She blew her college fund

I guess this has been going around the internet recently. Takes 45 mins or so to listen to the entire thing. In a nutshell, this girl had $90K left by her grandparents for her schooling. She blew it all in three years. Going into her senior year she needed $20M for tuition and such.

Listening to this on one hand sounds a total set-up. You have to figure nobody could get to age 22 and remain this clueless. OTOH, I have met many people who spent life this sheltered. People who did not know how to use a bank or that if you write a bad check you may end up in the county slam.

Is it real? Is anyone this clueless and entitled?

Not familiar with the story, but the woman who once owned the Tropicana Hotel ended up working there as a maid.

http://www.reviewjournal.com/john-l-smith/former-tropicana-owner-still-has-faith-after-mob-corporate-muggings

Can't find the maid part, but that's the story I once heard.

Heck, one woman retired to costa rica and her US attorney sold her properties there and put the money into Her Name Corporation, months later she found out she did not own that corporate entity and her lawyer used her money to pay off his criminal lawyers on a murder charge. she wound up being a receptionist in a costa rican resort she had previously owned.

Or take the Mayor of biloxi.... one sister brought gambling to town, the other sister gambled away her mortgage money and inheritance.

some people are incredibly ignorant.... we call them students.

Quote: AZDuffman

I guess this has been going around the internet recently.

haven't looked at it yet, but it strikes me that most people who are just handed 90k would mishandle it, at any age.

Many lottery millionaires are like that, regardless of age, sex, or anything else.

They burn thru the money quickly, then end up in worse shape than before they won.

when we bought our house, my wife was retired and my job was bringing in very little income. So, we had to have them look at our assets to approve the mortgage. The only thing they would value at full value or near full value was retirement funds and actual income. There is a deep discounting of cash or anything that could be turned quickly into cash without penalty.

As I said to my wife at the time, they have to rate the possibility that someone would blow through the cash and cashable assets way too fast ... it would be a high percentage of their clients. What is not a lot of money to generate income to live on can look like a lot of money to a reasonably intelligent person who just doesn't delve into what they've got. A sudden windfall can be especially at risk; what is not a lot of money, can be a lot of money to have saved ... to a mind-bending degree.

Quote: odiousgambit

As I said to my wife at the time, they have to rate the possibility that someone would blow through the cash and cashable assets way too fast ... it would be a high percentage of their clients. What is not a lot of money to generate income to live on can look like a lot of money to a reasonably intelligent person who just doesn't delve into what they've got. A sudden windfall can be especially at risk; what is not a lot of money, can be a lot of money to have saved ... to a mind-bending degree.

Two things happen. First, people live like there is no tomorrow. This chick took a trip to Europe. "Part of her education" was the justification. Probably cost her $5K. I would look and think, "no can do, that is 5% of my money!" Few are like me. Most will say, "$5K? I will have $85 left!" The bigger your circle of friends, the easier it is to do this. You know 10 people and 1 and 2 are going out on the town, invite you. So you go. Next night 1 and 2 have to work but 3 and 4 are doing something, they invite you, the cycle continues.

Other thing is so many people buy expenses. Boats are cool, they buy one. Then they find out all the ongoing expenses. When I was in car loans guys did this. Bought an Escalade. After payments and insurance they got to look at it from the barracks. No money to fill the tank.

We teach no life skills in school in the USA.

Quote: AZDuffman

Other thing is so many people buy expenses. Boats are cool, they buy one. ...

We teach no life skills in school in the USA.

Rich Dad, Poor Dad focused on the differences between how the rich and poor spend their money. Basically, poor folks buy props to appear richer than they are, middle class buys liabilities (like boats, fancy cars, bigger houses) that suck the money from their accounts, but rich folks buy assets (real estate, stocks, etc) that generate their own income.

I seem to remember a story a decade ago about a 20-something kid with money in his pocket, who shelled out big bucks to buy one of the souped up cars featured in the first Fast and the Furious movies. Next part of the story was how he put it in the car show circuit which brought in a little income every show, and didn't drive it until it had paid for itself.

Quote: zippyboy

Rich Dad, Poor Dad focused on the differences between how the rich and poor spend their money. Basically, poor folks buy props to appear richer than they are, middle class buys liabilities (like boats, fancy cars, bigger houses) that suck the money from their accounts, but rich folks buy assets (real estate, stocks, etc) that generate their own income.

It was either that book or "The Millionaire Next Door" which had a dad explaining to the kid the difference between having a lot of money and spending a lot of money. I often wonder about the younger landmen I work with and if they live it up when times are good. Some I know are good side hustlers from conversations with them, but boy is is a job you can get overextended fast.

Even when you understand not to load up with cash--sucking junk, I think you have to see people stuck to really internalize it. I know that was the case for me.

Quote: AZDuffman

We teach no life skills in school in the USA.

I think I was in the eighth grade when the NYtimes best seller list featured How I turned 1,000 into a million in real estate in my spare time. sure wasn't part of the curriculum.

I had a friend long ago who bought a low end rolls royce new. Next time I happened to see him I actually laughed in and at his face. said something to him like 'you stupid idiot, you spend so much money on a car now you can't even afford to buy sufficient new shaving blades or shaving cream.

I know one man bought an expensive car but had to ride the bus in Los Angeles because he had the car hidden from reposessors.