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121 Comments
- GregLoire, on 10/29/2009, -2/+33Here's a little tricked I discovered that you can do with credit cards to keep them free and actually end up COSTING the credit card companies money in overhead.
Pay off your full balance each month. 100% legal, I swear. - pinkpackrat, on 10/29/2009, -0/+25not like the credit card companies are interested in an honest business transaction or anything-- makes me sick. I wish we could all just stop using credit cards
- OnipSemaj, on 10/29/2009, -1/+21***** Chase. Get this: I had a Circuit City card that converted to a Best Buy card (it's all Chase) which I paid off and closed many months ago. For some reason I still had a $14 balance (left over interest?) I swear they just totally made up. So I paid that and I STILL had a $1 balance - I can't seem to pay the ***** off. They want me to keep some kind of balance as long as possible. The latest statement says my interest rate is 148.99%.
I...hate...Chase. - blindhammer, on 10/29/2009, -0/+19You're all wrong. Clearly, the best way to avoid problems with credit cards is to become a CEO of a large bank.
- DiggRage, on 10/29/2009, -1/+18Well, they are starting to charge fees for that too (look up "credit card deadbeat"). Also, they get a percentage of every transaction from the merchant, so you are indirectly giving them money anyway in the form of higher prices.
- reeds1999, on 10/29/2009, -0/+171. Re-instate Usury laws.
2. Cap fees. - johndk, on 10/29/2009, -0/+14I've said it before and I'll say it again, we should have let these 'too big to fail banks' fail. As it is they get free money from the government (our money) and loan it back to us at ridiculously high rates. On top of that they don't have to worry about us taking our business elsewhere because even if they end up losing money the government will be there to bail them out.
- pinkpackrat, on 10/29/2009, -0/+11 Personally, I'm pretty careful. What about people who are paying off medical bills or are out of work and who suddenly find their interest rate doubled for no good reason-- it is stupid and it is not a good business model. The credit card companies will lose in the long run if they squeeze people too hard. It's not good to kill the goose that lays the golden eggs
- amorok, on 10/29/2009, -1/+11Isn't a credit card useful in order to maintain a good credit history for more important loans?
- blindhammer, on 10/29/2009, -1/+10In order to build up credit.
- BeatsNWaffles, on 10/29/2009, -3/+11People who state this by default put a neon sign over their heads saying that they're not financially responsible.
- ace00000, on 10/29/2009, -1/+9These greed infused wall street banks are seriously whats wrong with this country. What happen to the days when banks used to be honest?
- pktgumby, on 10/29/2009, -0/+8"There's nothing (responsible) you can't do with a debit card that you can do with a credit card these days."
You mean those ones with the Visa and Mastercard logos on them? - PhairOh, on 10/29/2009, -1/+9If you don't want to use credit cards, simply stop using them. It's that simple and then you never have to deal with the fine print ever again.
- Azuroth, on 10/29/2009, -0/+7You do realize they get anywhere from 1.5-3% of your transaction costs from the merchants in fees right?
- nepidae, on 10/29/2009, -4/+111) Don't spend money you don't have
2) Don't spend money you don't have
3) Don't spend money you don't have
4) Don't spend money you don't have
5) Don't spend money you don't have - Pyros7, on 10/29/2009, -0/+7WTF is wrong with you people? Sure lots of people spend money they don't have...that's bad...yadda yadda yadda. That's been going on for decades, the credit card companies write it off as a loss...your credit sucks, big deal.
But millions of these people recently had great jobs and had no problem making some monthly payments on big purchases they understood would cost them more over time. Oh *****! Recession! Your job is now in India! You can't make those payments anymore, and since you missed a payment instead of owing us $200 a month that you can't pay, you now owe use $350 that you can't pay!!
Or maybe it was "Oh *****! I lost my job! The gas company is going to turn off my heat! Maybe I should pay them with the 'ol credit card until I can sell the place or get a new job!" Oh ***** housing market crash! My house is worth less than I agreed to pay for it 5 years ago! ***** ***** *****. So I put that bill on the CC but I guess I won't be able to pay them off when I sell the place like I meant to.
I'm sick of all these high and mighty "I paid for my first house at 25 with $200,000 cash I saved from delivering milk bottles since I was 13. Not everyone in debt trouble is retarded, some people are just ***** out of luck and when their debt (which was reasonable) started skyrocketing (because banks can change the terms of your debt whenever they freakin' like) there was nothing they could do because these banks made the same assumption their customers did...that if they were making good money they'd continue making good money forever. - borez, on 10/29/2009, -0/+6For now, that's about to change.
- LinuxLiberty, on 10/29/2009, -0/+6Going into to debt is a bad idea in general but it is a terrible idea with credit cards because, unlike other loans, the credit card company can constantly change the terms and the interest of the loan for virtually any reason.
- wilowisp, on 10/29/2009, -1/+6I use credit cards for my online purchases - I would never use my debit card for e-shopping. I'm using my credit card not because I can't afford what I'm purchasing, but because it offers more protection from identity theft. If managed correctly, credit cards have their uses, even if you pay them off in full each month.
- darkstar949, on 10/29/2009, -0/+5Just send them more than what the balance should be and they should send you a check in the mail (6 to 8 weeks) with the overpayment if the account is closed.
- cam0man, on 10/29/2009, -8/+13Anyone who doesn't use credit cards is an irresponsible idiot. You can't control your spending then address that issue instead of blaming someone else.
Keep it up though, leave the benefits for the rest of us. I lost my iPhone at the Rhino in Vegas, called up Amex and they credited me the $200+tax within 15 hours. I just flew to Boston from San Jose twice for free because my CC's gave me free flights. I've never paid a penny in interest. I used the balances of my credit cards to fund Citi accounts to get hundreds of dollars in free rewards in a matter of hours.
If you aren't using a credit card to get the benefits, you're paying the idiot tax. I love when people blame credit cards, it's your own damn fault, be an adult and take care of yourself. If you're one of the people bitching about credit card companies 'ripping you off' you're probably also fat, watch 20 hours of TV a week, and are clueless about how to handle your life. Hilarious...just makes it easier for those with a brain in their heads to succeed. - Lith25, on 10/29/2009, -7/+11They feed off of idiots. It's pretty simple actually; if you don't have the money to buy something don't just stick it on your credit card and hope it works itself out.
- blindhammer, on 10/29/2009, -0/+4Link to being charged for good credit:
http://wcbstv.com/consumer/credit.card.fees.2.1272 ... - RickGonja, on 10/29/2009, -0/+4Good advice if someone can do it, but I still think they make some money off the retailers from fees. Do the fees offset not carrying a balance. They probably do but they would rather get more money from you in interest.
- ronintetsuro, on 10/29/2009, -8/+12#1 pitfall to avoid: Owning a credit card.
- faceless323, on 10/29/2009, -0/+4Damn 148.99%
- whorunbartertwn, on 10/29/2009, -1/+5Harsh delivery but score one for knowing that using this personal finance tool (a credit card) can be a reasonable part of a fiscally responsible lifestyle.
I'm astounded at how many advise that the way to deal with something that needn't cost anything and can provide tangible benefit is to completely avoid it. - MissCellania, on 10/29/2009, -1/+5My Citibank card is going from 16% interest to 29.99% interest next month. Outrageous. It won't make a difference for me, because I use it as a charge card and pay off the balance every month, but I can see this causing real problem for a lot of other people.
- Vector713, on 10/29/2009, -2/+6As much of an ***** as you're being, I hate to admit you make a great point. Dugg.
- HyperionHK, on 10/29/2009, -1/+5I use my credit card all the time, and I pay it off every month. It builds credit, and I like having almost all my purchases consolidated into one place.
Plus I put a lot of business expenses on my card, so for that, CC is my only choice anyway.
Not to mention using my debit card costs me money (I only get like 10 or 20 transactions a month), using my CC doesn't - bacon_skoda, on 10/29/2009, -0/+3however, the higher prices is spread amongs everyone with or without credit card.
the business owners are not allowed to charge separate amounts for cash vs credit.
(although stores in Chinatown do that all the time!!) - masterstghm, on 10/29/2009, -1/+4Credit cards offer rewards, they are safer than cash, check, and debit, and they are very convenient. Plus, if you need extra money for some reason it's there.
- RickGonja, on 10/29/2009, -0/+3But they don't give extra money to the poor credit card company by paying off their bills each month. They are abusing those nice people at CitiBankOfCorpAmeriCapitolGroup.
s - PhairOh, on 10/29/2009, -1/+4Credit Cards are not scams. They are tools and when used properly they are extremely powerful. Like most other tools, if used improperly they can also be incredibly dangerous.
- Dauntless1, on 10/29/2009, -0/+3@phairoh
Wrong. Ten years ago, maybe.
But then we had a president, you might remember him occasionally, who said americans shouldn't be rewarding for doing what they should be doing anyway, and then turned the other cheek while utility bills, most forms of rent that are not a mortgage, cable bills, phone bills, ect. were no longer allowed to post a positive score on your credit. However, they can still post a negative. Isn't that special.
Today there are other ways to build credit such as credit starter CDs and such from your local bank, but those are massively more slow than credit cards for building credit. Gee, I wonder why a higher level of credit is built faster with the items most likely to get americans into debt? - whorunbartertwn, on 10/29/2009, -1/+4I use a credit card for almost everything and we're in the same situation, if I don't have the money I don't buy it. I'm completely debt free, pay no annual fees and certainly don't pay interest on my credit card.
Congratulations on your financial discipline and obvious wisdom regarding personal credit, but credit cards aren't themselves an indicator of poor financial planning. - dae3dae3, on 10/29/2009, -0/+3Did you know that people who use credit cards spend about 12 to 18% more than people that pay cash? Are your "rewards" more than 12%?
It is psychologically much easier to spend more with a credit card than with cash. It is painful to hand cash to somebody. If you are giving somebody money out of your wallet it is much harder to go over your budget or get talked into an extra that you didn't really plan on.
While you may think you don't spend more with your "rewards" cards I can almost guarantee you that you are spending more with the card than what your "reward" gives you. Getting a 5% "reward" doesn't do you much good if you spent 10% more to get it.
P.S. People in glass houses shouldn't throw stones. You've been sucked into the credit card culture just like the people you are calling names. Not only that but you've been convinced by the credit card marketing departments that you're screwing them over while you are doing exactly what they want you to do. You may not have a credit card balance at the end of the month but your savings account is less than it would have been if you didn't use the card. I assume you think that human nature doesn't apply to you and that you are disciplined enough to not spend more but if so you are a VERY unusual person. - dae3dae3, on 10/29/2009, -0/+3You can buy a house without a credit card history. You just can't get a 5 minute approval. On something like a home mortgage they will go through the manual underwriting process. If you have 20% down, are buying a house where the payment is 25% or less of your monthly salary, and a good job history you will have no problem getting a mortgage. It will just take a week or two longer.
- d3dm, on 10/29/2009, -0/+2What you don't get with a debit card are rewards for using the card.
- cam0man, on 10/29/2009, -0/+2If you were aware that people typically spend 12% more when using a CC over cash, wouldn't you be more conscious about making sure you stick to your planned purchases and a budget? I use my online statement to make sure I'm sticking to my budget. What gets measured gets manager. Having a list online breaking down how I'm spending all my money and be able to analyze that data over months is much more handy than wondering how much cash I spent, change I lost, etc. How do you think fiscally sound companies manage their money? with envelopes of cash? Or how do accountant manage finances? They hold themselves accountable my logging all the data carefully and understanding basic debiting and crediting. Yes, it's easy for people to spend more than they expect with a credit card, but don't you think that once you've become aware of this you'll be able to address this?
I replied to the person below me as well and explained this in more detail. I spend $400+ a month on gas, I put it all on my CC...same for purchases like groceries which I spend the same amount on every month or my cell phone bill/insurance bills/etc.
Furthermore, Amex gives you awesome tools online to chart out how much you spend on different types of purchases, it makes it EASIER to keep track of your expenses. - AnalogAssassin, on 10/29/2009, -0/+2Why are people digging this down? For most people, credit cards are bad. Put it this way: Keeping a running balance on a credit card is bad. If you HAVE to use it, don't run up more than you can pay off at the end of the month.
- ccallana, on 10/29/2009, -0/+2"When their debt (which was reasonable)...." - there's the fallacy right there! Debt is not reasonable. (it can be argued that *some* debt might be reasonable, but that's for a different thread). If you don't have enough cash on hand to pay your bills for several months without a job, then you have too many bills and not enough cash. If you lose your job, keep your $200/month cable bill and then put it on credit cards because you don't have the cash to pay for it, that's irresponsible. Get an emergency fund so you can deal with those "unexpected" events - that aren't really unexpected by they way.. studies show 70% of people will have a major negative financial event in any given 10 year period...
That being said - the credit card companies jacking rates around is rude and disgusting and shameful. If you've been a good customer, they shouldn't be screwing with you.... "Customer Service"! oxymoron.... - ccallana, on 10/29/2009, -0/+2What you say is true - *if* you are *only* buying things you would any way. Problem is, for most people, they will start buying stuff they really didn't need, or wouldn't buy otherwise because its on credit... (even if they know they are going to pay it off @ the end of the month). Studies have proven it, and credit card companies spend billions to make sure you spend more... it's their job.
You get the exact same guarantees on purchases with a debit card used like a credit card as you do with an actual credit card... exactly the same.
And you can buy a house without a credit history with a good lender who will do the extra work instead of being lazy and just looking up your fico score. - ccallana, on 10/29/2009, -0/+2If you have a good history of paying your bills, there is no reason you can't get good treatment for any service. You don't need "good" credit to buy a house or a car - you just need a better lender. Lazy lenders only look at your credit score. A good lender will be willing to manually underwrite any home or car loan you decide to take (although you should pay cash for your car anyhow...)
- inactive, on 10/29/2009, -0/+2yeah that or students who can't get enough regular loans. But hey thanks Capitan myopic.
- masterstghm, on 10/29/2009, -0/+2I'm pretty sure lower credit limits are a good thing for people who can't afford to pay them off.
- designerutah, on 10/29/2009, -0/+2It's called an interchange fee, and the merchant agrees to pay it when they sign on to the Visa, MC, or Amex Associations. It's typically 2-4 percent, and basically comes off the profit the merchant makes on the item being sold, but, the merchant gets their money now, rather than in 5-10 days with a check, and doesn't risk the check bouncing fee. There are benefits for using credit cards, just like any other form of payment... you just have to know the pitfalls and avoid them.
- GregLoire, on 10/29/2009, -2/+4Rewards, and not having to pay it off for a month, even if you plan to pay it off in full once you get a chance.
- DiggRage, on 10/30/2009, -0/+2That is true, I think both the customers and the merchants are trapped in this racket.
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