{"id":3353,"date":"2012-09-06T14:17:00","date_gmt":"2012-09-06T14:17:00","guid":{"rendered":"788CCE64-E021-4D5F-8E99-515FE55041BC"},"modified":"2013-05-22T16:46:57","modified_gmt":"2013-05-22T23:46:57","slug":"why-normal-isnt-working","status":"publish","type":"post","link":"https:\/\/www.boundless.org\/adulthood\/why-normal-isnt-working\/","title":{"rendered":"Why Normal Isn’t Working"},"content":{"rendered":"

The line in the coffee shop had just begun to thin out when Jake stumbled in from the cold. His black leather messenger bag hiding his brand new MacBook Pro and a fresh black Moleskine was slung over his left shoulder. He placed his order for his second Pumpkin Spice Latte tailored to his exact specifications of the day with the precision of a New York chef, while simultaneously checking his Tweets on his new iPhone. He popped out his credit card and swiped his way to caffeinated bliss. Jake is normal. <\/p>\n

Sarah had been running behind when she got the call that she was going to have to push it even harder if she wanted to make her deadline. The pace was relentless, and she was drowning. Between the long hours, blustering editor, paltry pay and hounding creditors, Sarah was hanging by a thread that had begun to seriously fray. With the deadline looming and time running out, she didn’t have time cook dinner. She rounded up menus from the usual culinary suspects and called in her order. It was Chinese take-out from the corner bistro for the fourth time this week. But you’ve got to eat, right? Sarah is normal. <\/p>\n

Bill and Molly are the life of the party. Always fashionably late in their shiny, new SUV, they always seem to show up looking like the latest \u201cit\u201d couple on the cover of Us Weekly<\/em>. They wow the crowd with their perfect smiles, well-timed jokes and their stories of weekends on the lake in their new boat they just financed to go in their driveway at their new house by the lake. Though they would never admit it, every couple in their circle would kill to be in their shoes. The dirty little secret is that Bill and Molly are most often about to kill one another in the midst of their financial situation. Bill and Molly are normal. <\/p>\n

Though they are from different walks of life, Jake, Sarah, and Bill and Molly all have plenty in common. They are bright, upwardly mobile, young adults stretching themselves to the max, living lives that they can\u2019t afford and charging themselves into oblivion on credit cards. <\/p>\n

Sadly, they are “normal.” <\/p>\n

The numbers tell us they are not alone. <\/p>\n

Consider these statistics from the United States Federal Reserve.<\/p>\n\n\n\n\n\n\n\n
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Total U.S. credit card debt<\/p>\n<\/td>\n

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$793.1 Billion<\/p>\n<\/td>\n<\/tr>\n

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Average credit card debt per household<\/p>\n<\/td>\n

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$15,799<\/p>\n<\/td>\n<\/tr>\n

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Percent of consumers that carried an unpaid balance in the past 12 months <\/p>\n<\/td>\n

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56%<\/p>\n<\/td>\n<\/tr>\n

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Percent who said their debt had gotten “higher” in the past 12 months<\/p>\n<\/td>\n

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26%<\/p>\n<\/td>\n<\/tr>\n

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Percent of disposable income that went to service credit card debt<\/p>\n<\/td>\n

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13.9%<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

These are staggering statistics. Frightening even. And the news gets worse before it gets better. <\/p>\n

In addition to these nightmarish numbers, let\u2019s add to the mix a huge, multi-billion dollar marketing machine that encourages the kind of behavior that produces those numbers in the first place. Throw in some peer pressure and the complexity of living in a culture that has lost nearly all of its self-control. Top it all off with the fact that living beyond one’s means is now considered, well … normal, and you have a good, old-fashioned recipe for disaster. As if the stress, drama and pressure of getting through each month financially isn’t enough, the “price” of this “normal” isn’t just one we pay today, but also well into the future as well. Consider this. <\/p>\n

Let\u2019s say you have a $1000 balance on your credit card that has an Annualized Percentage Rate (APR) of 18 percent. If you assume the minimum payment is calculated at 2.5 percent and break the 18 percent APR into 12 monthly installments, you end up with a 1.5 percent finance charge each month. Your first minimum payment will be $25. Seems pretty painless, right? Wrong. <\/p>\n

Since you pay 1.5 percent in interest each month, only $10 of your $25 went toward your balance, leaving your second month balance as $990. Since the same rule applies in your second month, once you sent in that check, you will have made $50 in payments and only reduced your balance by $19.90. Ouch. <\/p>\n

Now, here\u2019s the real kicker. <\/p>\n

If all of the features of the card remained unchanged (which is unlikely), and you only continued to make the minimum payments, it would take 153 months (that\u2019s almost 13 years!) to pay off that initial $1000 balance. And by the time you are finished, you will have paid $1115.41 in interest alone making your $1000 purchase actually cost you more than double what you paid for it \u2014 $2115.41. <\/p>\n

Again, we aren\u2019t just paying to be “normal” today. We are paying for it tomorrow and for years to come as well. <\/p>\n

The Why Behind the What<\/h5>\n

I would imagine that most all of us could agree that this precarious situation many of us find ourselves in is both unwise and untenable. But simply agreeing that there is a problem doesn’t solve it. If we want to see true and lasting change, we have to search for the “why behind the what.” We can accomplish this by asking the right kinds of questions. Questions like: <\/p>\n