Tuesday, August 23, 2011
Bad Financial Advice: Just Default
I believe I once started a feature on "Bad Financial Advice." I don't know if this is a revival, but a thread on imamother about getting out of credit card debt bring me back to the theme. A poster advises someone seeking advice on her credit card debt to default on the payments. She claims it isn't so bad and, in this economic environment, you can even get credit again. Yippee. In this case, the mother looking for advise has $4000 of credit card debt, perfectly surmountable.
Ruining your credit isn't just a matter of getting credit and the dollars and cents of interest rates. Bad credit hurt those seeking employment opportunities. It can cost you a security clearance. It can even cost you your current job. (link)
Bottom line: employers use credit history as an indicator regarding responsibility, character, and trust. Bad credit is a risk factor, especially if you are dealing with money. Best to deal with the $4000 than seek an "easy" way out. That easy way out may cost you much more in the unforeseen future.