Would You Take Out a Loan for a Video Game?

My Journey out of Debt

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Would You Take Out a Loan for a Video Game?

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My son loves video games, and has a Playstation 2. But he has wanted an Xbox 360 for a very long time.  He has been saving his money from babysitting and picking up after our neighbor's dog to buy one, but saving up for something that expensive will take quite awhile. 

During the summer, my wife's younger brother moved in with us to save money while he went to college. He has an Xbox 360, so my son was obviously thrilled to have access to one.

In October, he used some of his hard-earned money to pre-order a new video game coming out in November and was anxiously waiting for it to be released.  Unfortunately, between the time he pre-ordered the game and the time it was released, my brother-in-law unexpectedly moved out, and took his Xbox with him.

Would You Take Out a Loan for a Video Game?On the day the game was released, my son and I went to the local video game store to pick it up. He was obviously disappointed that he no longer had a game console to play it on.  When we got to the store, the clerk explained that they just reduced the price of older, used Xbox 360 consoles.  We looked at the used consoles, as well as the sleek, new models.

After plunking down $60 for the game a month earlier, my son still had enough money saved for a used console, but not enough for one of the new ones.  I could see that he really wanted to buy one of the new ones, but was torn between purchasing a used Xbox and being able to play his new game now, or waiting and saving up additional funds and purchasing a new model sometime in the future. 

At that point, I found myself thinking, "If I only could use a credit card, we could get a new model, and he could just pay me back over time." I justified this thought process by thinking of the warranty that would come with a new one, as well as how much longer a new model would potentially last compared to a used one. 

It then occurred to me that what I was really thinking was that I wanted to take out a loan to buy a video game console. 

That's really what we're doing when we use credit cards. 

We're borrowing money from a credit card company to purchase something.  We make payments on the balance, with interest, just like your car loan, or your mortgage. 

That fact has completely been lost to me for a very long time.  When I was at the height of my credit card usage, my wife and I were buying furniture, taking trips, and supplementing our income with credit cards.  We were taking out loans to purchase things, and do things that we didn't need and didn't have the money for.

As mentioned in a previous blog, I recently had a regression in my quest to become credit card debt free when I discovered an active credit card account with a zero balance that was not in my debt management plan. 

I need something to keep me from continuing to regress in the present and as I move into the future.  This experience may just be the trick.  The next time I feel the urge to pull out that credit card to buy something, I will think to myself, "Is this purchase worth taking out a loan, and borrowing money for?" 

Related Links:

 A Change in Financial Seasons

Running the DMP Marathon

 Because I Deserve It

My Journey out of DebtTravis Pizel

Travis is a contributing writer for the My Journey Out of Debt blog and is a very active member of the community forums. Travis is currently enrolled in a CareOne Debt Management Plan and in his posts he shares his personal journey to pay off his debt and the tips he's learned along the way. As a father and husband he provides a unique perspective on balancing debt, finances, and family. Compensated CareOne Blogger.

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  • Good for you for catching yourself before making that mistake again!  The motto I use to stay debt-free is "If I can't afford to pay for it with cash, then I can't afford it."  It's all about habits and changing those habits.  Funny how we can rationalize just about any purchase though.  The funny thing is, credit cards are much worse than loans because the interest rates are so bad.

  • love this concept.  a unique and obvoius perspective.  thanks so much!

  • Thanks for your comment, Cherl_G!  Normally I don't go into a store without a specific list of what I'm going to buy and this was an unexpected thing that presented itself.  I'm glad that my son and I really took our time and made the right choice!

  • Thanks for your comment, mismandyrose.  It's funny how sometimes we miss the obvious.  It whizzed right over my head for 14 years.

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