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Living with credit

Emily’s list: Living large edition

Emily Crone

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Ah, credit: The beautiful thing that allows us to spend money we don’t have. While it is a fantastic tool in the face of emergencies, it’s one of the major causes of the economic meltdown. Many people didn’t view credit as a loan with growing interest; they saw it as free money or a way to spend above their means. That mindset seems to be diminishing, but living too large is still a major issue in America. In this week’s roundup from the personal finance blogosphere, we explore the issue of buying things on credit when perhaps you shouldn’t.

1. Mrs. Micah discusses how she feels about the Bag, Borrow or Steal Concept. Glorified by the “Sex and the City” movie, it’s similar to Netflix in that it allows people to rent expensive items such as jewelry and handbags and return them later. It’s a great way for shopaholics to avoid going into major debt, but it still costs money. Is it wise to give off the impression that you have more moolah than you really do?  Plus, if you ruin the rented item, you’re really in for some debt.

2. You can borrow goods you can’t afford, but getting all that stuff and showing it off isn’t everything. Free Money Finance discusses a recent study that found experiences make people happier than possessions. Take that, Samantha, Charlotte and Miranda.

3. Kacie at Sense to Save explains why she thinks mortgage holders who got in over their heads shouldn’t be bailed out, and why people who can afford to continue to make payments need to do so.

4. What if you can’t be bailed out? The Consumerist discusses the option of walking away from a mortgage that you can’t afford and what the fallout entails.

5. Philip at Wise Bread says it’s better to do without than spend what you don’t have, but if you can’t, there are other options — borrow, rent or substitute.

6. Trent at The Simple Dollar wanted to buy a used car that he could pay off in cash, but he ended up buying a new car and financing. Read this controversial post in which he explains his decision (be sure to read the hundreds of comments, too).

7. Living Almost Large says the recession is a time of great opportunity for those under 30 because they can buy affordable stocks and homes. He has trouble feeling good about it though when there are layoffs abound. Should we be reaping the rewards of the recession while others are struggling?

8. Frugal Dad remembers when he and his wife had their first child at a young age. They overspent and went into debt just to have a nice SUV and to keep up with other parents who had more money. He explains what he would have done differently. Remember: Your kids won’t remember if it’s Gucci or Osh Kosh B’Gosh.

9. Bargaineering provides credit card tips for college students, which is a crowd vulnerable to misuse. Some key advice is to pay with credit only if you have the cash to pay it off with, and don’t use plastic if you find yourself struggling to keep up.

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  • Here’s a way to save money: Turn off your lights on Saturday night for Earth Hour. You’ll save the earth AND your hard earned cash.

  • Thanks for writing a thorough article about personal finance management. I learnt something new and hope to test drive your ideas soon. Awesome article!!