DHP Financial post of the week: Credit Cards, do you abuse them or use them wisely?

[JMJ]

Originally posted by Michael J. Carmona:
</font><blockquote>quote:</font><hr />Originally posted by Magic Juan:
I was one of the very few who was very responsible with his credit card. Had one at age 16 and only had to pay a late fee ONCE. Now I get all these other banks trying to offer me their cards plus I have a CC limit in the 10's of thousands. Michael, you really should consider getting at least ONE credit card because when it comes time to make a major purchase (such as a house), it will count. No credit history is a problem. magic_juan

Goodlooking out MJ, but man I already purchased my house back in August of 2001. I get offers all the time, but it's all junk mail to me. </font>[/QUOTE]Sift thru the offers and pick the best one. You may not think so, but you WILL need it for something important someday.....JMJ ;)

[blackwax]

the only time i had a credit card was in 98 on my 1st trip too nyc I cut the damb thing up when i got back and it has taken me years yes years to pay it off!!
I am not too hot with credit [img]graemlins/spanka.gif[/img]

[Gojay]

Originally posted by DiscoLady:
no credit cards for me. Debit cards are the way to go. I am making a conscience effort to spend wisely and clean up my old messes. I believe if I were to ever get another card it would be an American Express card and that's it.

Same here! Debit all the way. Need to clean up my outstandings though. Hope to do that with in the next two years.


peace
gojay

[imported_Gman]

Generally speaking (Except for things like a car,home or education) if you can't pay cash for it then you can't afford it. When you charge stuff up and don't pay it off at the end of the month then you are living beyond your means and its going to catch up with you. But you know what when you don't have all your money going to pay bills then its amazing how many things you can pay cash for.

-G

[imported_Gman]

Originally posted by Discogoddess:
Any tips to share with us scrubs who haven't made good decisions re: credit cards?

Yes... coming up

[JMJ]

I usually only use my cards (I only carry two) for emergencies or vacations (try reserving a room in Las Vegas without one). Credit cards are a must for travelling abroad. Paying by credit in Europe or Japan can save you a ton of money because of the mostly unfavorable exchange rate......JMJ

[däp]

i only use my credit card when i need to pay off another one. is that ok? [img]graemlins/conf44.gif[/img]

[JMJ]

Originally posted by t o r i n:
i only use my credit card when i need to pay off another one. is that ok? [img]graemlins/conf44.gif[/img]

Funny.....JMJ :D

[MyNia]

I got rid of all store credit cards a few years ago. I have an American Express and a Mastercard. I keep my bal under $300 and always pay more than min due.

[Erob the One]

Very important topic. Here is my suggestion. Write down all of your credit card bills and truly get a picture of what you owe. The next step is to establish your plan. Pay off the card with the highest intrest first by paying the minimum on the others so that you can send the maximum amount to the high interest one. Repeat until this is complete.

The most difficult part about being engaged was sitting down with my wife and talking over our debt. It is a very personal and sometimes embarassing ordeal. There is nothing romantic about it, but the dividens are starting to pay off. We paid off about $20k in debt including student loans within 2 years. We kept our expenses low and adjusted our lifestyles and behaviors to match our goals. We were not always on track so the lesson here is to revisit your goals and adjust accordingly.

With minimal adjustments we were still able to live a faboulous lifestyle with a couple of yearly vacations. The best thing to do is buy a house right now. Do what you can to clean up your credit and then use that buying power to spend wisely.

Hard work pays off, my wife and I were able to build our dream home right here in Chicago with instant equity and at the same time build a nice little nest egg while also maximizing our retirement accounts.

It is hard work, but sacrafice and planning and goal setting it what get the job done not only financially but life in general. Rely on your family to help you out too. You probably will ask you family for a loan for a car or trip or something, why not to help get your financial house in order.

Erob

[imported_Gman]

Something else to think about. Lets assume you have $5,000.00 laying around and you want to invest it. Where do you think you can invest the money and make an almost guaranteed 18%?, 14%? 10%? 6%? . It ain't easy to get those type of returns on "your" money let alone guaranteed. Yet we borrow money from the credit card companies and pay ridiculous rates on the money without even thinking about it. They make it so easy. Whip out the card and you can have it now. [img]mad1.gif[/img]

[JoeB]

Originally posted by Erob the One:
Very important topic. Here is my suggestion. Write down all of your credit card bills and truly get a picture of what you owe. The next step is to establish your plan. Pay off the card with the highest intrest first by paying the minimum on the others so that you can send the maximum amount to the high interest one. Repeat until this is complete.

The most difficult part about being engaged was sitting down with my wife and talking over our debt. It is a very personal and sometimes embarassing ordeal. There is nothing romantic about it, but the dividens are starting to pay off. We paid off about $20k in debt including student loans within 2 years. We kept our expenses low and adjusted our lifestyles and behaviors to match our goals. We were not always on track so the lesson here is to revisit your goals and adjust accordingly.

With minimal adjustments we were still able to live a faboulous lifestyle with a couple of yearly vacations. The best thing to do is buy a house right now. Do what you can to clean up your credit and then use that buying power to spend wisely.

Hard work pays off, my wife and I were able to build our dream home right here in Chicago with instant equity and at the same time build a nice little nest egg while also maximizing our retirement accounts.

It is hard work, but sacrafice and planning and goal setting it what get the job done not only financially but life in general. Rely on your family to help you out too. You probably will ask you family for a loan for a car or trip or something, why not to help get your financial house in order.

Erob

no matter how many times i've read the similar methods to lower debt, it never get tiring and old. thanks for sharing, erob.

[Erob the One]

No prob - we just have to stay diligent. Hell, if you can be passionate about music, food, art or anything else then surely your finances can get some prime time.

Erob

[DJ Timmy Richardson]

Originally posted by Gman:
Something else to think about. Lets assume you have $5,000.00 laying around and you want to invest it. Where do you think you can invest the money and make an almost guaranteed 18%?, 14%? 10%? 6%? . It ain't easy to get those type of returns on "your" money let alone guaranteed. Yet we borrow money from the credit card companies and pay ridiculous rates on the money without even thinking about it. They make it so easy. Whip out the card and you can have it now. [img]mad1.gif[/img]

How bout the Gov't borrowing your money every year interest-free and then giving you a refund. Try to use their money for a year and see how much you owe..

Some other cards worth having but only if you use them right are PC Richard, Sam Ash, or any card that allows you to pay off in a certain amount of time interest free. Right now Sam Ash is like 18 months no interest. But, they are banking on you not paying in time. Then they charge you the interest dating back to the time you borrowed the money.

[SMOOTH87]

I stay away from them [img]AR15firing.gif[/img] ..... Learned my lesson :(

Thank God 4 Debit cards!! [img]biggrinangel.gif[/img]

[(Im)poster]

Originally posted by DJ Timmy Richardson:

Some other cards worth having but only if you use them right are PC Richard, Sam Ash, or any card that allows you to pay off in a certain amount of time interest free. Right now Sam Ash is like 18 months no interest. But, they are banking on you not paying in time. Then they charge you the interest dating back to the time you borrowed the money.

I love these deals and anything that allows me to beat creditors at their own game. It's fun like a sport to me. Here's a tip if you pay balances in full: Wait until the day after your statement closes to make a major purchase and then you can float it interest-free for 50-60 days (depending on your billing cycle). On the 90-days-same-as-cash type plans, you always have to read the fine print because some plans start charging interest from day one and others (rare these days) really don't start charging until the first day after the promotional period if the balance is unpaid. Watch out for those who will revoke the interest-free deal if you make even one payment late. If you are disciplined, these deals are a great way to hold onto your money a little longer.

Also, if you tend to pay your bills in full and on time and you slip up and pay a little late once (or twice) ALWAYS call and have the late fee/charges reversed. They will reverse charges for customers with a good payment history. Don't waste time with the customer service reps, ask for a supervisor who has the power to make such decisions.

[ July 17, 2003, 11:37 PM: Message edited by: (Im)poster ]

[Monny JcIntosh]

Originally posted by Gman:
Generally speaking (Except for things like a car,home or education) if you can't pay cash for it then you can't afford it. When you charge stuff up and don't pay it off at the end of the month then you are living beyond your means and its going to catch up with you. But you know what when you don't have all your money going to pay bills then its amazing how many things you can pay cash for.

-G

That's how I live now. When I was at college I was terrible with credit. I lived for a while afterwards at my credit card and overdraft limits but decided a while back enough was enough. Now I'm looking at buying a flat with my girlfriend, and still be able to work part time and pay the fees on a graduate course. I still have 4.5K student loans outstanding but the interest on them is very low, and I'll wait until I have finished the MA before tackling them.

[C hristian]

i have no credit cards, only debit cards that act like credit cards. BUT, I have school loans that are in default.

[imported_Gman]

Originally posted by C hristian:
i have no credit cards, only debit cards that act like credit cards. BUT, I have school loans that are in default.

I had student loans that were in default as well. Have you started to pay them back ? Don't make a big deal out of this. Start to pay them something, whatever you can afford but send them something. I imagine mister bill collector is calling as well. Take the initiative and call them and tell them you are interested in making this debt good. Tell them you can only pay this amount every month. Don't let them bully you.

-G

[MC]

Originally posted by Magic Juan:
I was one of the very few who was very responsible with his credit card. Had one at age 16 and only had to pay a late fee ONCE. magic_juan

Juan,

You're a better man than I am. I couldn't manage those damn cards. I wish I could've been more disciplined with them, but oh well I learned from my mistakes.

[Wild i]

I've come to accept the fact that I'm no good with credit. Consequently, I am currently trying to eliminate my debt. I've got 2 store cards to go, which I would be able to just pay off (both under $500) were it not for my car note and insurance, both very high in NYC. They get paid off during the next cycle (after the insurance is paid).

My solution to staying on an even keel has always been to stay out of the stores. That works pretty well, but now there's internet shopping and that can really sneak up on you. For example: just yesterday I had to break my own fingers to keep from ordering sheet music on line. Then I priced a new laptop and sat it in my shopping cart. I have 30 days to decide on that. So within an hour I came within a hair's breath of spending over a grand without leaving my seat.

So here's my two cents: BE VERY VIGILENT ABOUT SHOPPING ON LINE. If you make a pact with yourself only to buy what you must GO TO THE STORE to buy (with the exception of substantial savings buying on line), you'll find yourself buying a lot less. For example, I only know of 3 really decent spots for sheet music and they usually don't have a clearance bin on-line. Having to get up a get it also gives you time to consider whether or not you really need it.

One of the biggest problems me and my sigo have is her determination to remain insolvent. A few years ago she cleaned up all her credit, no mean feat since she'd defaulted on her mortgage. Now she's almost back to square one and the whole time I kept telling her to stop buying things she didn't need. Got a closet full of clothes with the tags sill on them for over a year.

Don't get me started....

[Wild i]

I've come to accept the fact that I'm no good with credit. Consequently, I am currently trying to eliminate my debt. I've got 2 store cards to go, which I would be able to just pay off (both under $500) were it not for my car note and insurance, both very high in NYC. They get paid off during the next cycle (after the insurance is paid).

My solution to staying on an even keel has always been to stay out of the stores. That works pretty well, but now there's internet shopping and that can really sneak up on you. For example: just yesterday I had to break my own fingers to keep from ordering sheet music on line. Then I priced a new laptop and sat it in my shopping cart. I have 30 days to decide on that. So within an hour I came within a hair's breath of spending over a grand without leaving my seat.

So here's my two cents: BE VERY VIGILENT ABOUT SHOPPING ON LINE. If you make a pact with yourself only to buy what you must GO TO THE STORE to buy (with the exception of substantial savings buying on line), you'll find yourself buying a lot less. For example, I only know of 3 really decent spots for sheet music and they usually don't have a clearance bin on-line. Having to get up a get it also gives you time to consider whether or not you really need it.

One of the biggest problems me and my sigo have is her determination to remain insolvent. A few years ago she cleaned up all her credit, no mean feat since she'd defaulted on her mortgage. Now she's almost back to square one and the whole time I kept telling her to stop buying things she didn't need. Got a closet full of clothes with the tags sill on them for over a year.

Don't get me started....

[mhd]

funny credit story, yesterday i negotiated the payoff of someone's credit card, they owed 400 last august, last week they said the balance was over 1,000 (no additional charges, just interest) they then offered to settle it for 750, i asked for a detail of the charges, they then offered to settle it for 650, i told the guy we would be willing to pay 500, he said this was not lets make a deal i said everything is negotiable and he hung up on me. they called back the next day to say they would take the 500.

[mhd]

Originally posted by darrow:
</font><blockquote>quote:</font><hr />Originally posted by JMJ:
</font><blockquote>quote:</font><hr />Originally posted by darrow:
Another word of advice regarding credit reports/fico scores.

If you go to a site like Equifax's for instance (www.equifax.com), you'll see you can purchase a 3-in-1 credit score. Through Equifax's site, you can get a comprehensive credit report that includes data from Equifax, Experian, and Transunion in one package as well as your FICO score from Equifax (the other agencies also have FICO-like scores but they are not called FICO).

My suggestion...don't do the 3-in-1 deals.

I did a 3-in-1 from Equifax. The Equifax report was cool. The Transunion one was all F'd up and had some other guy's stuff (same name, different ss#) on my report. Typically if you see a problem on a report, you can dispute it through the reporting agency. Not so in this case. I couldn't dispute the Transunion stuff through Equifax's online site. I had to dispute it through Transunion's site. The problem was that in order to dispute it, I needed a Transunion credit report. That meant BUYING a Transunion credit report (though I already had one via Equifax's 3-in-1 product). I ended up having to dispute Experian's also, so again...I paid for an Experian one.

Had I just gone to each three and got the reports individually, I probably would've saved a lot of time and hassle as well as a bit of money.

Most banks and finance companies use Transunion reports when considering auto loans, so make sure yout Transunion report is current and accurate. Check it every six months. You may be able to obtain a free report once a year in the very near future.......JMJ </font>[/QUOTE]Transunion was also very responsive and had the three questionable items off my report in no more than two weeks.

For some reason Transunion wasn't used for my home purchase last year but was for my refinance this year. Go figure. </font>[/QUOTE]this is a constant problem, tell us what steps you took to remove the wrong data, i'm guessing providing the proper ssan cleared up the identity problem, were there any other problems that they corrected?

[mhd]

Originally posted by blackwax:
the only time i had a credit card was in 98 on my 1st trip too nyc I cut the damb thing up when i got back and it has taken me years yes years to pay it off!!
I am not too hot with credit [img]graemlins/spanka.gif[/img]

man, what did you buy? the brooklyn bridge?