barbhendee

This morning, as I often do, I was reading the news on MSNBC, and I got caught up in an article about a 43-year-old woman who had $62,000 in credit card debt. Yikes.

She is renting an apartment and driving an older car . . . as she can not afford a payment on a newer car because most of her salary goes to make the minimum payments on the credit cards. This did not happen to her overnight, but over a number of years. She says she has nothing to show for this mountain of debt.

To make matters worse, several of the cards with large balances have over a 20% interest rate.

I think it is easy to shake our heads and say, "Foolish person."

But there is a part of me that can truly understand how someone could easily fall into serious credit card debt. Back in the late 1990s, J.C. and I were on our way. Banks were throwing credit cards at us, and in the beginning, we were not too savvy about interest rates.

At one point, we had three credit cards. We started out owing "just a little." Then we bought a new couch. Then there was an emergency family trip where we had to buy expensive plane tickets, a few large vet bills for one of our cats, and some pricy car repairs we could not pay out of pocket. We ate some meals out and charged them. We took one trip for fun. We charged a few Christmases . . . .

Blah, blah, blah . . .

We were just making the monthly "minimum payments," and then one day, I sat down and added up what we owed and how much of our money was going to interest. I talked to J.C., and we did a 180, and thankfully, we got on top of this before it was too late.

Now, we never run a balance on our Visa. We do use our card for things like plane tickets, hotels, and online purchases. I think a credit card is necessary, but we always pay the balances.

But I truly can understand how easy it was for the woman above to fall into "interest" slavery, and I feel bad for her.

Every time J.C. and I try to make a purchase at a place like Target or Cost Plus World Market, we always have to do the same dance where the check-out person starts pushing the store's credit card.

"You'll save ten percent on today's purchase. It's foolish not to take advantage."

As nice as I am, I've stopped being pleasant to these folks if they ignore my first polite, "No, thank you." If they keep pushing, I look them in the eye and ask, "What's the interest rate?"

So far, not a single clerk has had a clue. I do believe they probably do not know. So I tell them. “The average interest rate on an ‘in-store’ credit card is 22%.”

Just say no.