Spends money on cigarettes but complains she can’t make ends meet
Bought luxury furniture she couldn’t afford, then;
Bought even more luxury items (smartphone, fancy speakers)
and now
Facepalm - can’t make the payments on the luxury items she rented.
However, by the tone of the article, she’s somehow a poor downtrodden “victim” of that evil rent-to-own store. There is not one whiff of a hint that perhaps this woman’s problems are a direct result of her own need for instant gratification and failure to educate herself about basic financial management skills. Screw you, Washington Post, you just made my head asplode.
And there’s always someone, like the rent-to-own stores described in the story, or payday lenders, who will take advantage of poor people and charge them brutal, usurious interest rates that are guaranteed to plunge the poor even further into poverty.
So sure, let’s all point at the poor who made a stupid, uninformed decision, and ignore the role of the bloodsuckers who take advantage of them.
She certainly made some bad choices, and there are reasonable arguments to be made about issues of personal responsibility and budget management, but your OP does no justice to the complexity of this issue, and to the broader point made in the article about the hurdles faced by the poor in buying what are, in many cases, basic household goods.
And it’s not “luxury furniture.” That is, in fact, part of the point of the article, As a poor person, she found herself in a position where one of her few options was to pay luxury prices for relatively shitty goods. Not only is she faced with items that cost far more that what you or i would pay, but he cost is then increased dramatically by the payment system.
ProPublica did a piece recently on a company called USA Discounters, which markets itself to the those on low incomes, and especially folks in the military. It’s not a rent-to-own place; you actually buy the goods on credit, but the system is similar in that you pay vastly inflated prices topped by usurious interest rates.
I’m not sure what the solution is to stuff like this. My first reaction would be to reintroduce or strengthen (depending on the state) usury laws, and to apply them also to rent-to-own type places. I understand, though, that stuff like this flies in the face of many Americans’ strongly-held beliefs about personal responsibility and individual freedom of choice. At the very least, i’d advocate some sort of financial literacy campaign, to make people understand the consequences of signing up for ongoing payments, and explaining more clearly to them the overall cost of the item and the burden the payments will put on them.
I guess this is, for the most part, a matter of principle where folks on either side might not ever convince one another. While i understand the personal responsibility argument, to be honest i find it pretty contemptible when aimed, especially with the vitriol of the OP, at poor and uneducated people who earn less than the rest of us, yet who end up paying many times what we would pay for basic goods that are often of inferior quality. I might find myself shaking my head at some of the choices made by these folks, but my next thought is generally, “How might we stop this from happening?” rather than “Ha ha! Look at the dumb, fat, poor people and the stupid things they do!”
Also, glorifying? That’s not what that word means.
I understand that you might be the sort of very modern Ayn-Randian conservative tool who thinks poor people are to be scorned, mocked, and trodden upon, and who becomes apoplectic any time someone suggests that exploiting people who are not well educated is a bad thing. But that’s different from glorification.
I agree. These assholes should do background checks on everyone to make sure they don’t do business with the poor and stupid so they don’t make their lives worse. Oh, wait but then you would call them racist for discriminating against the poor minorties.
We are a country that spends beyond its means. The only difference between this lady and most of America is that she bought furniture instead of a house that’s too big. You’d be right to say we shouldn’t condone either, but let’s make sure your critique is squarely pointed at the average American.
The other thing is that this notion of consumer items as luxuries is really outdated. The real luxuries in modern America are post-secondary education (and decent primary and secondary schooling), healthcare including health education from a young age, child care, and job opportunities. That’s what poor people really can’t afford or finance. It sounds like this lady could have benefited from a few more of those real luxuries.
I’m sympathetic towards actual necessities. Sofa’s are a luxury item. Sit on the ground if you can’t afford to pay for a sofa. iPad? If that’s a necessity then we are in bizzaro world.
If your entire business model is based on squeezing as much money as possible from those who don’t know any better, your business is unethical, even if the people you squeeze the money from should know better.
This article seems to me to be written with a skew against the furniture store. I think they may have picked a bad example if the point of the article was to display these types of stores in a bad light. I’m with some other posters here - loveseat? smartphone? cigarettes? These are not luxuries or even Must-Haves.
While I might sympathize to an extent with someone trying to understand a 25 page mortgage document, I don’t know how you can say these people didn’t know any better. Are you saying they don’t know how to multiply 2 numbers to see what their total payment would be?
And looking at it from the other side, what SHOULD stores like this be doing? Not offering anything to people with less money? Lower interest rates? If interest rates are based on risk, how should they determine what people SHOULD be paying?
$4158 over 2 years paid weekly is $39.98/week. Put $40/wk in the bank, you have your sofa and love seat in 9 months. If you can’t make a payment to yourself because something came up, so what, you are just delaying your purchase. if you can’t make a payment to them, you are screwed, you lose the furniture and all of the money that you have sunk into it.
The main reason interest rates are so high on these types of loans is because the borrowers tend to be extremely bad credit risks. And the main reason they’re such bad credit risks is because they’re not responsible budgeters and spenders, which is frequently the reason they’re so low-income to begin with.
If you outlaw “usurious” interest rates, you are not going to have these lenders (or other lenders) charging lower rates. You just won’t get these types of loans altogether.
I’ve not read the article so I can’t comment about this specific instance. But in general, I disagree with the notion that someone offering goods or services that someone else wants has a responsibility to ensure that it’s in the buyer’s best interest to purchase it, unless it’s something so complex that the buyer likely doesn’t understand it, in which case they should try to ensure that they do.
I read that article, and found myself getting angry with the rent-to-own place until a bit further along when the $1500 sofa and subsequent additional purchases were described. I’m a well-compensated IT professional in the middle of my career, and I spent several months agonizing over a similar purchase, even without an additional $3000 in finance charges. Ultimately, while the article did point out how expensive it can be to be poor, the family chosen to exemplify this made multiple, truly idiotic choices.
Oh, bullshit. Usury laws have nothing to do with preventing anyone from doing business with the poor and stupid (or the poor and not-stupid, of whom there are many), and everything to do with predatory lending practices.
And nobody brought race into this but you. The people discussed in the story don’t appear to me to be members of any minority group other than the desperately poor.
Screwing people, especially poor people, of their money is flat-out wrong. It’s not right to do something just because you can.
How were these people “screwed” out of their money? They simply had to multiply their monthly or weekly payment by how many payments they needed to make and then determine if they wanted to do that. Are you saying they are so dumb as to not be able to figure out their total cost? Or the store forced them to purchase a $1500 sofa?
Yes. Lots of people are that bad at math. Not necessarily at the task of multiplying two numbers, which they can do on a calculator, but understanding that multiplying those particular numbers gives you the total cost.
Yes, if the risk is that high it means your business model consists of “helping” your customers in the short term by screwing them over big time in the long term. Their business is bad, and they should feel bad.