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This might actually be a good way to teach kids about credit and interest. Let them borrow a small amount at a high interest rate and walk them through paying it off.
It's one thing to tell them about financial responsibility. But watching a bad choice drain their piggy bank is the sort of trauma that leaves a scar.
Let's not scar children to teach them lessons. I'm sure there's a better way to teach a kid about interest besides getting a loan from McDonald's.
A couple dollars is a cheap price for such a valuable lesson.
But its just literally feeding McDonald's for no reason . Maybe the parents could rent money to kids in this way if you really wanna teach them that " lesson" for whatever reason .
Fine, do it at In-N-Out
I finally got to try In-N-Out last week and can finally say for certain that it's really nothing special. Might as well get a loan from Burger King.
It's a very decent burger at a very reasonable price.
It used to be better, and the family that own the company are far right Christian extremists.
The owners are Christian, but I think it's disingenuous to call them far-right or extremists. Compare their activities to Chick-Fil-A, for example; they're open Sunday and don't donate to hate groups.
I think this may not be a bad way to teach kids the dangers of compound interest, but only if you refund the excess interest afterwards because actually tricking your kid into draining their bank account in interest is a dick move.
Eh, valuable lessons generally are valuable because they cost you something to learn.
Anything that’s free we tend to not appreciate very much.
You could just ask easily be the bank yourself and save the "interest" for a birthday gift or something later on. This really isn't a difficult concept to use as a teaching opportunity without just screwing over a kid. Do you teach your kids to not walk into traffic by letting them get hit by a car too?
I mean, we're talking about borrowing 10 bucks for buying McDonald's here, I think they'll probably be able to recover from that just a little faster than they would from getting hit by a car.
That's why you let them think they lost a bunch of money for a few moments before giving it all back and telling them you love them, but that not everyone loves them in the same way and that real bankers won't be so kind.
As long as you make sure your kids know that you have their back and you'll support them through recovering from a setback like that, I think they'll be fine. Paying them back to erase all the pain of the loss might set an unrealistic expectation because at some point, you won't be there to bail them out anymore. Just don't add insult to injury by making fun of them or blaming them for their mistakes.
If that was the reason for it then great idea. Having to buy icecream on a payment plan is just sad and more than a little crazy
Oh I don't know if that was the reason for the one in the image. I agree with you that needing to finance ice cream is sad. I'm just thinking it could be a good intro to predatory finance for kids.
Why even use credit at all? What is wrong with debit?
I use my credit cards for everything I purchase because I get some cash back or other incentives along with fraud protections.
My brother’s a psychopath who plays his credit score like it’s a game so he has like ten cards and a 800+ score he’s proud of.
I make nearly three times as much as him and it took me forever to get an 800 so maybe he’s onto something but fuck that game.
I believe when you get serious about the tactics it’s called churning and manufactured spending
While you were at parties, I studied the FICO.
Under my tutalage, I have elevated my husband into the ranks of the >800.
I just use credit for everything and hover in the 820s. Unless there's some substantial discount for paying cash I just don't see the point these days.
That being said, my wonderful credit score ain't doing shit for me. It's not like I get some magical super low interest rate. Maybe when things calm down it'll be worth it, but then there will be some other reason not to borrow money.
There are some nice perks to good credit outside of interest. It can qualify you for better housing, better perks on certain rentals, not having to worry about emergency situations killing your savings outright, and let's you take advantage of stuff like cash back and bulk purchasing discounts. An example is staple foods, being able to hit the once-a-year bulk deals on stuff like rice or Lawreys garlic salt can cut the price of those items in half or better (personal examples, but the thought should hold). Ancillary perks, but they do add up.
"Credit Score" exists purely to sell you more credit score. It's only there because they were forced to let you see your own credit history, and they figured "why not monetise that somehow", so now you'll be bombarded with ads for more credit and loans, which boosts your "score" while giving them a sliver in affiliate fees.
Actual lenders will examine your credit history, and apply their own score. The criteria for a phone contract, am unsecured bank loan, a mortgage, etc, will all have wildly different requirements. I have one credit card that I pay off each month, and that was enough to get a house.
Paying what you owe reliably is all they're really looking for.
Credit cards come with fraud protection and help you build a credit score, which will get you a lower interest rate on a loan, if you need one. So long as you only spend money you have on hand, and pay off your card every month in full, there's no down side.
is this a universal thing or are you just assuming that the entire world works like the US? Here in sweden i have never heard of anyone actually using a credit card.
Yeah great point, the US has a very high emphasis on debt, for horrible reasons.
The debt industry makes so much god damned money for the companies involved in it, it's not even funny.
Between student loans and credit cards, US citizens have a collective $1.73 trillion in debt. And let's just assume 15% interest on average (probably a low-ball to be honest): that's $173 billion going to these companies in interest payments per year.
Shit won't change here because too many people with too much power are making too much money.
Hi!
I'm the Swede with a CC, right here :)
Now you've heard of someone using one (mwahahaha)
In all fairness, it's not exactly something people talk about - and for the record, I've never ended up paying any interest on the card. It's just convenient, offering a layer of protection for charges, makes it easier for me to track spendings, and allows me to be earning interest on my paycheck by keeping it in a savings account until I need to balance the CC.
Why even use debit at all? What is wrong with bank notes?
Why even use bank notes at all? What is wrong with precious metals?
Why even use precious metals at all? What is wrong with big stick?
It's for people who don't have enough in their bank account.
Although if you don't have $8, maybe rethink that shitty fast food.
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