When I was in college I had taken out a credit card like most teens my age in order to build credit. With books and expenses I had quickly maxed out my cards $2,000 limit. When I started getting bills I was promptly putting payments on the card like I was supposed to. I got a refund check for about $2200 and instead of putting it on my card and paying it off, my friends convinced me to spend the money on various gadgets and toys, so I did. Unfortunately I started struggling after that and could no longer make the payments on the card, so it went into default 🙁 I eventually was able to pay it off, but not till after the damage to my credit was done.
– Submitted by: Rodney
I hear stories like this a lot where someone spends large refunds on frivolities instead of using the money for their needs. It’s an unfortunate mindset that American’s are brought up in where we think when we have a chunk of money we can finally buy the things we’ve always wanted and ignore the debts and needs that the money should be put towards instead.
Even with new gadgets and toys, you are still in debt. You don’t have the luxury of gadgets and toys when you owe money, because once that stream of income stops or becomes compromised, you now no longer have money for anything and still have debt that you are required to pay.
Amount Flushed Down the Money Drain: $2000