Am I an economic girlie-man?

A while back a credit card company gave me $5,000 in credit, which I promptly took to a casino and lost. I’ve been making my payments regularly. I’ve never been late with a payment, missed a payment, or made only a minimum payment in my life. Usually my credit card payments are more than my rent.

While it is true that I gambled the money and lost, they gambled also. They know full well that I am low-income, on Social Security, and own no property. Should I default, I am judgment proof as I have no income or property that they can attach. Nor can I be evicted.

The statute of limitations is four years. If I stop making payments, 4 years from my last payment the debt must be written off and I will no longer owe them anything. So far, because of the interest, I’ve paid them $1,000, which has reduced my debt by $500. So, even paying as much as I can every month, which means that I do without many necessities (I still don’t have a bed, a vacuum cleaner, etc.), I’ll have to repay at least twice as much as I borrowed.

Ah-nold’s convention speech has gotten me to thinking. Why should I care about deficit spending? Why should I bother paying off my debt? I have no heirs it can be passed on to. If the company sues me and gets a judgment against me, the only way they’ll ever collect anything is if I win the lottery. I seldom even buy lottery tickets, so that is unlikely, and if I did win, I’d be happy to pay them.

I never plug my phone in unless I want to make an outgoing call, so they would not be able to harass me with phone calls. I’m retired, so they cannot contact my employer or garnish wages. As far as I can see, there is nothing they can do except get an unenforceable judgment. The only reason I’ve been paying them is because I have this habit of paying my debts. Habits can be broken.

If I stopped paying them I could buy a bed, a vacuum cleaner, a new hair clippers (mine is so old that my head bleeds every time I use it), and I’d be able to eat better and more regularly. I’m not worried about my credit record. I have good credit with other companies that I wouldn’t lose, and only one other credit card from a company so good that they wouldn’t raise my interest rates if I defaulted on another debt, the way some companies do these days.

I have almost a month until my next payment is due in which to make up my mind. Do take into consideration that if I make smaller payments (my current monthly payments are more than my rent) I’d end up paying them 3 or 4 times what I borrowed because of the high interest. They are, I believe, the biggest credit card issuer in the country, so they really don’t need the money. So, what do you think? All advice is welcome.

Look at getting a low-interest loan to pay it off.

I'll still have more than enough credit. As I said, I have another credit card, from a company that won't raise my rates if I default on another debt. And I have charge cards at Nordstrom's, Wal-Mart, and Office Depot that I won't lose. At my age, I don't really need credit--I might not live long enough to pay this off anyway.

I'm not planning to buy a house or a car. I'm in subsidized low-income senior housing, and play to stay here until I die, if I can. Should the chimp get re-selected and cut HUD programs, I've already decided that I'd kill myself rather than be evicted onto the streets. There is no way on earth that I could afford non-subsidized housing on my SSI.

I have, and would continue to have more than sufficient credit. What I don't have, and would have if I stopped payments, is a better standard of living.

cut up all of those damn cards NOW...Do not order another credit card for the rest of your life.

If you can't afford something, don't buy it. Start making minimum payments on everything but the smallest debt...Attack it with a vengeance and kill it. Then move up to the next smallest debt...Get a snowball going and before you know it you will have killed every penny of that $5k.

It also sounds like you need to start tossing pizzas on the weekend.

It won't be fun, but you could take home $100-125 a night in tips + salary. That would help now wouldn't it?

You are in a mess...Time to cut back...go absolutely nuts for six months, dig yourself out, and never go back.

Anything I earned over $25.00 a month would have to be repaid to SSI. (They don't take the whole amount, they only take half, I think, but since the other half is taxable, I wouldn't get to keep all of it). And then my rent would be raised due to my extra income. If I earned as much as you suggest, I'd probably end up with an additional $50 a month that I could use for diminishing my credit card debt. But since I'm disabled and cannot work, the question is moot anyway.

I've gone through this before, running up a debt in a few nights at a casino, and then spending years paying it off. What I've never done before is consider not repaying it, but who wants to be an "economic girlie-man?"

this is the best illustration I've seen in a long time.

:yourock:

to see if you are honest and trustworthy.

At one extreme, you describe a rightwing Arnold worshipping wacko GOP party hack. At the other end of the spectrum, you place an honest Democrat.

I think you know which one you want to be. Sorry about the bad luck. The year they legalized gambling in my state, when my dad was first diagnosed with dementia, he lost $8,000 in a card room. He had to cash in his savings bonds. My mom chased him with a butcher knife.

Gambling is risky when you can cover your bets. It's suicidal when you can't.

payments, it's charged off in 6 months. That is the date that the banks have to make a decision to collect from the FDIC insurance they pay into or go after you. Your tax paying dollars at work. I actually am in a program like that. Unemployment has taken it's toll. The banks are some of the biggest contributors to Bush. They've bribed the government to allow then to charge whatever they want for interest. The real big banks like Citicorp and MBNA don't even have to make payments to the FDIC - they've talked them into allowing them not to pay insurance because they are so big they won't fail. So the FDIC has people on site to make sure. More tax payer dollars.

About 14 years ago Social Security notified me that I owed them $23,000. Since I actually didn't owe them any money, and couldn't have afforded to pay it if I had, I was forced to file for bankruptcy. Six years later Social Security admitted that they had made "a mistake." But by then I had a bankruptcy on my credit record. It took me 3 years to reestablish credit, 5 years to regain an excellent credit rating, 7 years for the bankruptcy to come off my credit reports, and 10 full years for the whole thing to disappear as if it had never happened. While Social Security did admit their mistake, they could do nothing to repair my credit rating. But since I'm not looking to maintain a good credit rating any more, and not seeking further credit, this time it really wouldn't matter to me.

they should do that. the other companies with whom you have credit will f you up if they find out you're screwing a brother creditor. and they WILL find out. it's a debt. you owe it. you signed an agreement to pay. if you are ABLE to pay, imho, it's the honourable thing to do...
get a lower interest rate, make more than the minimum and it will go away by itself.

you never know when having no R9's showing on your credit file will come in handy....

They won't lower it. But they did tell me a while back that if I ever used their card again, or was late with a payment to them or anyone else, they would raise the rate to over 21%.

But my other credit card company will not raise my rate if I default on another loan. As far as I know they are the only credit card company that doesn't do that these days.

So....I already have a low interest rate and make more than the minimum payment, but the debt won't go away for several years, if I live that long. And I don't know why a good credit rating might be handy--unless I wanted to go to a casino again, which I do not.

maybe you'll need to take out a loan to get something fixed.

and again...i point out the 'network' effect. you default with them...at 60 days, with no word from you, they will grab up your CBR, and call everyone one the file. then they will keep an eye on the credit you have with them
at around 90-120 day pd, the rest of your creditors may start restricting use of your accts with them, even if you have great credit with them. around 180 days, (write off time) you may get closure notices from companies who have kept an eye on the proceedings...

anyway i already told you what i thought.. ultimately it's your decision.
But would it make you feel good to know that Ah-nuld convinced you to trash that part of your life? I personally would not want to give him that kind of power over MY life...

I don't own anything. My building does repairs if the plumbing leaks. And I have Medi-Care and Medic-Aid, so if I break, they fix me for free.

Now if other creditors restrict my accounts, it still shouldn't be a problem. I'd just have to send checks for things I usually buy by credit card.

But, now that I think about it, from reading the responses here it is clear that the company is insured and wouldn't actually lose any money.

The taxpayers might have to pay for it, but what with Halliburton overcharging in Iraq, most tax money is going to be occupied elsewhere--only whatever tiny fraction doesn't go to war profiteering could be used for anything else.

I agree that Ah-nuld shouldn't have power over my life, but even a blind pigs finds an acorn once in a while. What if this time he's right?

or anyone else for that matter, to default on your debt.

you posted this as a question after you had decided to default on the obligation you agreed to pay. why bother involving us in this exercise in futility?

i don't care what you do.

We're in Rome. May as well do what they do.

Give me a fair world and I'll be just as fair in return.

they end up with more control over you than they had before.

I mean, what can they do me? It isn't as if I had a life or anything. I can't lose the job I don't have, the car I don't have, the family I don't have, the friends I don't have--and I rather doubt that they'd want to take away my computer because it isn't new or fancy.

If I HAD any control over my life, I might be worried. As things stand, they can't get blood from a stone.

why do you care what anyone else thinks?

Habits can be broken, but they are HARD to break.

I have this habit of going online every month and paying all my bills.

To not pay one of them would be difficult, but probably not impossible. I've managed to break some habits before, but there are some I can't break. It usually depends on whether the upside outweighs the downside. In this case the upside looks very good, and I can't see much of a downside.

But, like I say, chances are that when the end of the month comes around, I'll just continue doing what I do every month. Only this time I'm going to have Ah-nuld's words ringing in my ears, telling me that I'm an idiot. So I've been thinking and thinking and thinking about this, and I finally decided to ask for help.

I'm finding it fascinating that opinions are nearly evenly divided. But you never know on DU. Somebody may come up with a clincher that helps me definitely decide one way or the other.

I am in a similar situation as you, exept I am young and have decades of pain to endure.

:hug:

You are now the only person on my buddy list.

When I was young I never dreamed that I might have financial dilemmas. I was mostly broke and homeless, and guess what? I was mostly happy. Yes, there was a lot of pain, but there were also a lot of friends, a lot of sharing, and a lot of joy.

Returning the :hug:


:you rock:

Don't listen to the young whipper-snappers that admonish you for not paying your debt. They can afford their debts. We cannot. Many folks here on DU could put their money where their mouths are and help folks like us out. If I didn't have a family, I would be living on the street, completely hopeless. If I can finish my PhD, I might have a chance in this life for a decent life... I am trying sooo hard.

Please keep posting. You have a beautiful mind.

For those of us who are disabled, poor, and disenfranchised in the New Rome, I say fight back any way you can.

and pretty straightforward. And is has nothing to do with any of the items on your poll. It's simply the difference between right and wrong. If you incurred the debt, and you owe it, then you should pay it. Do the right thing. Simple as that..

Paying it back is just the right thing to do.

You understood the terms of the agreement when you borrowed the money. Not paying it back is stealing. And might I suggest that you stay away from the casinos from now on. They are nothing but trouble.

On edit: If you are having trouble getting the things you need, just consider making the minimum payment for a while so you can get what you need. There's no reason to put yourself in a hardship when you don't have to.

Any month I make a minimum payment, interest accrues on the remainder of the debt. Make minimum payments for a few months, you end up paying 5 times as much instead of only twice as much as you borrowed. As I understand it, on a debt of less than $1,000, at slightly under 20% interest, with a minimum payment of $20.00 a month, it takes almost 20 years to pay off and ends up costing at least $4,000.

Under my state law, the statute of limitations is up in 4 years. Since, even paying the maximum I can, it will take me almost that long to pay this off, I can see a benefit in not doing so. I can't see any benefit in paying it, as I am not going to be lying on my deathbed with a huge credit card company on my conscience, knowing that they already got the insurance and didn't lose a dime. And I am not concerned about my credit rating because I can't afford to prepay for my cremation anyway, so the authorities will just have to dispose of me like any other pauper.

Does not excuse the responsibilty that you have to make the payments to the company. It sounds like you have already made up your mind not to pay it off. You just better hope that you do not need to borrow money again in the future because you are probably not going to get the loan if you default on this credit card.

Fuck 'em. Get a bunch of cards max them out/withdraw a lot of cash and pay them back a few dollars a month until you pass on, or pay them nothing at all. If they try to collect just laugh at them and say, "welcome to the downside of capitalism!"

to increase my credit limit, and I turned it down.

But as I understand it, capitalism doesn't have much of a downside these days, as least not for the big corporations. I seem to remember a Chrysler bailout, S&L bailouts, and a lot of other bailouts. The way it works is that companies get tax breaks because they are investing their capital, and then when they lose, the taxpayers have to bail them out.

Thank you all for your kind advice.

I think I might be able to have my cake and eat it too.

I've decided to keep making my large payments AND to accept the other company's offer of a credit limit increase.

That means that I will be able to buy a bed, a vacuum cleaner, and a new hair clipper on credit, without having to increase my monthly payments. I will be going further into debt, which means more deficit spending, so in that sense, I'm not an economic girlie-man, but I will continue paying off my debts, so in that sense I am definitely an economic girlie-man.

I'll probably buy a 2nd-hand vacuum, a used bed-frame, and a new mattress set (probably discount or mismatched) and a new hair clipper. In all, I'll only be increasing my debt load by less than $200, which means extending the pay-off time by only a month. When we're talking about several years, a month isn't very much. I will have a slightly better standard of living, but, of course, not as good as it would be if I stopped paying.

So, I'm compromising instead of standing on principle, and I do feel like a girlie-man, but not because I care about deficit spending (my own and the government's). I feel like a girlie-man because I'm wasting some of my last years on earth paying off a company that is fully insured, wouldn't lose a dime if I didn't pay, doesn't need the money, and shouldn't have issued me the card in the first place.

More people advised me not to pay than advised me to pay, so I think it is obvious that this was not an easy issue to address. Sometimes it is really difficult to think something through alone without anyone to talk to, so I am really grateful to everyone who helped, whether or not I took your advise. I did take everyone's advice seriously, and I was careful to take everything I could into consideration.

Ultimately, I did not base my final decision on reasons, but on feelings. If that doesn't define a girlie-man, nothing does.