Building Credit...

[rebelcowboysnb]

The only thing you should ever barrow money for is a house. Everything else should be cash. Credit is a killer no matter how well you think you can handle it. I barrow enough every now an then to buy a car I could have payed cash for an have payments last a year to keep my credit score up but never buy anything above what I could pay cash for it.

 

[GarlicEater]

Quote:
I agree X 10,000!!!

I started out building mine with gas station cards paying off my student loans and worked up from there, however, I lost it all and my good credit in 2007 when the economy started crashing. We're entering times where "credit" going to be something that either evil to acquire, kinda like having a rattlesnake bite you for "luck", or some combination of you simply can't get it, and the stuff you do doesn't require it anyway.

Read up on the history of credit cards, it's actually quite interesting. They didn't get popular until the 1970s! They didn't come into existence until the 50s, were ralatively rare through the 60s, and so on. The WWII generation had lived through the 1930s Depression and had no use for 'em. Now we're entering a new Depression and frugal is going to very "in". Pay as you go, if you don't have it, don't buy it. etc.

I always thought a credit card was just about essential if you travel, but riding my (250cc!) motorcycle cross-country in 08, I found that paying cash at hotels worked just fine.

 

[Dunkopf]

We stopped at a motel in a small town in KS at about 2am after crossing the white line asleep a few times. We went in the office and they had a box with keys and a cigar box to put money in. Got up in the morning and left keys and a 20 in the box as requested and left. Self service motel at it's finest. It was a little creepy though because it was about 2 miles off the interstate. Kind of like a horror movie.

Yep, cash works for most anything. I cut up all our credit cards. Not that they worked anymore anyway. Just wanted to make sure that as they went down I wouldn't use them again. I got in the mess by trying to use them to pay bills with the intention of paying off each month. Somehow the money got spent elsewhere. Now it's the nose to the grindstone.

 

[crossgirl]

I think Laurajean gets it. I think having a good credit rating is extremely important. Employers, landlords, all types of persons run credit checks to help them gauge character. Having a good credit score makes you appear to be a stable, trustworthy person. Fair? No. Happens every single day? Yes. Having a safety net is also important. I sleep well at night knowing should something catastrophic happen, ie: car repairs, major appliance failure, out of state funeral, whatever, I have a means to take care of the issue immediately and then pay it off. Everyone is right to not run up the cards. The banks are in the business of making money, they are not your friends. As everyone else said, paying off your loans should be your very first step in building credit.

 

[domino7]

I would generally agree that credit cards are bad, but they are nice to have if you are disiplined. You need one if you ever want to rent a car, for example.

Learn to live within your means, and pay ALL your bills on time. Don't worry about your credit score.

 

[Rammy]

Credit card for emergencies? Thats what a good savings account is for. If now, for any reason, I lost my job or things got tough, I have a substantial savings account for emergencies. Plastic might be forever, but cash is king. I swore after I got my cards paid off<no thanks to the ex> that I would never be in that situation again, not having money to even buy food. Living with the stress of the companies harrassing you for the money. Never again. Now I put half of my check in the bank, I budget, and I dont buy anything unless, as I stated in a previous post, after three days, I still really need it. I also only take cash to the grocery store because taking plastic, you tend to over spend. When you take cash, your limited to that and you make smarter choices. I am currently working on becoming a extreme couponer. Its my new mission in life.

Please dont do the card. You will regret it.


Rammy

 

[TriciaHowe]

Please go to DaveRamsey.com He is excellent with his advice and will keep you out of debt. You DO NOT want a CC.

 

[c is 4 cochin]

Please, please listen to the folks who say don’t get started with credit cards. It’s a lie that one needs credit. The idea that people need credit came from those credit card companies. There is a proverb that says “a borrower is a slave to the lender”. It is true, the only people who benefit from those rotten pieces of plastic are the credit card companies and banks.

Don’t ever count on “always” being able to pay them off on time. You cannot predict what will happen tomorrow or the next month, or year from now. You could suddenly lose your income though no fault of your own. If you lose your job and then have a difficult time getting another one, credit card companies will not stop the interest from accruing. As a matter of fact, they triple the rate you will owe them if you miss a payment or even if your one day late.

Why would they want you to pay off cards? YOU are making them money ! If you pay off cards on time, they make less money on you, but you are still earning them money. At no charge or loss to them. You are their slave

 

[booker81]

Credit score isn't solely tied to credit cards.

I'm with Rammy - emergency money is in savings. Most logo-ed debit cards can be used for hotels, rentals, etc.

The only "credit" I run right now is a vehicle loan, which I have directly withdrawn the same day I have direct deposit. No stress, no thinking, it's paid, and for fools like me who can't keep track of anything, I know it's paid on time, all the time. Just doing that is raising my credit score quietly and easily. I could pay it off right now, but I would like to raise my score from the mess my ex left me. Unfortunately many places do depend on your score - car insurance etc - but once that's set up, then I'll just go back to paying bills and letting that show my payment history. I've got some time before I can get everything paid up (shelling out about $25,000+ instead of bankruptcy), but I should be quite solvent at the end, with good history. Goal is to pay off that amount in about 2-3 years or less, which I can do now. I couldn't do it before, which now leaves me with a court order and garnishments and crap (still researching if I can sue my ex). Once I finally made enough I could actually afford to start paying off the debt, they released all of the garnishments and I have an automatic payment sent. If one is dealing with horrible debt issues and whatnot, once you have income, it's a lot easier to call up and say, "I'll give you X a month, and Y down right now." and call you own plan and amount.

I had close to 800 credit when I met my ex, with no credit card, just a series of car loans and paid bills. Didn't listen to daddy's best advice - "Always get a complete financial report before marrying someone." Left the marriage in a year with a score in the mid 500s, and I've been in there since. Good job now, and things are changing, so goal to get in the 700s again by this time next year. With no credit cards.

 

[Dunkopf]

My 19 year old is in college and has his mail sent home still. My 23 year old is on an internship in DC and does the same thing. Whenever a CC application comes in the mail for them, it goes straight in the shredder. I hope they stay off that merry go round. It's a very expensive way to test your fiscal discipline.