It looks like Dora and I are about to buy an apartment. We’re very excited about this. We like the building, the location, and most of all, we like the apartment itself. We’ve made an offer, and if the loan goes through we’ll be living in a recently renovated building that was constructed in 1900. Our apartment would be a two bedroom on the second floor (In the US you’d call it the third floor) in very central part of town.
I’m excited to stop paying rent, which brings me to the subject of today’s post:
In a country full of financial paradox: where you must have a bank account in order to hold a job, yet the banks charge predatory fees; where the government recently raised taxes, but cut government services; where if you want to run a small business, you have to pay $500 in monthly fees, regardless of how much money you make – in a country like this, people have learned to view the exchange of money as an opportunity to “screw” or “be screwed.”
The result is that Hungarians avoid debt or borrowing of any kind, because it looks so much like an opportunity to be screwed.
For the most part:
Hungarians don’t rent apartments. They live with their parents until they can buy.
Hungarians don’t purchase anything in installments. They will drive their old beater until they have enough to buy a new car.
Hungarians don’t carry credit debt. Allowing yourself to be charged interest doesn’t make sense to a Hungarian.
Things are changing slowly. Home loans are picking up steam, and credit card offers are becoming more visible, but it is so different from the consumer driven culture I knew back in the States. That is: If you want it, you can have it now (strings attached).
Distrust is not always a good quality, but I can’t help but admire the Hungarian attitude of economic distrust. No matter the country, people do questionable things in the name of money; people in banking and government are no exception.
In
I never liked credit card debt, but it felt like the natural state of being in the States. Which makes me wonder about the whole consumer confidence rating. They make such a big deal out of that number, but if half of the people “spending” are simply going further into debt, then that’s not consumer confidence; it’s lender confidence.
I think maybe Americans could use a little of the Hungarian distrust. People in the States seem to believe that $25,000 of credit is a favor, but Hungarians would see that as a trap. Maybe the adolescent free-market economy over here has something to teach its more mature role-model over there.
2 comments:
good luck with getting the apartment bro!
my dad, you know him, the accountant, has spoken many times about the need to save and avoid "bad" debt. he does however understand the advantages of taking out loans to purchase things when the interest rate is low. i grew up a household where debt/income were never openly discussed. we always had enough money to go around though.
i've usually had a couple thousand in credit card debt, but since i've bought my house, that's gone away, and right now my house is my only debt. i changed my spending habits according, i feel good about that. of course i had it pretty easy in life, all of my college costs were taken care of by my parents/family, so it's not be a huge struggle financially to get to where i am today.
now i haven't accumulated massive savings, which is my next step. it's hard to imagine a time when i'll not be working and just living off some massive savings/investments. my parents seems to be thoroughly enjoying their retirement.
responsible spending is important. living within your means is important. living simply and not over consuming is important. imagination is still free, and recently i'm finding a lot more joy in the simple/free things in life, like going to the library and reading. people get caught up in life style obsessions, and end up unhappy and in debt.
Dear Hogan,
(1) Emelet really shouldn't be translated as floor - unfortunately English does not have an equivalent word for the concept of having raised a structure to a new level. Our thoughts are often hampered by our lack of words to express them.
(2) Your view of economics is naive and immature. I too once felt that way when I was a young and enthusiastic member of a student cooperative back in the 60's. Since then I have learned that "To each according to his needs" only works if you have a benevolent father figure who can be trusted to validate your wants and decide if they really are needs. Absent that, the law of supply and demand takes over and the rabble's demands for bread and circuses can only be calmed by an impartial system that screws everyone over equitably. I'm telling you this not because I am sharing the Eureka moment I never had, but because my conversion consisted of gradual turning points, sort of like course corrections, and was facilitated by input from many sources. If my thoughts are too radical for you - then you have not yet reached a course heading to which it can be applied. And that's OK too.
In either case, whether you understand my words, or not, I hope you will understand when I say "Peace and Love".
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