Money Too Tight To Mention.

My neighbour, Lawrie, whom I’ve mentioned before – young, idealistic, budding political activist – has an older sister. Kristen is 24 and still lives at home, which is probably a good thing considering her spending history. On the weekend she came clean with her parents, it was an intervention of sorts. She has a $32,000 credit card debt spread over three different cards. She can’t pay it back on her salary as a marketing assistant. Six thousand dollars of that debt is for mobile (cell) phone bills.

Kristen is stressed. The weight of regret shadows her eyes. She stays up all night, putting the kettle on over and over again, drinking herbal tea in the hope it will lull her to sleep; locking herself in the bathroom when the phone rings.

In the past I have used my credit card to pay bills if I have been in-between jobs or in a tight spot. But Kristen has been using her credit cards to do little else than indulge herself. Her wardrobe would make any red-blooded fashionista swoon, her make-up could transform the faces of an entire village, her digital cameras and other electronic accessories are top of the range. Her mother is furious. “All this stuff,” she says. “It’s meaningless in the end, even more so if she can’t afford it. How did she get to be so reckless? She was so sure-footed as a child. She moved through the day with such a delicate rhythm that not once did I fear for her future. How could I have been so wrong?”

Some blame consumerism gone mad and easy credit. Kristen’s parents blame themselves for not teaching her the value of money well enough. Yet they raised their son the same way and he manages to live debt free and frequently gives money to charity. They plan to pay off Kristen’s debt which she will have to pay back over time. They have drawn up an interest free contract. It will take Kristen three years to pay back the money. One of the conditions is that she cut up all her cards immediately. She says she feels sick to her stomach and can’t tell if it’s because her parents have found out about her debt or because she has to cut up her cards. “I don’t know how I’ll survive without buying things,” she says. “I’m embarrassed to admit it, it makes me sound like such a loser.”

Seems that a lot of people in Sydney can’t survive without buying things, but it’s not just plasma screen TVs and Playstation 3s that are contributing to household debt. Reports in the press on the weekend show that house prices have reached a zenith of unaffordability. Many people are now spending one million dollars on their first home. Maxed out is a phrase which describes the financial status of many Sydneysiders.

I am fearful of where it will all end. I worry that if interest rates continue to rise the economy may fall into recession, that people I know and love will lose their jobs and thousands of debt-servicing problems will be created. I am already seeing shades of the US sub-prime mortgage fiasco here, despite the assurances of economists and politicians that all is well. I worry about the dashing of hopes, homelessness, the loss of idealism, depression, suicide. I feel we may need a revolution of some kind to address these issues but see no heroes willing to storm the Bastille lurking in the shadows.

We all want different things but one of them is not disorder. We all try to plan our lives to avoid being driven by panic. But debt; crazy, over-inflated, monstrous debt is turning the tough into the vulnerable. And our policy-makers are letting us down by not addressing the issue head on.

For an insight into how household debt has affected many people in the US you must read Laurie Anne’s wonderful post over at All Over The Bored. I know she won’t mind me providing a link. You must read it. She is an extremely gifted writer. Cheers, Laurie!

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10 thoughts on “Money Too Tight To Mention.

  1. Laurie Ann is one of my FAVORITE bloggers / writers around.

    I have no idea how people get THAT far in debt. Over STUFF.

    I guess there really is a “shop-a-holic” type of person.

    My mother is sort of like that. Not quite to the extreme of Kritsen in this story, but my mother HAS TO buy SOMETHING every day.

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  2. Miss Britt – I fear that’s what’ll happen here. Initially there’ll be so much jubilation over cheaper rates that spending will increase but it will all be on credit. It’s madness!

    Meleah – I love Laurie Anne too. She is amazing. I have a friend who is a shopaholic. She does it to make herself feel better about the toxic relationship she has with her husband. She has closets full of stuff she’s never worn. It would actrually be cheaper if she left him, but she won’t, it’s a revenge thing. Hold on, I can feel another post coming on!

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  3. “Seems that a lot of people in Sydney can’t survive without buying things, but it’s not just plasma screen TVs and Playstation 3s that are contributing to household debt. Reports in the press on the weekend show that house prices have reached a zenith of unaffordability. Many people are now spending one million dollars on their first home.”

    These people aren’t buying plasma screens either:
    ”28 per cent of working poor households received incomes that were more than $200 below the poverty line, and 25 per cent had incomes of between $100 and $199 below the poverty line.”
    More than 3% classed as ‘working poor’
    http://news.ninemsn.com.au/article.aspx?id=61957

    I hope that Kristen gets some therapy or counseling because “$32,000 credit card debt” and “I don’t know how I’ll survive without buying things,” she says. “I’m embarrassed to admit it, it makes me sound like such a loser.” sound indicative of deeper issues – perhaps repressed emotions, or low self-esteem.

    “I feel we may need a revolution of some kind to address these issues but see no heroes willing to storm the Bastille lurking in the shadows.”

    Your post is a symbolic storming of the Bastille. It (your post) is a step towards a revolution of perception and may inspire the heroes we need.

    DavidM.

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  4. this is really turning into a fiasco isn’t it??? this total and complete obsession with overspending… i am forever thankful i have nothing and want nothing… i don’t know how i came to be blessed in my lack of desire,, but i can credit some of it with not allowing advertisements anywhere near me,, not on tv.. not in print… and never going to the mall… if i don’t know what they want to sell me…. how can i possibly want it?????

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  5. Every Sunday, my paper comes with a supplement crammed with ‘must have’ or ‘essential’ stuff … and most of it is expensive crap you’d never use. It’s all right iif the writer can afford such things, but does he ever give a thought to those who can’t?

    And, just about every other TV commercial I see offers either easy credit at a ridiculous figure or a debt-counselling service … there’s even one which claims to be able to write off most of your debt ‘using little-known Government legislation’. Small wonder that people are easily tempted.

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  6. Selma……that was so wonderful to mention me in your post and provide the link! I am so, so, so flattered. And to top it off, you said such nice things about my writing. You MADE my day, my week and my holiday. You are too kind!

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  7. Mel (sorry Selma, I’m addressing a fellow blogger on your site!) you are too kind. If you keep stuffing me with compliments…my head will swell bigger than Greg’s!

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  8. Paisley – it is a total fiasco. I worry what it means for the future of our society.

    Travelrat – the power of those advertising supplements shouldn’t be taken lightly. I can often feel them lulling me in with their bright, shiny goods and promise of a better lifestyle. The ads that I really object to, though, are the ‘no interest for two years’ offers. The fine print on those deals is scary. A few people I know have gotten in a lot of trouble with those.

    Laurie Anne – you are very welcome. I am a big fan of yours and your post addressed this issue much better than I ever could!

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