouse's name: If you're married the debts are owed by both persons. Here if your wife runs up a bill for $100,000 in her name, YOU owe the debt!!![banghead] The only thing that can get you off the hook (possibly) is if they run up a big debt a couple of days before filing for a devorce. A friend of mine had this happen when his wife bought a new car then filed for devorce 2 days later. The devorce Court Judge really chewed her out and told her SHE was to pay for the car herself[:D].

Dave

yes, it is the same here in texas..it's a "community property" state..one married person can get a card, go to town with it ,and the other is responsible even if they are in the dark about the whole mess..that's why it took me a long time to pay off what she created on the credit cards... once i found out it was a tad bit too late...once i got rid of her and the card debt, things began to get back to normal again...if anyone of you are still young and unmarried, a word from someone that's been there..."choose your mate wisely"...the wrong person can really mess you up financially as well as emotionally...you older guys know all about the hindsight...sheez!.....chuck

Wise words!! Of course my "new" trade up wife is way cool. She loves that I have a hobby, always suggests that we go to a hobby store when out of town, thinks its cool that my trains now have sound and got me a good deal on three sheets of 1 inch foam (she works for an insulation company).

[aloco]

Topics like this really annoy me. Suppose I were to start a topic about a model railroader I know who hoards locomotives? He doesn't run them, he doesn't put them on display, he just hoards them. Sure, I think it's silly, but should I worry about it? I've got more important things to think about, like running trains.

[dragenrider]

QUOTE: Originally posted by aloco

Topics like this really annoy me. Suppose I were to start a topic about a model railroader I know who hoards locomotives? He doesn't run them, he doesn't put them on display, he just hoards them. Sure, I think it's silly, but should I worry about it? I've got more important things to think about, like running trains.

Ah, but money is the deciding factor in the intensity of our model railroading. Money, or the lack there of, often determines our direction as our layout and skills evolve. The decisions we make based on our funds often determines the outcome of our product. Buying used Atlas track versus new Micro Engineering turnouts, for instance.

The glitch comes when a modeler can not separate out his hobby budget from his financial obligations in life.

[CP5415]

I did once.
I racked up almost a G note in one month. That was 4 years ago.
Never again have I done that.

Now, it's usually cash.

Gordon