Wednesday, June 27, 2007

Minting money off poverty

This is the name of a heart-wrenching article over on MSN Money. Check it out here.

It's basically a bunch of stories of people who, once down on their luck, had only credit-card companies to turn to for help in getting through the day. It's extremely sad because these people come off as having no other choice but to go into debt to keep living day to day.

I should also note hear that, even though I haven't reviewed it, the topic of personal debt and how credit-card companies do their business should watch Max'd Out, a documentary about debt and how people get fucked over once they start in on that slippery slope without understanding the terms.

One thing I did notice about the stories in the article is that most of these people had a strike against them before debt started to screw them over. Most of them already had several children from a very young age. They were already on the brink, and then debt simply nudged them over the edge.

Cliche as it may be, this all goes back to education and the lack of it at the school level. Kids should be warned and protected from this kind of stuff, especially low-income kids. They simply won't be able to afford making mistakes like these. In college, I had a bunch of friends that probably went into credit-card debt and once they figured out how deep they were, probably just got scolded from their parents, who promptly paid it off, and then kept right on living. No sweat. That's how they learn about credit.

But if you don't have the money to learn the hard way, you enter into indentured servitude and wind up working the rest of your life to pay back all the interest and late charges. It's crazy.

One thing you have to listen to about Robert Kiyosaki is his point on educating young people in schools about financial matters. Why doesn't it happen?

As you read the article you'll realize that education in a more general sense is what's missing here.

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