I was listening to this link at NPR where a behavioral economist points out how we make irrational money decisions simply out of habit. He points to people who are trying to get rid of their SUVs and taking a hit of many thousands of dollars to save probably at most $1000 extra a year compared to what they paid the year before for gas.
Price Of Gas Gets Attention As A Painful Habit
He says the reason for that is that our habits make some purchases more painful than others. Buying gas is particularly painful because we have to sit and watch the meter as it rings up our purchase. Well, he might have a point. I don’t own a gas guzzler, but I wonder sometimes how these banks are going to stay afloat when people start defaulting on their car loans. Think about it. If I had a gas guzzler and I could go out and buy a junk heap for a few thousand and just not drive the car, what incentive would there be to pay the car payment? They can come and take the car, right? Repossession would be an attractive option for these people even if their credit gets hit. Better to get a car that gets you to work and back without bankrupting you than to pay for one that does bankrupt you in the end. You can always worry about the credit later. So, would that be considered irrational or just practical?
Student Loan Exit Interview Asks You To Leave The Country
So, today they made me fill out my student loan exit interview even though I’m not done with the courses. They say since I am taking a leave of absence, I have to do it. And, as I’m filling this out, they make you take a short quiz at the end of each section. One question asks “If you can’t pay your loan, what do you do?” And in the multiple choice option it has as a choice: “Move to another country.” Ha, ha, ha! I’m thinking: Are they trying to give people ideas?
Irrational Behavior Or Impossible Choices?
This year has been horrible for my finances. I made a decision to pay my mortgage late this month deliberately. Not 30 days late, but late enough that I have to pay a late fee. Will it show up on my credit report? I don’t know. I generally have an excellent credit score, but this year has been so rough that I’m amazed I hung on this long without being late. But, my choices were to pay other debt that would have cost me far more in the long-run or to pay the mortgage with a set late fee. At that point, your credit is going to take a ding anyways, so it doesn’t matter, you’re just trying to keep things from snowballing. But, all my research said it had to be 30 days late to be sent to the Credit Bureau. We’ll see… Maybe it was one of those irrational decisions this guy is talking about! The rules in the U.S. are so difficult and complex these days for loans, that you are literally walking a minefield when you come up short in any month.
Maybe moving to Mexico is not such a bad idea!