Sunday, November 22, 2009

10 Dumb Ways to Separate Yourself from Your Cash

Obviously there are lots and lots of ways to separate you from your hard-earned cash but here are the most brain-dead ways to practically give your money away to a bad cause:
  1. Rent to own places. Ayayay. Every time I see a rent to own place's delivery truck go by I want to follow it to some schmucks house and lecture them on topics financial. If you can't pay cash for something, wait until you save up the money so that you can pay cash, in full, for the item. These places are especially horrible because they charge four or five times the going rate for their wares (TVs, sofas, etc) and people actually PAY it. Dumb.
  2. Payday lenders. Another horrible business that takes advantage of people who can't do math. What part of 400% interest don't they understand? Taking out a payday loan will suck you into a never ending cycle of get loan, pay back loan out of next check, run out of money, take out another loan. Rinse and repeat.
  3. Credit cards. See previous post about credit cards. High interest rates, universal default clause, over limit fees, annual fees, late fees....need I say more?
  4. Leasing anything. Especially cars. People take out leases because it is a lower monthly payment way to get a car they can't afford. So you end up at the end of a five or six year lease and still owe half the cost of the car. Bad idea.
  5. Loaning money to friends and family. Never, never, never do this. If you can't afford to give the money to the person as a present, don't loan it because you probably won't see your money or your relationship again.
  6. Co-signing for anything. Again, never, never, never do this. The person needs a co-signer because their credit is bad. Their credit is bad because they don't pay back their debts. If you co-sign for their debts, they won't pay and you will end up with the bill.
  7. Doing illegal stuff. Driving without a license, having expired car tags, getting a DUI...if you do something that is against the law, expect to get caught and pay through the nose for it.
  8. Taking on more debt than you can afford. People who end up with house payments that cost 50% of their monthly income, car loans that are nearly four figures, and other debts that are way out of line with their income will end up bankrupt AND without the item they paid so much for.
  9. Taking part in any kind of get rich quick scheme. If it was so easy to get rich quick do you think the people who are offering the information/class/item would be doing the work to get you involved? Wouldn't they be off enjoying their money some where? If a deal seems too good to be true, it probably is.
  10. Trying to impress others. In order to impress others we usually buy stuff they (and we) can't afford to look better/richer/more impressive. This is a quick way to financial ruin. Better to impress people with your wisdom than stuff you can't afford.

OK. I'm off my soapbox for today. rocks!


  1. I found your blog through the Enemy of Debt blog. I read all of your posts. I have been hoping to find sources of inspiration in my "get out of debt plan". I am really excited to hear about your journey. It's so nice to see others making the decision to stop being slaves to lenders. I have a large family but I still think being debt free is doable and the only financially sound thing to do. Thanks so much for starting this blog!!!

  2. I may have to print these and post them somewhere public where others can see. These are really sound advice.