Iâ€™ve made some pretty dumb debt decisions in my life. Iâ€™ll list my â€œTop 5â€³ starting with the â€œdumbâ€ and finishing with the â€œdumbestâ€.
Dumbest Debt Decisions Ever: #2
I moved out of my parents’ home when I was 21, after getting my first “real” job. I moved into a new house, but I didn’t own many pieces of furniture. The house had three bedrooms, a kitchen, a den, a living room, and two bathrooms. Everything that I owned at the time, I brought to the new house in the back of a Ford Ranger Pickup Truck. So, when I say that I didn’t own many pieces of furniture, I really mean to say that I only owned a full-sized bed, a dresser, and a television set. I needed some furniture. One of the guys from our church owned a local furniture store, and he told me to “come on down, and I help you get some stuff for your house.” So, I went down and picked out: a new sofa, a new love seat, a new recliner, a new chest of drawers, 2 lamps, 2 end tables, and a bookshelf. To this day, I don’t know what the actual sticker price of these items was. I thought that I was getting a “deal” and that I could just pay for the furniture over time, without having to worry about interest of finance charges. Boy, was I completely wrong. About two weeks later, I get a bill from the furniture store for over 4500 dollars. Mind you, I was making about 20K a YEAR at that time. I freaked OUT. I had a car payment, credit card debt, and various other bills, and now, on top of all of that, I had a 4500 dollar furniture bill! It took me years to pay for all of the furniture. The week after I finally made the final payment, I received a call from the guy who had “gotten me the deal”. He stated that there were some errors in the paperwork and that I still owed two hundred dollars. Not knowing what to do, I scrounged up the money and made the additional payment. To this day, I have no idea how much interest I wound up paying.
I purchased items that I did not “need”. Sure, I needed furniture, but not brand new, name brand, full priced, financed-at-a-high-rate furniture.
I did not read the papers that I signed.
I trusted the advice of someone that I hardly knew.
I borrowed money without understanding the short- or long-term consequences.
In the end, I was never all that fond of the furniture that I purchased! I just bought that stuff that the sales clerk suggested!
Parents, before your kids “move-out”, be sure they understand how to manage their money!
Young people, before you are “pressured” into making a purchase, even by someone that you think you can trust, take the time to understand EXACTLY what you are doing!