Credit Cards

[TomFraser]

I'm 18 years old, still in high school, and when I first turned 18 I got a Bank of America secured credit card. (Give them 99 dollars, get a 500 dollar credit limit). I've been using it up to 400 dollars each month, and paying it off 100 percent each month. All this is in order to build credit. My score is 726, but with little credit history the score means nothing.

I've gotten a letter saying they are going to refund my 99 dollars, and upgrade me to a 2500 dollar limit. I'll never hit that limit, but having a high limit is supposedly good for your credit score.

Before I do that (which I will), I want to know what types of credit cards everyone here has? I'm looking for a card that gives cashback on gas and groceries mainly. I'll simply use it for those things and pay it off each month. I also want to continue to build credit, which is the main reason I got the cards in the first place. I don't use them because I don't have money, I use them just to build credit. I only put gas, insurance, and groceries on it.

So what types of cards do you guys have (if any) and what benefits/rewards do they come with, I'm shopping around

 

[7Matt-GE]

right now you dont even have a credit score. basically what you wanna do is buy something small with it (like a pen) pay it off immediately and never use your credit card again to establish credit. its the easiest way to establish credit. credit cards as good as they sound are NEVER a good thing unless used for an emergency. personally if it was me i would hide that thing from myself. thats my imput

as for credit cards i own a wells fargo credit card.

 

[TomFraser]

A good credit score is built by actually using the credit card... and what is the difference with paying with credit and then writing a check in 20 days, versus just writing the check.

According to all the credit bureaus 30 percent of your credit limit should be used each month, then promptly paid off to successfully build credit.

I don't want to live my life without credit, when I go to buy a house (actually I plan on building my own one day) I want to be able to get a mortgage.

Credit cards seem to be a great thing once you can get a good one. Who doesn't want 5 percent back for all their gas purchases? Who doesn't want buyer protection programs such as doubling warranties, instant mail in rebate money back and others?

The credit cards are not the problem, it's the people using them, and I'm not one of those people.

 

[7Matt-GE]

oh the idea of credit cards are good but in reality they can be bad...i was like you when i got my first credit card..but then once you use it..it starts to become a different story lol. credit cards alone wont build your credit enough to get a house...hell ive had a credit card for years and they still deny me a car loan (high 7's) and i make enough money to live comfortably.

 

[x10secondzx2]

I refuse to get a credit card now. I had a best buy one for a bit but paid that off an haven't used it in about a year. I have a car loan and that's it. My credit score is plenty good with just the car loan. My goal is to pay that off in the next year then I'll be debt free. I want to pay for everything from then on with MY money. No more borrowing for me.

That being said I liked my best buy card. Intrest free for 18months gives you plenty of time to pay off a TV or computer.

 

[7Matt-GE]

I refuse to get a credit card now. I had a best buy one for a bit but paid that off an haven't used it in about a year. I have a car loan and that's it. My credit score is plenty good with just the car loan. My goal is to pay that off in the next year then I'll be debt free. I want to pay for everything from then on with MY money. No more borrowing for me.

That being said I liked my best buy card. Intrest free for 18months gives you plenty of time to pay off a TV or computer.

exactly, live within your means. im learning that the hard way too.. (50K student loan ARGHH and credit debt!)

 

[kelson]

I just use a debit card so the money comes right out of my account. then I never have to worry about paying anything off since I can't spend more money then I have.

 

[92nsx]

To build good credit you also have to keep some sort of balance to show money management, or some thing like that. When I talked to my parents financial adviser, about 10 years ago when I was your age going off the college, he told me to keep some sort of a balance, and not to pay it off 100% every month. I had the same idea as you do to pay if off 100% every month. He said for "instance" charge $100 when the bill comes pay $75-80 or close to just so there is revolving a balance. The accrued interest on $20-25 isn't to much and helps build credit faster.

Hope this helps

 

[Poodles]

Considering the banks can fuck your rates at will now, there is NO WAY I'd get a credit card. If I can't pay for it, I don't buy it.

If you want to build credit, finance a car with a co-signer. As they can't change your rate (you can refinance later to get a lower rate) you won't get screwed the same way.

 

[TomFraser]

If you want to build credit, finance a car with a co-signer. As they can't change your rate (you can refinance later to get a lower rate) you won't get screwed the same way.

That is what I want to stay away from... I will probabbly never own a new car (unless i'm realtively wealthy) as I never want to have to pay a bill each month for the thing.

I just got my college info, I belive I'll be going to UMASS Lowell, as I have about 15000 in scholarships there, and it costs about 20000 after room/board and other expenses. I cannot turn down college for that cheap. So I will have college loans for about 5k each year (and paid off each year, I make enough to easily afford that).

 

[Poodles]

Doesn't have to be a new car

 

[mkiiSupraMan18]

I've got an American express and I get 3% back on gas/groceries... and 1% on everything else. My wife and I use them for EVERYTHING that we buy and then pay it off every month.

We do it because #1, we know where our money is going (look over monthly statements which are itemized by category (gas, groceries, electronics, education, utilities, etc)) and we don't need to keep receipts for anything. Plus a few months ago we got a check from American Express for allowing them to let us borrow their money that we paid right back that was just shy of $400. Not bad for them making $0 off of us. lol

That's my uneducated experience...

 

[TomFraser]

I've got an American express and I get 3% back on gas/groceries... and 1% on everything else. My wife and I use them for EVERYTHING that we buy and then pay it off every month.

We do it because #1, we know where our money is going (look over monthly statements which are itemized by category (gas, groceries, electronics, education, utilities, etc)) and we don't need to keep receipts for anything. Plus a few months ago we got a check from American Express for allowing them to let us borrow their money that we paid right back that was just shy of $400. Not bad for them making $0 off of us. lol

That's my uneducated experience...

Specifically, what card do you have from them?

Any anual fee?

 

[iwannadie]

I won't go into why or why not credit cards are bad but I will share a positive experience I had.

I've had my amex Blue card for years now and like it because if something goes bad I can call amex and they take care of it. A situation in particular though involved Uhaul(a franchise not corp run). The uhaul place was charging me more that 4 times what I should have actually paid, I called amex and they put a hold on the charge immediately. I called corporate uhaul many times and got no where with them since the place I went to was a franchise they didn't seem to care. I got a call from amex and they asked what I thought I should pay and said it's a done deal the over charge will be taken away. They didn't eat the lose on that either, they pressured uhaul into refunding the money and I got a call from corp apologizing for their mistake.

Also, when I buy stuff online I like that security in using the amex card now. For the record, I don't charge anything I can't cover with cash and I also keep a revolving line a credit. I never pay off my bill 100% as -they- don't like see that, you need to show money management as mentioned.

 

[TomFraser]

I'm liking amex blue... I'm going to wait six months and apply for it.

 

[RockPaperSwoRD]

get a job at costco, they approve you for amex blue after your 90 day probation. they also pay decent $$

 

[Dunckel]

There are other ways of building your credit, without getting a credit card. Establish a lengthy residency. Don't move every couple years. It tells whoever is going to loan you money, that you may be hard to track down, and it becomes more of a liability for them. Keep a checking account, and a savings account. Start paying - if you don't already - for your own car insurance, and cell phone bill. You're 18. You have time to build your credit. And that's what it takes. Time.

Just because they are willing to up your credit, doesn't mean it's a good idea to accept it. My credit is good enough, I can walk into a jewelry store with $0 down, and walk away with whatever I want. (And my ex knew it LOL). Though, I don't go in there every couple months and charge away in order to keep my credit in good standing.

 

[Zumtizzle]

^To add to that. Utilities under your name helps a bit too.

Look into "savings builder loans". The bank charges you 11% APR and has a savings account you build while also building your credit.

 

[Supracentral]

Read:

Dave Ramsey - The Total Money Makeover.

-and-

Tom Stanley & William Danko - The Millionaire Next Door.

Try to buy used copies.

You might decide (as Theresa and I have) that the credit card companies can go fuck themselves. :3d_frown:

One of the first steps of financial independence is to not owe people money... You don't need credit. You can disagree on that if you wish, but it's a statement I've found to be 100% true...

 

[jugodegolf]

My grandfather practiced getting a 3% discount for early payment while most business pay within 30 days. So if you purchased 100k of carpet, lumbar, concrete..etc he would save 3k for writing the check early. In our industry the common practice is for the casino to hold our money-tips till the pay period payday. The keep the interest earned. Similiar to the gov collecting taxes year long and then giving you a refund in the early part of next year.

Question would be to take a look at how much easier is it to use cash vs. credit or debit card. Total spending on credit cards was a combined total of 41 billion (combined rev's of AXP,COF,DFS,MA,V)? It's about habits? How hard is it to use cash? If I recall correctly for every visa transaction the vendor pays 3% to visa. Im pretty sure paypal works the same way.

Also on another note. I recently paid a trip to bama and noticed a proliferation of cash now sites. Folks these people survive and flourish on ignorant people.

If you are smart and don't ever get caught in the trap you can use the credit cards and build up the rewards