The iPhone Debt Crisis - Should You Finance Your Cell Phone

TL;DR

A study reveals that 28 million Americans are willing to go into debt to buy the new iPhone, highlighting the financial risks of financing expensive liabilities.

Transcript

what's up everybody I am dust but it's Inge and welcome to the minority mindset today I want to talk about something I learned recently so as you may or may not know on September 12th 2018 Apple will be releasing than you iPhones now I'm very excited for this because I am an Apple user as you can tell by my computer and I am ready to get a new iPho... Read More

Key Insights

• 🙃 The anticipation of owning the latest iPhone leads many to overlook the financial risks associated with financing expensive liabilities.
• 🍉 The study's findings illustrate a concerning trend of consumers prioritizing instant gratification over long-term financial stability.
• 🤑 Financing items one cannot afford with borrowed money is the main reason for many people's struggles with debt and an inability to build wealth.
• 💳 Consumer debt in the United States has reached record levels, with credit card, automobile, student, and mortgage debt all contributing to a financial crisis.
• 👶 The average American household carries significant debt burdens, making it unwise to add more debt by financing a new iPhone.
• 🙃 Owning an iPhone is an expense and liability that doesn't generate income, further undermining the case for financing it.
• 🙃 Prioritizing owning the newest and nicest things only perpetuates a cycle of playing catch-up and struggling to pay off debts.

Questions & Answers

Q: Why are so many people willing to go into debt for a new iPhone?

Many people view owning the latest iPhone as a status symbol and are willing to overlook the potential financial implications to satisfy their desire for the newest and nicest things.

Q: How does financing an iPhone contribute to the consumer debt crisis?

By adding more debt to already existing obligations, individuals further increase their exposure to financial stress and limit their ability to build wealth.

Q: Is it wise to finance a phone if it is used for business purposes?

While there may be exceptions for those who truly rely on their phones for business, the majority of people use their phones for social and casual reasons, making financing an expensive option unnecessary and financially unwise.

Q: What alternatives are there to financing a new iPhone?

Instead of financing, individuals can opt to buy a used phone they can afford with cash, even if it's not the latest model. This helps avoid unnecessary debt and financial burden.

Summary & Key Takeaways

• On September 12th, Apple will release new iPhones, and millions of people, including the author, are excited to get their hands on the latest model.

• However, a study by WalletHub shows that 28 million Americans are ready to go into debt to buy the new iPhone, even before knowing what it looks like.

• The author emphasizes that financing an iPhone, which is an expense and does not generate income, can hinder individuals' ability to build wealth and leave them constantly playing catch-up with debt.