Chapter 1: Case Study #2; Latisha and New Furniture

Are there any other ideas you can think of as a way for her to get the new stuff without spending all of her savings?

Deal with the furniture for a while until she does have enough money

1. Does her plan sound like a smart one? Why or why not?

Latisha's decision to purchase furniture and a new television using credit is a stupid decision.

Latisha works as a graphic designer and just got a raise of $100 each month. She wants to buy a new television and furniture and thinks this raise is enough to pay for those purchases.Tired of her hand-me-down furniture from her parents and her 10-year-old television that she got from a garage sale,she plans to use her credit card to buy the new things. Currently,she has $500 in her savings account, and she figures that with her raise she can easily do payment plans toward the television and furniture. To make the situation even more tempting, her credit limit still has $1,000 before it is maxed out. She plans to use the card toward the purchases so she can buy everything now.

Like I said please read this and make sure it matches

Is there something better she could do with her $1,000 credit on her credit card?

No because it's not real money.

2. Create a list of pros and cons that you see about Latisha's plan to purchase a new television and furniture. Make sure you are able to justify your answer

While it would enable her to buy these things sooner, she would also be paying more for them (original price plus interest). She should close the account. Latisha should save up the extra $100 that she will be making for the next 10 months and use that money to purchase the items she wants. She also needs to keep the $500 in her savings account for emergencies, not purchases.