On Borrowing Money

And you MUST check out this site:-
https://www.wonga.com/

Category:

People & Blogs

Tags:

• money
• debt
• APR
• interest
• credit
• cards
• bankruptcy
• loan
• sharks

[krysylys]

Sage advice Tenneral, as always.

"Neither a lender nor a borrower be..." :)

Wisdom, self-discipline and consistency is required in order to know when this rule can be broken.

However, I found it an amusing co-incidence you also pointed out Wonga as a company that charges an outrageous APR.

They actually charge 20.69%. The rate in the advert is a typo.

But that is irrelevant: that's still pretty steep.

I worry though that the debt ridden will be "Robbing Peter to Pay Paul" in greater numbers...

[tenneral]

@krysylys Far be it from me to say you may be mistaken but I have just looked again at the Wonga site and clicked on their APR number [2689 %] where it says "Please Explain".

There it says "Yep, we know it's huge." And it gives some helpful formulae to prove how reasonable they are! Check it again yourself and see if you agree with me.

[DeeDemonwitch]

what really gets me about these consolidate your debts adverts is when they say 'pay off your debts and have enough left over to buy a car or a holiday'! NO, if you already have debts and you borrow money to pay your debts, you DO NOT have money 'left over' to treat yourself!

[neil73]

They say if you lend £20 to someone and never hear of them again, it was probably worth the £20.

The worst thing about borrowing money is that it has to be paid back, and those that are out on shopping sprees, not worrying about the morrow suffer the most

[panchohelga]

HAHAHAA, WOOOOWWWWWW. 2k+ rate? i can see savagery building up. my dad took out a loan for $7k and will have to pay back $14k, jesus

[ProfMTH]

A 2000% APR?! That's a Mafia rate. Wow. Bring back the usury laws.

I've been one of those not so strong minded people with a penchant for running up debt, but as I've arrived at middle age I've gotten better about it. You're absolutely right though: when I was younger than 30, I didn't believe any of it was a problem.

[colourmegone]

I have both a debit and a credit card. I use the credit card, which I pay off every month, exclusively for buying on the internet. If you use a debit card you have no recourse for shoddy goods and no protection whatsoever against outright fraud. PayPal will only return half your money and only then if the goods aren't delivered, that is if you receive ANYTHING it's not their reponsibility, it's a dispute between you and the vendor and good luck to you!

[OccamsView]

sage advice.

[SeventhCycle]

I tend to think that using a credit card should primarily be for when the object is:

a) Worth getting now instead of later.

b) The potential interest involved in purchasing the item now is worth it.

Most people don't seem to look at it that way, and end up being maxed out because of it.

[RustyTube]

@NikiDaDude Look, kid, you are getting really annoying when you preach things you know nothing about. Maybe in Bulgaria you have a free market, but in the West the market is regulated. In England Henry VIII was the first to regulate usury.

That is why I asked *Michael* if that was legal in the UK. I did not ask *you,* so get out of my hair.

If you want to state your point, post a comment on the video itself instead of flooding my mailbox.

[MikeOfKorea]

My Visa and MC come due on the 25th of each month and must be paid in full. That is just fine by me. Keeps me out of trouble!

[randyscorner]

As always I find your videos both entertaining and enlightening. Nice work.

[kalsolarUK]

Good advice! Credit cards can be a useful, though often only temorarily so. I have both debit and credit card, but I have the credit card set-up so that the money I owe gets taken out automatically each month so I don't have any interest to pay.

[NikiDaDude]

@RustyTube I was illustrating my point why the APR might seem high. If service fees are added when the APR is calculated it will raise the number a lot, especially for smaller loans. Borrowing 1000$ for a week from the mentioned bank would mean a debt of 1517$, if someone finds this acceptable then there will be someone offering it, thats the free market.