Tuesday, March 23, 2010

A $50,000 Problem Survey: Asbestos Lawsuit, Student Loan Debt, Credit Card debt, Life Insurance debt, or Morgage Refinance fees.

In response to the budget cut's at my local school, as well as my current classes not providing a friendly random survey environment, I decided to go online for my surveys. I used a service provided by Amazon.com, called: Mechanical Turk. It allows for people to perform simple tasks for micro-payments. I used it to give the following survey.
Question 1: If tomorrow morning you woke up with a problem, which problem would you most want to deal with? (all values are in USD).
  • $50,000 in Student Loan Debt
  • $50,000 Asbestos Lawsuit
  • $50,000 Credit Card Debt
  • $50,000 Life Insurance Debt
  • $50,000 Morgage Refinance fees
Question 2: Why did you choose to deal with the problem you choose?

Here are the Results:
Problem to Deal withReason for choosing that problem
Student Loan DebtI can relate to it the most. Seems to be less complicated
Credit Card DebtCredit card debt can increase quickly because of interest rates. The other problems typically have lower or no interest applied to their amounts.
Student Loan DebtBecause it seems the most positive of all the options. Hopefully after spending this amount of money on tuition, I have tremendous knowledge and can obtain a very well paying job to pay off the debt. Also, I hopefully had many good experiences gained through the education process. An asbestos suit means I'd probably be very ill, credit card debt keeps gaining in interest so the amount is increasing, don't know why I'd have a life insurance debt but it doesn't sound good, and if it involves a mortgage I may be in danger of losing the roof over my head. So the first option sounds the best! Thanks.
Student Loan DebtI had student loan in past. The loan payments were low enough that I was able to pay it off early.
Student Loan Debtmost attractive (if possible) of the choices.
Credit Card Debtit seemed the lesser evil and actually fixable
Student Loan DebtThought it would be the easiest to handle.
Mortgage Refinance FeesBecause a place to live has always been my first priority.
Credit Card DebtBecause you an declare bankruptcy for credit card debt but not student loan debt.
Student Loan DebtBecause I have 50,000 dollars in student loan debt and it's not so bad. Credit card debt is a lot worse because the interest rates are typically higher. I don't know about the other things.
Credit Card Debti don't know
Student Loan DebtHopefully got an education out of the debt. Generally a reasonable interest rate.
Mortgage Refinance FeesBecause mortgages are a concern.
Life Insurance Debt"life insurance debt" doesn't make sense, it's impossible, so I chose it.
Student Loan DebtIt is the only problem that would be something that I might have to deal with soon.
Student Loan DebtHopefully there would be the most options available to solve the problem.
Life Insurance DebtLife must be secured. so that if it contains problems also we must face it.
Credit Card DebtIt's the "lesser of the evils." The others are impossible or nearly impossible to take care of, get help for, afford to handle. There are numerous ways to handle credit card debt.
Mortgage Refinance Feesbecause it would mean I had a house
Asbestos LawsuitHealth issues are important to deal with.
Mortgage Refinance Feesyou're gonna be paying on a home 30+ years, and at least you got something to show for the debt
Asbestos LawsuitBecause I'd have more chance of debating it in court and possibly not having to pay it; student debt is just student debt!
Student Loan DebtStudent loan debt is not something scary, it's perfectly normal and easy to pay off.
Credit Card DebtBecause credit card debt is very expensive and it's relatively easy to deal with.
Student Loan DebtLow interest, easier payment terms.

So here we have some very interesting results. It's clear that we have a pretty diverse sample of preferred problems to deal with. Here's a chart to clarify this;

Clearly Student Loan debt is the most popular problem to deal with. This makes sense in terms of interest rates too. If we consider the typical repayment interest rate on student loans, we would estimate it to be around 5%. However, comparing this to typical credit card interest, we know it to be much higher. I have heard of credit card companies typically charging an upwards of 20-30% interest. At this rate, debt rapidly accumulates, unless of course one is using introductory 0% interest credit cards to help decrease their debt.
As for the free response section, I thoroughly enjoyed the 3rd response down, where the person justifies an education and how it (usually) leads to a higher salary. I found the responses talking about Asbestos Lawsuit's quite interesting. It seams that people are open to having this be a $50,000 problem tomorrow. They figured lawsuit's can be swayed either way, allowing them to take a gamble that the $50,000 might go away if the asbestos lawsuit is won. However, I hope this person doesn't overlook the fact that dealing with asbestos can lead to Mesothelioma - a rare form of cancer that has a 'strong' correlation to asbestos.
The life insurance debt response seamed like a way out, as it does not seam to exist. Yet, a life insurance bill that is unpaid, can be considered a debt. Looking at it in another way, insurance may not seam as an important issue as student loans, credit card debt and mortgage refinance fees. After all, at least with mortgage refinance fees, the person has a roof over their head, and are refinancing for (hopefully) a lower rate.
In conclusion, this experience using mechanical turk has been quite interesting, I wouldn't be surprised If I use it again for some more survey ideas. Possibly asking people why they perform HIT's on mechanical turk, or how much money they make on mechanical turk. If you have some other survey ideas you would like to see asked on mechanical turk, don't hesitate to try to convince me!

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