It's good to know there are people more profligate than me. Makes me feel better. At least I manage to make my mortgage payments, even if the rest of my finances are a mess :)

the couple took on the medical costs of in-vitro fertilization therapy in an attempt to have another child. The expenses helped tip them into the bankruptcy filing.

They fucking what? At least my money goes on useful and harmless things like booze, smokes, and strippers - how on earth did they think they were going to support another child?

I waited until my mid-30s to get a DOG so I could be sure I could afford it.

Oh, and have all the booze, smokes, and strippers you want as long as you're paying for them, and we won't be paying the price on the back end.

I have a hard time comprehending how stupid those people are, especially after filing bankruptcy!

SO and I do the envelope system for our budget. I've always done mine differently without actual envelopes and cash, but I'd have a list and mark down how much went to each thing. This method wasn't so easy for him. We went through the Dave Ramsey program several months ago and SO has been following his plan including the envelope system ever since.

I filed for bankruptcy in 1997. I cannot tell you how mortified I was that I had to.

Long story short, you NEVER have a kid you can't afford. I was childless, and it was bad enough. HOW can you contemplate bringing a child into the world when you CAN'T PAY YOUR BILLS???

Oh, and have all the booze, smokes, and strippers you want as long as you're paying for them, and we won't be paying the price on the back end.

Well, different country Amy so you won't be paying for me in any case. And yes, it's my money, I earn too much for welfare of any sort. And we have mandatory contributions to private retirement accounts rather than the idiocy that is Social Security, so I'll be supporting myself in retirement too.

Anyway, sin taxes are much higher here than you're used to - a pack of cigarettes is $18 now for instance. In parity $US/$Aust. Something like 90% of that is tax. Anyone who complains I haven't paid in advance is going to get an account for the contributions I've made along the way. It'll be way more than I ever get back.

Although this is only partly related to the problem, take a look at the psychological effect of a Target or Walmart. Surrounded by so much evidence of plenty, the consumer is told, "This can be YOURS!" Lots of merchandise goes out the door because it was there, and its mere presence meant it could be afforded. Especially when the credit-card company says at least once a week that you need to use your card. And here's another!

With such great role models in DC, state capitols and city hall, is anyone surprised? Teetering on the brink of bankruptcy is the new American culture!

Remember there was that website a decade or so ago that was on the news, some girl had run up lots of debt and asked for donations? And got them?

I'll tell you all this because you don't them (or me)... My in-laws filed for bankruptcy at the end of the year. I found out two weeks ago that my mother-in-law hired a maid again.

No shame. Seriously.

And now, I understand Husband's financial incompetence. These people were the financial role models he grew up with. (Sweet as he is... he can listen to Dave Ramsey, talk about the points made on the show, and 30 minutes later talk about wanting to take out a home equity loan for a pool.) This is why I'm in charge of our finances.

I think a large part of the problem is how we are raising our kids. There is to much worry about self esteem and not enough instilling of guilt for bad behavior. There is also to much of the attitude that it is OK to take from the "big corporation." That big corporation provides jobs and provides the retirement income for many people. So, when these people refuse to pay their debts, they are not taking from big evil corporation. They are stealing money from every person who invested in that corporation and possibly causing other people to lose their jobs.

How were these people able to get the debt wiped out?

I looked into bankruptcy 6 years ago because I had a really terrible year--car accident, bought a new car, lost job 3 weeks later, had new job within 10 days but was lied to about income potential (Jenny Craig, dependent on their leads because you can't go up to people and say "hey, you're fat, come buy my shit!). Car repoed. Yeah.

So when the lawyer did the math on my meager earnings ($2200 month or so) and what I owed, we found that because I had cut spending back to the bare bones I would have had to spend all my disposable income on paying my creditors back (whichever form that is), not get it wiped out entirely.

Surely these people have numerous areas where they can cut back, so why did they get the "Whee, I'm free" bankruptcy?

@Timothy--

Having worked in the back office of a cutthroat debt collector for a few miserable months, I can tell you that when a business sells off their debt they have greatly lowered the chance of anybody getting paid back.

See, when debt is sold, it's called a write-off. The original company has already written it off their taxes. Your credit score has already dropped. Any money you pay is going to the debt collector, not the original creditor. And you think paying your debt will raise your credit score? Nuh-uh. In fact, it may lower it because you've restarted the clock on the debt.

This whole system is why people aren't paying their debts. I would be happy to pay my original creditors back if doing so raised my credit score. I refuse to pay one thin dime to collectors. And I'm systematically raising my credit score by making on-time payments to my current creditors while letting stuff from my marriage and my "terrible, horrible, no-good, very bad year" drop off. I have zero incentive to operate any other way, as per the corporate set-up.

I don't know this couple (L and S Furry) personally. And, some people are prone to living irresponsibly, no matter what times they are living in. But it occurs to me that the current climate (and you can take that to mean environmental/social/political) might induce folks who would otherwise live sensibly to go off the deep end. If people buy into all of the gloom-and-doom (Mayan Calender says it all comes to a halt in Dec. 2012, melting icecaps will have our cities underwater, crazy dictators with nuclear warheads, etc.) they might tend to live beyond their means and not deny themselves anything in the NOW. Don't get me wrong -- I don't condone this behavior. And I don't buy into the end-times hype. People have been predicting end-times for thousands of years. It's just that I think there are certain personality types that are affected by the negative climate that proliferates and is shouted at us (top-volume), non-stop from the airwaves. Me? I'm very good at hitting the "OFF" switch, going for a hike in a nature setting, or picking up a best-seller at the library. Whatever works.

Just read the article.

Sporadic work for the hub and she home-schools?

$62 grand a year and a $400k mortgage?

What huge maroons. And I'll ask again--why do people who voluntarily take on giant debt beyond their means while simultaneously refusing to work get their debt wiped out, but someone who refuses to take unemployment and keeps money rolling in by any means possible is inelegible for help? Why?

I think people get focussed on the wrong way of looking at things, by allowing themselves to think that certain things MUSt be done, therefore the money must be spent, even if it's kinda not there yet [or ever].

Once they are fixated like that, they don't see the ability to change.

This begins with the word "You Deserve..."

It's easy and very seductive. It doesn't pose a problem 'till the money stops coming in. Some people immediately go into hunker down mode, and some keep whistling past the graveyard as if it can't happen.

There just really has never been a good answer to this, because there will always be people who game a given system, regardless if welfare queens, or people who abuse the bankruptcy system, or CEO's that drive their companies into the ground, but hit the golden parachute on the way out...
they give all the people who work their way out of those holes a bad name, but they have never figured out a way around it

The laws changed for Bankruptcy a few years ago, so this couple may have gotten under the wire with the old laws. I filed chapter 7 back in 2003 because of $40,000 in legal fees in a custody battle. It almost broke me...but I tell you, even though I knew my credit rating was crap for awhile, it felt good to screw the credit card companies for once.

I am very careful with my money now. I have accumulated more debt since '03 but now will be debt free in May. The BK never really hurt my ability to buy anything. I bought a new Honda shortly after and just bought another new one. That is the only debt I will have. As far as housing, I have decided that buying a house is one of the worst mistakes I could make. I pay rent with no property taxes, no maintenance, no association fees, no housing insurance, no high utilities...you get the drift. Much easier to be an apartment dweller than spit out all that money every month just for a place to live.

I'm saving the money saved for my retirement, if that is even possible...

These people are scum. No doubt about that in my mind.

But who the FUCK would let them take out a 400k mortgage in the first goddamned place?

Any responsible lender should have been able to see that they couldn't possibly afford the place!!!

how on earth did they think they were going to support another child?

I don't think that question ever crossed their minds. As Swiss explains,

This begins with the word "You Deserve..."

Most people - even the ones who otherwise seem rational - lump having children into a completely different category than other spending. No one will feel sorry for you if you are broke but go out and buy a boat, but even the average person seems to think that you are entitled to having all the kids you want, regardless of your financial situation. People seem to think you come into this world with that entitlement stapled to your left-hand corner, availability of resources be damned.

If you disagree with me, try this: The next time you hear someone whining about "How are you supposed to feed four kids on 'X' dollars" or some variation of that theme, suggest that people who only make 'X' dollars not have kids. You'll be called a child-hater, a big meanie, and everything in between. I think it just makes people squeamish to consider that human beings are subject to the same laws of supply and demand as everything else. To view things this way is seen as "dehumanizing" or "insensitive" even though it is completely and inarguably true.

Well, looks like we've found someone who could have benefitted from Obama's advice to cut back on restaurants and vacations--at least he wasn't completely out of touch, right?

I think part of the reason this is becoming a growing problem is that no one wants to live below the standard to which they are accustomed--ie how they were raised. For the past 100-150, this has been achievable as society was on an upwardly mobile trajectory. My great-great grandparents were dirt-poor immigrants, great-grandparents were working class, grandparents were solid middle class high-school graduates, parents are professionals with masters degrees who were able to raise me in an upper-middle class suburb where going to college, taking vacations, three cars & swimming pools are the norm.

Not going to lie, it would be hard to downgrade from that. But it was interesting to look around me in high school and see people who, for various reasons, were probably never going to be able to achieve the same level of financial success as their parents. I mean, there were kids who grew up in million-dollar houses and were dropping out of high school to wait tables. You really think someone who got a new car on their 16th birthday is going to be okay with driving a used clunker for ten years? I doubt it--my guess is that people like this end up like the Furry's, living way beyond their means because that's what they're used to and feel they deserve.

Shannon, are you Generation Y, by any chance? Your parents sound like Baby Boomers.

The reason I ask is that I think I'm one generation ahead of you - it was my parents who were high school graduates, and my grandparents who were working-class. I graduated from college, but only have one other cousin/sibling (out of five of us total, including me) who did so. One is a factory worker, one is in the military, and the third is a tradesman. So out of the five of us, only two of us went to college. The other college grad is a Franklin Templeton fund manager who makes more money in a year than I'll ever make. A sweet guy with a genius-level IQ, pretty much. I'm a white-collar contract worker.

But it's interesting to see these same historical changes from the perspective of someone who is (I'm guessing) 10-15 years younger than I am. You came of age during a bubble, but I came of age during the recession of the 80s. My Strauss & Howe reading is showing, I guess.

When I look at the Boomers, I wonder what it would be like to grow up in such a positive, robust time in history - how it would shape your perspective to experience your childhood during a time when things would always get better.

"They need a reality check."

If they had one, they'd probably try to cash it.

I'll cut them some slack since unlike all the other people who did the same things they actually had the guts to go to the LAT for a financial makeover and let their names be put in the paper, opening them up to all kinds of abuse. That suggests they have some idea that they need to change their ways and want the shame and outside pressure to force them.

Also, most of their problems stem from trying to live a traditional, family-oriented lifestyle in Los Angeles. If you didn't buy a house 20 or 30 years ago, you'd better be rich, childless, or comparing your life to rural poverty. If they lived in Dallas, they'd have no problem making ends meet on the same income.

I've bought into the lie -- at times. I've paid back more than one bill/card/loan off at the charge-off rate. While my credit rating isn't 800 -- it is north of 600. I have considered bankruptcy on and off, but just couldn't bring myself to it.

When I bought my house -- it was what I could afford -- not what I deserved. I enjoy it. And even now -- post burst -- I could probably sell it at least at mortgage -- if not some equity.

*****If you disagree with me, try this: The next time you hear someone whining about "How are you supposed to feed four kids on 'X' dollars" or some variation of that theme, suggest that people who only make 'X' dollars not have kids. You'll be called a child-hater, a big meanie, and everything in between. I think it just makes people squeamish to consider that human beings are subject to the same laws of supply and demand as everything else. To view things this way is seen as "dehumanizing" or "insensitive" even though it is completely and inarguably true.*****

Were you sitting next to me in my last HOA meeting? Because you must have been reading my mind.

There's one girl (I say girl because she CAN"T be more than in her late 20's) who has four, count 'em, FOUR kids, and whined 3 years ago about not being able to afford an extra $5 a month in HOA fees. This year it went up $50 (which is a long rant for another day) and she started to cry. Like that was going to get her anywhere. All I could think is, "You had two kids the last time you cried about parting with an extra $5, and now you have FOUR. WTF were you thinking?"

And yes, she is a single mom. The mind boggles.

"If they lived in Dallas, they'd have no problem making ends meet on the same income."
Not the way they're living, they wouldn't. And it's likely that the husband wouldn't make the same salary, either.

"No one will feel sorry for you if you are broke but go out and buy a boat, but even the average person seems to think that you are entitled to having all the kids you want, regardless of your financial situation. "

The difference is that we all know you wanted the boat, whereas kids may or may not have been planned and its a bit of an indelicate question to ask. I'm going to cut married couples a break on this one. There are a lot of people who don't believe in any birth control whatsover for religious reasons; accidents can happen even when you are on the pill; and are we really going to tell married adults that they have to stay abstinent or use a condom every single time? Single mom's are another story--if you don't think premarital sex is going to send you to hell then God should be okay with you getting on the pill.

and are we really going to tell married adults that they have to stay abstinent or use a condom every single time?

If they can afford kids then yes.

I'd like to see birth control added the water supply, that way the only way too have a kid would be to go to a doctor and get a counter agent.

As there is no hormonal male birth control, and no universally safe female birth control I realise this is a pipe dream, but it is a pleasnt thought none the less