Posted May. 18, 2005 23:15,
Mr. Benjamin Franklin Beggit, 38, was first issued a credit card when he was on his honeymoon in 1990. He earned only $11 per hour working as a hotel concierge, but bought clothes for his wife and himself with his credit card.
In 1996, he moved to a town where doctors, lawyers, and professors lived. He bought items such as furniture and carpet with his credit card in order to match the living standards of his neighborhood. His income increased to $13 per hour. However, his credit card debt increased much faster.
He paid back his credit card debt by extending loans secured with his house twice, but the debt increased again. In 2003, with debts amounting to $30,000 (30 million won), Beggit finally filed a petition for bankruptcy. He divorced after a 13-year marriage and sold his house.
Benjamin Franklin, a founder of the United States, used to say, Sleep without eating dinner rather than awake amid debts. However, Beggit lived conversely. The Wall Street Journal reported on May 17 that more Americans depend on their credit card debt to match the living standards of their neighborhood.
The income of U.S. households, which belong to the mid-level income bracket, increased by 11 percent from 1990 to 2004. But their expenditure increased sharply by 30 percent. How did they get the money to support this? The answer is with an 80 percent hike in their debts. In 2004, U.S. household debt exceeded $10 trillion, two-fold compared to that of 1992.
In 2003, the average debts of the U.S. households with more than one credit card stood at $9,205, an increase of 23 percent compared to that of five years ago. The income gap between upper-level and mid-level household income groups widened during the 1992-2004 period, but the expenditure gap between the two groups was not that large. This means that the mid-level income group lived on debt.
Spending for Showing Off-
The mid-level income group used their credit cards to buy houses, cars, and furniture. Mr. Winfort Waynman, 30, bought four pickup trucks by increasing his debt despite working for his brothers company. The reason was that he was unable to resist buying smart trucks.
Recently, a newspaper from Utah commented that Americans, who are on a crusade for shopping, jump into the jungles of greed by flourishing their credit cards like knives.