« Take Responsibility for Your Money Problems | Main | Paying Kids to Study – Does it Send the Wrong Message? »
Is it Really That Tempting to Sign Up For New Credit Cards?
By JLP | January 23, 2008
LivingAlmostLarge left a comment on my Stupidity post, alerting me to a blogger who pretty much blames everyone except the borrowers for the mortgage crisis. So, just for fun, I went over and checked out their blog. While I didn’t find too much about the subprime crisis, I did find this post on credit cards interesting, especially this part regarding credit card offers:
When I stopped using credit cards in 2001, this is what my mail looked like for one year after I canceled my accounts: I was bombarded daily with unbelievable credit card offers! It’s been seven years and I must have received thousands and thousands of offers! Don’t blame the credit card companies for people defaulting on their accounts? Who in their right mind can stand up to all these constant, constant ‘too-good-to-be-true’ offers? Eventually you cave in.
I guess only the strong survive. Something tells me that if a person can’t resist credit card offers, then they have self-control issues. Seriously, if you have a problem with these “enticing” offers from credit card companies DON’T OPEN their envelopes! Instead, take them from your stack of mail and SHRED them before you open them.
I don’t have anything against this blogger (in fact I mostly like this post), but I have to say that this is a classic case of the victim mentality. To this person I’d like to say to repeat after me:
Thanks, LivingAlmostLarge, for the link.
Topics: Credit Cards | 14 Comments »
January 23rd, 2008 at 2:31 pm
Guess we are both thinking along the same lines today.
PS I have a friend who wanted to go to Banana Republic on Sat, apparently because she has a credit card there. When she decided to buy a shirt I offered her a $10 gift card I had that I knew I wouldn’t use. She brushed it away at first, saying “it doesn’t matter; I’m paying with my credit card.” I couldn’t resist reminding her that using credit cards is spending real money.
Later I winced when she wanted to eat at the Nordstrom Bistro because she has a Nordstrom card – “and that one’s not maxed out!” I told her we are NOT going shopping anymore and later gave her copies of 2 of my favorite PF books. What on earth is the enticement of these cards for people?! Do they really not think it “counts” as spending money? She works at a bank too!
January 23rd, 2008 at 3:13 pm
How to “resist” these CC offers:
1. Buy shredder. About $25 for a cheap one from Target.
2. Put shredder near front door.
3. Throw all junk mail in shredder immediately upon getting it out of the mailbox.
4. Be sure to put shredded CC offers into paper recycling; gotta be Earth-friendly!
5. No worries, mate!
January 23rd, 2008 at 3:32 pm
when I was younger I felt the same way as this guy. I was in debt and with ever new offer of 0% introductory rates I thought “awesome, Ill do a balance transfer and pay this off!” then I did the balance transfer and racked up more debt. The offers look good, really good at times, but I do exactly what is posted. They get shredded even before I open them because I don’t need another credit card, and if I ever need another one, i’ll go research one online adn get the rates I want that way.
January 23rd, 2008 at 4:04 pm
I have yet to see a credit card offer that’s too good to refuse. I opted out of credit card offers by going to OptOutPrescreen.com. Much more room in my mailbox now!
How did this guy become a millionaire if he never learned to ignore credit card offers?
January 23rd, 2008 at 4:29 pm
Meg – pity the guy that catches her…
Anyway, we’re moving to a cashless society, which is to say we’re shifting over to being nearly all plastic. Cash will never go away, but it’s use will diminish considerably.
Just thinking about that shift underlines how important it is to make education on its use mandatory.
Unfortunately, teaching kids about credit card use (and abuse) reminds me of sex education: left to the parents, if often doesn’t get done. Or it gets done *after* that conversation that starts with “Mom? I’ve got a big problem…”
And even after that it often doesn’t get done right.
Credit was an enemy for me until I set up a very simple system: I use the card for anything over $10 because I get the award points they offer (good for a couple plane tickets each year), and then every two weeks pay off the balance every time a paycheck rolls in. If I splurge (and I do), it’s gets thrown back in my face by the next Friday.
That may not work for everyone.
January 23rd, 2008 at 5:04 pm
It’s ludicrous to blame the credit card companies. Not only do you have to open the envelope, fill out the long-ish form, and mail it, you also have to receive the card, activate it, and actually use it!
Also, you can opt-out of the offers.
January 23rd, 2008 at 6:30 pm
I would just put them through my parents’ shredder. So far they haven’t found me at this address (I believe I opted out…it’s working so far). And my parents have instructions to shred anything from Capital One (the people most interested in giving me such a card).
January 23rd, 2008 at 9:47 pm
Even better, you can eliminate receiving the things all together. Check out the FTC’s website at http://www.ftc.gov/bcp/conline/pubs/credit/prescreen.shtm for information on how to get off of these lists. It beats shredding!
January 24th, 2008 at 9:30 am
I have a elder relative who is very dear, but a complete and utter walking money disaster almost by design. She has filed personal bankruptcy at least 2-3 times. When she gets a CC offer in the mail, she sees it as free money. I kid you not. She will max it out, figuring that its only a matter of time before she will file again and wipe the slate clean.
In her mind, if the CC companies are dumb enough to send her cards, and the law will allow her to dodge her obligations, then where is the harm.
January 24th, 2008 at 9:37 am
Miguel,
Wow! That’s crazy. Unfortunately, your relative isn’t the only one who thinks this way.
January 24th, 2008 at 11:05 am
#10 – The funny thing is, she’s probably right.
If she already has a home (protected under bankruptcy), then the only thing she loses is her credit score (which most people are concerned about primarily for its impact on buying a home). The credit cards effectively ARE free money for her.
I think this sort of situation was the driver behind the bankruptcy reform of a few years ago. Of course, my thought then (and now) was that if the card companies were that concerned about recovering their loans, all they need to do is tighten their credit standards.
January 24th, 2008 at 12:07 pm
IG, That is exactly the way she sees it. She does own her own condo (acquired with proceeds from a settlement if I remember correctly). I’ve never met anyone who put so much effort into getting over on the system. i think that there are many people like her out there. It’s not all fun and games though – the dark side of this type of grifter lifestyle is that it is very stressful and of course, morally bankrupt (pun intended).
Believe it or not, she is a wonderful human being in many other respects. Scary, ain’t it.
January 25th, 2008 at 9:15 pm
I don’t see credit cards offers as any different from any other sales pitch or sales materials one gets in the mail. If one cannot resist credit cards, how would the same person resist all of store “specials”. This reminds me of a collegue who complained that his wife bought a $2000 vacuum cleaner because “the salesman looked nice”, although he was not much better. It seems to me that learning to resist any kind of sales pitch – be it credit card or an item one doesn’t need – is a basic requirement of being responsible with money.
Personally I look at this flyers. I compare their cashback with cashback I currently get, if it is greater I might consider it. When I get 0% offers, I spend a little time considering if I want to bother with arbitrage. Haven’t done it yet, but sometimes I think about it. After that, I shred the offer and throw it away together with zillion of sales brochures I get. I also got a travel brochure in a mail once inviting me to buy a tour of Europe on a private jet for 50K (or something like it). Shall I be angry because this brochure tries to make me spend 50K on one trip?
But really, nobody forces anybody to get credit cards, and nobody forces anybody to use it to buy stuff one can’t afford.
March 26th, 2008 at 7:17 pm
What really annoys me is the CC companies that put in the fake “your name here” credit card. It just aggravates me to no end to have to open it up and send that fake card through the shredder separately.
So – if someone would be so kind to post the model number of a shredder that can chew through a small town phone book…I would be ever so grateful!