Surge in indebted consumers

I'm seeing this a lot this year. Got good friends who just lost everything. Many parents at my kids school cannot pay full school fees (public school).

I guess the pursuit of bling has caught up to many people.
 
cbrunsdonza said:
I'm seeing this a lot this year. Got good friends who just lost everything. Many parents at my kids school cannot pay full school fees (public school).

I guess the pursuit of bling has caught up to many people.
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And inflation is running far in excess of what CPI claims.
 
Lots of jobs are also being shed and its hard to find new ones.
 
cbrunsdonza said:
I guess the pursuit of bling has caught up to many people.
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Yip, exactly. I know guys who are earning over R50k a month who are up to their eyeballs in debt because of the neverending quest to keep up with the Joneses.
 
cbrunsdonza said:
I guess the pursuit of bling has caught up to many people.
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True, inflation and the likes might have contributed but if one lives within their means they won't drown in debt. It's the pursuit of bling that is killing people
 
I would love to see more detailed stats on income and expenditure comparisons between now and 40 years go.

My uncle says he thinks that young people want the kind of lifestyle that their parents worked for ages to achieve. They want the fancy car and the fancy house right now, instead of starting small, and the end result is constant indebtedness and high interest payments.

I do think consumerism has risen drastically. I don't have any data to back this up, but it seems like everyone spends far more money on stuff. Computers, tablets, phones, cars, houses, furniture, renovations, clothes, etc etc. It's not just buying a fancy car, I think it is more than that. I'm not saying I am perfect, I do the same thing. It is hard to tread the line between financial sense and an enjoyable modern life. That being said, in my defense, I still drive a very old car, and dont have any debt besides my home loan.
 
Ancalagon said:
I would love to see more detailed stats on income and expenditure comparisons between now and 40 years go.

My uncle says he thinks that young people want the kind of lifestyle that their parents worked for ages to achieve. They want the fancy car and the fancy house right now, instead of starting small, and the end result is constant indebtedness and high interest payments.

I do think consumerism has risen drastically. I don't have any data to back this up, but it seems like everyone spends far more money on stuff. Computers, tablets, phones, cars, houses, furniture, renovations, clothes, etc etc. It's not just buying a fancy car, I think it is more than that. I'm not saying I am perfect, I do the same thing. It is hard to tread the line between financial sense and an enjoyable modern life. That being said, in my defense, I still drive a very old car, and dont have any debt besides my home loan.
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I agree with you. I personally have friends who I know earn roughly the same as my household, but when you look at the material things that they buy, I cannot imagine them affording it without making some serious debt. While they are buying a new car every 3 years, I am counting down the last few months I have left in paying mine off (They talk BS by saying that they have to buy a new one as the service plan is coming to an end and the car is depreciating in value - have you ever heard of anything this absurd). Add all of this up, together with a culture of not budgeting your money, and throw some E-Tolls and interest hikes into the mix and you end up with broken homes, and most of the time it's self inflicted.

My dad bought a new car for the first time when he was in his 50's, as there were other priorities. These days young people (even the seemingly intelligent ones) do everything upside down.
 
Ancalagon said:
I would love to see more detailed stats on income and expenditure comparisons between now and 40 years go.

My uncle says he thinks that young people want the kind of lifestyle that their parents worked for ages to achieve. They want the fancy car and the fancy house right now, instead of starting small, and the end result is constant indebtedness and high interest payments.

I do think consumerism has risen drastically. I don't have any data to back this up, but it seems like everyone spends far more money on stuff. Computers, tablets, phones, cars, houses, furniture, renovations, clothes, etc etc. It's not just buying a fancy car, I think it is more than that. I'm not saying I am perfect, I do the same thing. It is hard to tread the line between financial sense and an enjoyable modern life. That being said, in my defense, I still drive a very old car, and dont have any debt besides my home loan.
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Completely agree.

See it on a daily basis. I was 30 when I bought my first property, and made sure that it was affordable for me before I did so, it still hurt for a while but now its more than manageable. I have friends who are my age who live in places that are 2 or 3 times as expensive as mine, drive brand new cars etc etc, and they don't earn 2 or 3 times what i do, if anything some of them earn less.

I am working towards being debt free except for the homeloan, purely so that i can destroy the homeloan as quickly as possible. Then I can start working on building up a property portfolio.
 
I get pissed of everyday when I see similar people driving brand new gti's. im always asking myself how they manage to do it. what am I doing wrong?
 
deweyzeph said:
Anyone who borrows money to buy a brand new car needs to have their head read.
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As opposed to buying a piece of $hit for cash?

What is wrong with buying a new car within budget, over a short period (i.e. 3 years) with the intention to keep it for the next +10 years?
 
deweyzeph said:
Anyone who borrows money to buy a brand new car needs to have their head read.
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This. Borrowing the bank's money to spend on a fast-depreciating asset, yes yes that makes sense. :rolleyes:

It gets my tits in a twist when I see my mates who earn less than me getting into the wrong kind of debt (car, clothing accounts etc.) instead of the good kind (a homeloan).

The_MAC said:
As opposed to buying a piece of $hit for cash?

What is wrong with buying a new car within budget, over a short period (i.e. 3 years) with the intention to keep it for the next +10 years?
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Why not save up to 20% by buying a demo/second hand year old car with low mileage with the same intention? Is "that new car smell" worth 15 to 20% of the purchase price?
 
The_MAC said:
As opposed to buying a piece of $hit for cash?

What is wrong with buying a new car within budget, over a short period (i.e. 3 years) with the intention to keep it for the next +10 years?
Click to expand...

If you can afford it, and its not going to drown you in debt.. then nothing.
 
TehStranger said:
This. Borrowing the bank's money to spend on a fast-depreciating asset, yes yes that makes sense. :rolleyes:

It gets my tits in a twist when I see my mates who earn less than me getting into the wrong kind of debt (car, clothing accounts etc.) instead of the good kind (a homeloan).



Why not save up to 20% by buying a demo/second hand year old car with low mileage with the same intention? Is "that new car smell" worth 15 to 20% of the purchase price?
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Was watching America's got talent and these 2 women said that they will buy cars immediately if they win.Turned to my SO and laughed, yes, lets rather drive the black beemer and stay in a one bedroom flat :D
 
TehStranger said:
This. Borrowing the bank's money to spend on a fast-depreciating asset, yes yes that makes sense. :rolleyes:

It gets my tits in a twist when I see my mates who earn less than me getting into the wrong kind of debt (car, clothing accounts etc.) instead of the good kind (a homeloan).



Why not save up to 20% by buying a demo/second hand year old car with low mileage with the same intention? Is "that new car smell" worth 15 to 20% of the purchase price?
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I get your point. But in my case, all the demos were not that much cheaper and I was able to get a really good deal on a brand new car. It depends on the situation. But yes, I agree, if you can avoid the loan than do so.

I think the real problem is the whole "get a brand new BMW 3 Series for just R4999", with residual etc. Thats when things begin to get messy.
 
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