Advantages or Disadvantages of Debt

Credit cards have become increasingly popular world-wide, making it easier to buy now and pay later but are they actually helping or hindering someone’s credit? “Maxed Out” by James D. Scurlock demonstrates how credit cards can hurt someone’s credit, while “Why Won’t Anyone give Me a Credit Card” by Kevin O’Donnell demonstrates how someone may have financial stability to pay off a credit card, but still be consistently denied one by the credit card companies. Owning credit cards is not the problem; the problem is being irresponsible with it.

It is believed that about 6% of Americans have a shopping addiction; of the 6% 90% are women. To a shopping addict trips to the mall become the main way to cope with stress, even when it is having a negative impact on the rest of their life. The addiction will affect their relationships and finances. (Omniomania: Shopping Addiction, 2010) It is a never ending merry-go-round; the stress from relationships and finances just reinforces the urge to shop more in order to feel better.

On the end of the Democratic Party, both Hillary Clinton and Bernie Sanders presented comprehensive plans to help eliminate student debt, although they vary on how to deal with the cost of education and how much the government should pay (Josuweit, 2016). Clinton created the “New College Compact,” to address both the current and future educational costs, her main focus on addressing existing debt and allowing borrowers to refinance student loans at the rates allowed to students taking out new loans, which Clinton claims would provide to relief to twenty five million borrowers (Josuweit, 2016). In addition to this, Clinton wants to reduce interest rates on new student loans which would facilitate enrollment in IDR plans (Josuweit, 2016). On future tuition, Clinton claimed she would provide help so that students never have to borrow to pay for tuition and other fees attending a four year public college in state (Josuweit, 2016).

From the moment they become old enough to be aware that money is limited, young people today are taught to avoid getting into debt. Horror stories of payment defaults, exorbitant interest rates, and ruined credit are passed from generation to generation, and along with it, sentiments of disgust and panic toward the large and seemingly never-decreasing number that is the national debt of the United States of America. Yet, it cannot be said that all debt is bad; student loans taken as an investment in the future, or a mortgage on a house -- there are plenty of examples of how deficit spending can be a valuable practice, and the first Secretary of the Treasury was a strong proponent of that view when it came to government spending.

Did you know that the National debt is 19.8 trillion dollars? The national budget is excessive, which means the government is using more money than it needs to pay its costs. Do to intensive research in the national debt today you will be reading about what caused it, ways to get rid of it, and reasons why we have to care about the National debt.

Student loan debt can be an overwhelming thing to face when you first graduate from school. You have spent the previous three to seven years or all the more focusing on your future attempts and now wind up toward the finish of your scholarly street with a heap of obligation and searching for a vocation.

If the federal government ceased to exist tomorrow then at first it would be chaos. Nobody would know if the American debt would be honored and if so then by whom (who would want to take on 17 trillion dollars in debt?). Also federally funded social services (Medicare, Medicaid, Social Security, etc.) would stop because without any federal taxes there would be no way for people to pay for them. Also the three million people employed by the federal government would be put out of work, along with the roughly two million people in the armed services, unemployment on that scale would severely affect the American economy. In the mid-game scenario banks and other corporations would step in to take power because they are already in position to

“College is part of the American Dream, it shouldn’t be a part of a financial nightmare for families” - Barbara Mikulski, United States Senator. Student debt is a rising issue in America; 43.3 million students are in debt at this moment, and this number increases every year. In other developed countries, education is free or low cost and works well economically. Countries like Germany, Sweden, Australia, Denmark, and France have extremely affordable college tuition, so what do these countries do to make education so affordable? What do American politicians and citizens find wrong with free or lower cost college education? How should America go about solving this issue and follow other countries footsteps? Just how bad is America’s student debt

In this article the main topic is that the official total for the United States federal debt stands at $13.6 trillion. But this is only a small portion of the nation’s debt—the true figures are beyond stunning. According to the article these are “unfunded liabilities,” which in government terms refers to any program or expense that requires it to pay, but either does not bring in any money or enough to cover expenses. In the example of Medicare, the unfunded liability is the difference between the benefits promised to current and future recipients and what will be collected in taxes and Medicare premiums. Moreover, this article states that the financial problems

Anna Quindlen, a novelist, social critic, and journalist wrote an intriguing essay “Stuff is Not Salvation” about the addiction of Americans, who splurge on materialistic items that have no real meaning. The ability to obtain credit is one of the main reasons to blame for society’s consumption epidemic. However, Quindlen feels the economic decline due to credit card debt is insignificant compared to the underlying issues of American’s binging problems. Quindlen’s essay gives excellent points regarding the differences in America’s typical shopping habits. Additionally, she mentions how people acquire all this “stuff” but seem to never realize, “why did I get this?”(501). Quindlen makes her

“The average American owns 3.5 credit cards and $15,799 in credit card debt… totaling consumer debt of $2.43 trillion in the USA alone.” (Beckner). Debt forces many people into depression and worrying lives. People struggle to discover happiness through financing goods, but struggle even more to find a way out of debt. Through consumerism, people lose their finances in department stores, car dealerships, and much more. Most of the possessions people buy with credit cards become impractical within a few months. The void they search for is never really filled. Consumerism is just a way to get the economy going, without thinking of a person’s individual finance

Both cash and credit cards are similar in that they both are easy to carry around, and are used to pay for goods and service at the time of purchase. When making a purchase using cash, the items are paid for in full. Cash is acknowledged in every establishment such as department stores, food chains, grocery stories, as well as schools, and more. Moreover, using your money to pay monthly bills carries substantial benefits such as increasing your credit rating. When purchasing items with a credit card or cash, it permits you to pay for all your items in full. Equally, most credit cards are also widely accepted at various restaurants, universities, clothing stores, movie

Sources of finance refers to the ways of gathering various financial sources to meet the financial needs of the business. Furthermore, it states exactly how the companies are gathering and allocating finance to satisfy the requirements of the firm (Chandra, 2011). Firm either belong to existing or new categories that would need a varied amount of finance to meet the long and short term requirements such as construction, inventory, fixed assets and operating expenses (Hally, 2007).

Bank credit cards have short-term benefits to consumers. They are a convenient way for consumers to be able to purchase items, pay bills, go on vacations, etc., without having the necessary funding for those things at the time of the transactions. The credit cards also benefit the banks that profit form the interest and late fees that consumers have to pay. In the long-term, consumers often find themselves in sever debt due to unmanageable spending habits. Thus, creating situations where very few banks and consumers profit from the use of the credit cards. So for some it has long-term benefits but for many others there is not.

As far as credit cards are concerned three good reasons for obtaining one are; they aid you in establishing your credit score as well as history. Credit cards are also great if there is an emergency that requires immediate financial action and assistance. Lastly, credit cards offer many benefits such as cash back, rewards, and discounts. The negative effects of credit cards is that they often come with high fees and interest rates. One other negative drawback to obtaining a credit card is that individuals can get themselves into