GIRLS' ROOM! Credit [spit from Downsizing is HARD! Immobilized!]

[Txjaybird]

You had the same thing happen two years ago and it did not occur to you to get a credit card and just use it once in a while and then pay it off at the end of the month to establish credit? That would have made your life easier, now, and you did not have to go crazy in debt.

I AM NOT ""CRAZY IN DEBT"  I don't know where that info is coming from?     CRAZY maybe...not debt ridden.

Oh it occurred to me to get a credit card.....My bank offered to let me  put $300.00 in a account  to "secure a credit card" and they would only charge me  $39.00 A YR. TO HOLD MY MONEY HOSTAGE.   I declined, not politely.  I have had offers of cards that charge from around $40 to $100 per year fees with really high interest fees up to 27% or more.  I know someone in that trap that had to use the card for meds. & food last year, however this year is going better for them.

Thankfully my income is enough that I have what I need and most of what I want  When big ticket items appear I buckle down and save.  Credit would be nice for a van loan...I'm looking into that.

You have an excellent memory.  I did not  even remember posting the credit situation previously.....not sorry for the redundancy however some things just get said more than once, that's life.

 

[RV-Hopeful]

Well I am not one to buy a new anything. Depreciation is a nonstarter for me. Unexpected emergencies? That's why I have an EF so I don't need to rely on CC debt to get me out of a jam.  A debit card or cash works just fine for renting a vehicle.  If you are concerned about hacks, then have a separate account/debit card for the sole purpose of renting.

ggwoman, it's great that you can afford to buy with cash, lots of us aren't as lucky. 

I don't buy new, get my clothes at a thrift shop, use coupons as I can but unexpected emergencies, i don't know -  we (the credit people) are working to whittle down the debt to get on the road and start saving so we too may be able to have an emergency fund ... until that point, when emergencies strike we have to do our best.

 

[Cheli]

Thankfully my income is enough that I have what I need and most of what I want  When big ticket items appear I buckle down and save.  Credit would be nice for a van loan...I'm looking into that.

Same here.  I do pretty well on my own and can afford pretty much what I want, but also buckle down and save if I need a big purchase item.

I haven't used a credit card in four years and the only loan I have is my car.  I have two separate bank accounts at different banks with my money split up.   If one gets compromised I still have the other, never leave all your eggs in one basket.  I use my debit Visa card (which is used like a credit card) if I need to rent a car, buy a Kindle book or whatever else was mentioned that you have to have a credit card for.  Nope, haven't needed a credit card in four years.  Btw gcal, credit cards can be hacked too and your debit card and bank account could still be hacked even if you don't use them for online stuff.  Anyone can hack anything anywhere.

If I don't have the money, I don't get it until I do.  I have a sufficient emergency fund saved that I don't touch but realize that I need to increase that for when I hit the road.

 

[Cheli]

Different strokes for different folks, I guess. I did not mention it, but the biggest reason I can think of for having a CC is safety. It is a lot safer than carrying cash, especially in unfamiliar areas or tourist traps. If your pocket is picked or your purse is stolen, any cash you are carrying is gone forever. If a CC is taken, your loss is strictly limited. I very seldom have more than $20 in cash on me. Usually  it is less.

I totally agree.  I never carry more than $50-100 on me at any time.  But I can call my bank just as easy (or easier) than calling a credit card company if my wallet was stolen. 

But yes you are right......we all have different ways of living our life and we do what works for us. 

 

[gcal]

I AM NOT ""CRAZY IN DEBT"  I don't know where that info is coming from?     CRAZY maybe...not debt ridden.

Oh it occurred to me to get a credit card.....My bank offered to let me  put $300.00 in a account  to "secure a credit card" and they would only charge me  $39.00 A YR. TO HOLD MY MONEY HOSTAGE.   I declined, not politely.  I have had offers of cards that charge from around $40 to $100 per year fees with really high interest fees up to 27% or more.  I know someone in that trap that had to use the card for meds. & food last year, however this year is going better for them.

Thankfully my income is enough that I have what I need and most of what I want  When big ticket items appear I buckle down and save.  Credit would be nice for a van loan...I'm looking into that.

You have an excellent memory.  I did not  even remember posting the credit situation previously.....not sorry for the redundancy however some things just get said more than once, that's life.

You missed one of my posts. I explained that I ran one of your paragraphs together with someone else's who split yours up when she replied to you and that is what I responded to.

 

[gcal]

I totally agree.  I never carry more than $50-100 on me at any time.  But I can call my bank just as easy (or easier) than calling a credit card company if my wallet was stolen. 

But yes you are right......we all have different ways of living our life and we do what works for us. 

The difference between calling your bank about a debit card  and calling the cc company is that, if the thief is quick enough, your account can be emptied and you are left wherever you are without funds for as many days as it takes to get things straightened out.  If your checking account is linked to your savings or investment account, that will create addition difficulties. In some cases, you can be held responsible for cash taken and/or may have to jump through additional hoops to get your cash back. With a cc, you still have a source of cash to draw on and your losses are limited by law. Make sure you know what you agreement says

 

[VanDwellerMod]

FYI: The first 26 posts in this thread were split from the "Downsizing is HARD! Immobilized!" thread. A few of the posts have been edited to keep the focus on the topic of credit.

 

[ggwoman]

ggwoman, it's great that you can afford to buy with cash, lots of us aren't as lucky. 

 but unexpected emergencies, i don't know -  we (the credit people) are working to whittle down the debt to get on the road and start saving so we too may be able to have an emergency fund ... until that point, when emergencies strike we have to do our best.

RVHopeful,
It took me years and years of major sacrifice and working extra jobs and a major change of mindset, to finally pay off my school loans, car loan and stupid credit card debts.  And that was as a single parent on an underpaid teacher's salary in the most expensive state in the nation, HI.  That's why I am so vehement about it now.  I struggled hard for a long time and  I will never, ever ever let that happen again.  It was a WAR toward the end believe you me.  

I do not believe in any "advice" from the financial world anymore either.  A credit score means absolutely nothing.  It's just some faked algorithm they won't share the secret of to keep people paying them interest and living as debt slaves. And the same jerks crashed the world's economy and then we and our grandkids' grandkids are forced to bail them out of that too.    Their advice is dangerous, dirty and unfair.  They know that VERY few people have the wherewithal and/or the will power to avoid debt in this society. Just take a look at the media.

Kudos to you for starting the process.    You are so right to want to whittle down debt, but I found out the same as you, every time I made some headway, something would happen to require that slated money.  So instead of going to the debt, it went to the 'emergency'.  Talk about frustrating.  Then I changed my focus.  I started listening to folks like Dave Ramsey, started remembering what my great grandmother said regarding family survival amid the multiple depressions at the turn of the century.  I also cut of my cable, started doing accounts the old fashioned way (still do), made an emergency fund of $1000, (sold stuff, saved hard, ate ramen a lot and paid minimums) so that  when an emergency happened, (which it always does) I had the EF to use, so I could keep paying down the debt.  No excuses.  For me, psychologically it worked, because I was still making headway.  It gave me time and breathing space too, of a month or so to get a few extra bucks made (mowing lawns, working over break, tutoring, selling something) to replenish the EF.  It made me competitive with a monster lie and woke me up.  Now, that I'm out of debt, I breathe and sleep easier.  There's less worry.  And for some reason, there's more money now. I don't get it, (and yes I understand the part about no interest money lost now but there's something else too,)  Anyway I am grateful to be free.  Every time I use cash now, (a check or debit swipe is also using cash) it's like saying F*&$ you to the bastards. Whoo hoo, but it does feel good!  Towanda!

Try to think of the EF as your eventual down payment on the RV.  Try paying yourself first right now and get that EF together. Pay minimums on everything else until you have it built.  Then you can concentrate and attack that debt with everything you have.  You'll have armor, you'll have weapons, you'll have a backup.  And most importantly, you'll have your Dream.  That's so very important.  Now granted, it seems like it takes forever... at first, but then, you see headway and it becomes addictive, like a contest.  Only the outcome is clear: YOU win!  

 

[Txjaybird]

FYI:  The first 26 posts in this thread were split from the "Downsizing is HARD! Immobilized!" thread.  A few of the posts have been edited to keep the focus on the topic of credit.

Thanks For The Info       TJB

 

[Cheli]

I started listening to folks like Dave Ramsey, started remembering what my great grandmother said regarding family survival amid the multiple depressions at the turn of the century.  I also cut of my cable, started doing accounts the old fashioned way (still do), made an emergency fund of $1000, (sold stuff, saved hard, ate ramen a lot and paid minimums) so that  when an emergency happened, (which it always does) I had the EF to use, so I could keep paying down the debt.  No excuses.

I started listening to Dave Ramsey about seven years ago.  My ex husband and I were living like idiots and although our combined income was very good, we were always struggling to pay the bills each month because we were in such debt.  So I bought his book, listened to him on the radio everyday and we implemented his plan.  In 2 1/2 years we paid off $65k in debt (student loans, auto loans, motorcycle loans and credit cards).

We separated four years ago and I got myself in a little mess while trying to learn all over and adjust to one income.  But in the last 2 years I've paid off about $12k in debt and only have my car loan.  I also have my EF of $1k and because I have it, I haven't needed it......you know Murphy's Law right?  hahaha  I also got rid of cable about a year and a half ago and don't miss it a bit, and save myself $190 a month. 

I will continue saving and paying off my car and selling my stuff and hope to have a van and on the road by the end of the year.  It's an ambitious plan but I can do it.

Anyone can do whatever they want.  Income to debt ratio doesn't matter, you just need to be determined and have a plan and do it.  Don't let anything else intimidate you.

 

[ggwoman]

" I also have my EF of $1k and because I have it, I haven't needed it."

Cheli, inspiring story you have told. That's the kind of thing I needed to hear and why I found DR and his radio program such a great resource. Your quote is what I mean about having more money. Whether it's Murphy's Law or what I don't know, but when you are prepped and rocking and rolling to make something happen for yourself, it just seems like the Force or the Universe or God or whatever is on your side helping. I just know that sooner rather than later, you will have your van, your freedom and Dreams coming true.

 

[DebC]

I started listening to Dave Ramsey about seven years ago.  My ex husband and I were living like idiots and although our combined income was very good, we were always struggling to pay the bills each month because we were in such debt.  So I bought his book, listened to him on the radio everyday and we implemented his plan.  In 2 1/2 years we paid off $65k in debt (student loans, auto loans, motorcycle loans and credit cards).

We separated four years ago and I got myself in a little mess while trying to learn all over and adjust to one income.  But in the last 2 years I've paid off about $12k in debt and only have my car loan.  I also have my EF of $1k and because I have it, I haven't needed it......you know Murphy's Law right?  hahaha  I also got rid of cable about a year and a half ago and don't miss it a bit, and save myself $190 a month. 

I will continue saving and paying off my car and selling my stuff and hope to have a van and on the road by the end of the year.  It's an ambitious plan but I can do it.

Anyone can do whatever they want.  Income to debt ratio doesn't matter, you just need to be determined and have a plan and do it.  Don't let anything else intimidate you.

When I was married, we attended Dave Ramsey's Financial Peace University.  It felt good to have that emergency fund and get debt paid off.

Fast forward to present day...I am debt free and am saving significantly each month (I work a full and part time job) to be able to buy a van, class B or C hopefully by year end so I can attend the RTR in January.    I really need to decide what rig I want... :s

Oh..something I do that Mr. Ramsey would be appalled at..I use my CC for airplane miles! 
I never carry a balance and use it like a debit card.

As you say..different strokes for different folks!

Deb

 

[Cheli]

I just know that sooner rather than later, you will have your van, your freedom and Dreams coming true.

Thank you.......I can't wait!

 

[Cheli]

Fast forward to present day...I am debt free and am saving significantly each month (I work a full and part time job) to be able to buy a van, class B or C hopefully by year end so I can attend the RTR in January.    I really need to decide what rig I want... :s

Awesome job!  I am hoping to attend RTR in January as well, hope to see  you there.

 

[SoulRaven]

The only people who need credit are those who are in debt, or want to be in debt in the future.  Good on you Cheli and TJaybird.  

I don't want to hear arguments for going into debt because insurance companies and employment depend on your credit score and not your credit REPORT.  Find a better insurance company and ask yourself if you would even want to work for a company who decides YOUR value on a silly number indicating only your ability to stay in debt and be a good little  slave.

I'm curious if you've managed to find an insurance company that does not use credit score as a factor in their premiums? If you've found one, I'd love to know who they are. All of the ones I spoke with use credit score in determining rates, and my understanding is that's standard here in the U.S.. If you know of one that doesn't that would be incredibly beneficial info to those who wish to avoid playing the credit score game.

I both earn and save money by playing the stupid silly credit card game, which is my primary motivation to do it. I posted one example here. I avoid getting any cards that have an annual fee and I do not pay interest. I coordinate the new card bonuses (e.g. $100 bonus to spend $500 in the first three months) with necessary big ticket purchases such as a year's worth of auto insurance at once, which purchasing in one lump sum gives a discount, and then earns me money as well. Free Shoprunner (2-day shipping) and extended warranty on items purchased through my credit card--including theft protection of said items--are additional perks that make it a no-brainer decision for me personally.

All that is in addition to the cash-back perks, which may be negligible but do add up over time if you're spending it on purchases you already need. As much as 5% cash back. And, the better your score, the better offers are open to you. $500 bonuses just for getting a card and using it a few times do happen. Easy money, IMO!

Finally, SSI doesn't let me save. If ever my total accounts go over $2000, income ceases until they are back under. I can technically save in cash under the table, but about 95% of transactions occur online for me, plus making a deposit doesn't work because then they want a paper trail for how I came across that money. (Saying it was a gift is no help--they will decrease my income by the exact amount of the gift.) So credit is also used as savings to me, and if I'm having very lean times then I buckle down to pay it off, always making the majority of purchases on a no-interest card in case I have more unexpected emergencies than the card can handle. This is something I absolutely detest about SSI and one reason I'm trying so hard to get off it--I want the freedom to save up an emergency fund, dammit!

I understand those who wish to opt out of the silly game entirely, but I strongly disagree that being in debt is the only reason for having a credit card. For me there are a multitude of benefits that very much outweigh the hassle involved. But, to each their own.

 

[ggwoman]

I'm curious if you've managed to find an insurance company that does not use credit score as a factor in their premiums? If you've found one, I'd love to know who they are. All of the ones I spoke with use credit score in determining rates, and my understanding is that's standard here in the U.S.. If you know of one that doesn't that would be incredibly beneficial info to those who wish to avoid playing the credit score game.

I both earn and save money by playing the stupid silly credit card game, which is my primary motivation to do it. I posted one example here. I avoid getting any cards that have an annual fee and I do not pay interest. I coordinate the new card bonuses (e.g. $100 bonus to spend $500 in the first three months) with necessary big ticket purchases such as a year's worth of auto insurance at once, which purchasing in one lump sum gives a discount, and then earns me money as well. Free Shoprunner (2-day shipping) and extended warranty on items purchased through my credit card--including theft protection of said items--are additional perks that make it a no-brainer decision for me personally.

All that is in addition to the cash-back perks, which may be negligible but do add up over time if you're spending it on purchases you already need. As much as 5% cash back. And, the better your score, the better offers are open to you. $500 bonuses just for getting a card and using it a few times do happen. Easy money, IMO!

Finally, SSI doesn't let me save. If ever my total accounts go over $2000, income ceases until they are back under. I can technically save in cash under the table, but about 95% of transactions occur online for me, plus making a deposit doesn't work because then they want a paper trail for how I came across that money. (Saying it was a gift is no help--they will decrease my income by the exact amount of the gift.) So credit is also used as savings to me, and if I'm having very lean times then I buckle down to pay it off, always making the majority of purchases on a no-interest card in case I have more unexpected emergencies than the card can handle. This is something I absolutely detest about SSI and one reason I'm trying so hard to get off it--I want the freedom to save up an emergency fund, dammit!

I understand those who wish to opt out of the silly game entirely, but I strongly disagree that being in debt is the only reason for having a credit card. For me there are a multitude of benefits that very much outweigh the hassle involved. But, to each their own.

Bitty, I didn't know SSI has such control over one's ability to save. (another way the system keeps people poorer than they should be.) I'm glad you find the perks in the credit industry and are willing to undergo the hassles to use said perks, but I don't know anyone who ever got rich that way.

As far as insurance, HI, CA and MA can't use your credit score. It's been banned. For the other 47 states, Geico uses credit scores the least of all insurance companies and that is who I am with and have been since 1997. When I got an insurance quote recently for a probable SD address from Geico, I was happy to see that it would cost me $400 less per year than I pay now. The TT takes the place of my Geo, but only costs a ridiculous low price of 25 bucks.