Words: 656
We live in a world of opulence and extra. The tantalizing promises of “new” and “better” are hard ones to resist. Our surroundings constantly urge us to covet what we cannot have, and there is a savior. Credit cards and rent-to-own shops allow us to live a life we could only dream of years ago, but the unforeseen aftermath is far worse than we could ever imagine. Once you have fallen prey to credit’s siren call, its oppressive grip is a hard one to break free from.
Let’s look at a promising young couple, both fresh out of college, and past the celebration of marriage. They both decide it is time to start a family, and the young woman becomes pregnant. Flash forward eight and one half months, and the couple realizes they do not have enough money for the last minute necessities before the baby’s arrival. They decide to apply for a five thousand dollar limit credit card with an attractive introductory rate of zero percent, (for the first three months).
Once approved, the couple immediately charges to the limit imposed on the card, and both breathe a sigh of relief now that everything is taken care of. But our story does not end there. What the couple does not realize is that directly after the baby is born, the cost of care exceeds their original expectations. They are forced to pay just the minimum monthly payments on the credit card. In three months time, the nonexistent credit card interest soars to twenty nine point two percent, and is applied to the remaining balance.
Now, if they continue to pay just the minimum monthly payment, their new child will have gone through elementary, junior, and senior high school, a four year college, and might even have a family of his or her own before the debt is ever paid off. By that time, they more than likely have amassed even more debt, because once they are ensnared in a credit card’s vicious cycle, other credit companies will bombard them with offers and propaganda to use their credit cards, showcasing even more enticing deals. Rent-to-own stores are another way Americans can get what they want now.
Let’s take our same couple and show their lives right after marriage. They rent a meager starter row home in a quiet neighborhood. Unfortunately, between the two of them they do not own enough furnishings to make their new home appear lived in and feel comfortable. The local rent-to-own store is offering a special, “NO MONEY DOWN, NO PAYMENTS FOR THREE YEARS”! They decide to go directly to the store, and spy a wonderful five piece living room set with television, and the payments are a low $14. 96 per week. Eagerly, they sign a contract.
What they don’t realize is that because they signed the 3 year deal, interest is accruing the entire time they hold off on their payments. This interest will then be added to the end of their payment plan. In addition, the low payments, (when the total cost is factored), turn out to be an incredibly large sum of money. On average, five times more expensive than if they had purchased new, and these were used items. Also, rent-to-owns are notorious for their debt collection practices, contacting customers three to four times daily over past due accounts as little as two dollars.
These companies know people want what they cannot have, and exploit those feelings with attractive sales pitches and iron clad smiles. Credit offers people the reality of living above their means, and takes full advantage of the eagerness and gullibility of these wants. By allowing unchecked freedom to spend, most are imprisoned in a never-ending web of debt and despair. Americans should adopt an attitude of need, instead of one of want, so that we may enjoy life without the burden of existential consumerism.