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Yup, I plan to teach my little girl all about building good credit and not spending more than her means. Won't be easy but I'll do my best. But building up good credit at a young age can't be a bad thing unless she blows it all on barbie.Quote:
Originally Posted by Opaque
not that it matters now, but at some point, you're going to have to get over this. if you have large balances in the future at some point, and an 0% apr card for say a year, it's actually the wrong move to pay that off in full immediately because you can take that money and earn whatever the market offers you...usually at least 4-5% in a conservative money market and a lot more if you get fancier.Quote:
Originally Posted by Nomi
i have a shitload of federal school loan debt, but at a low <3% rate. it would be flat out stupid of me to pay that loan down now because i can easily earn more than that on the open market.
point is, don't be irrationally afraid of debt. it's a good practice when you are young and have no business hauling around frivolous debt, but sometimes it's necessary and even good. you may need to go to grad school to maximize your earning potential and you may need to take out what could amount to "frightening" loans to do so but that doesn't mean it's the wrong move.
this is where your assumption is terribly wrong.Quote:
Originally Posted by kingoffighters
My bank accounts are pretty... not good. I have a standard checking without any rewards, but no overdraft charges (2 or 3 freebies a year, I've only overdrafted once) and a savings account with pretty horrible interest (2%?). Right now I have NO extra money and about 2k that sits in savings unless I need it, I don't keep much in my checking account ($100 at a time or so). So yeah, I make some interest on the savings account, but it isn't shit. That money sticks around until I need to live off of it this summer, which is why I haven't bothered looking into other investment options. A short term CD would work I suppose, but shit comes up a lot, so I wouldn't like having my money somewhere else at this point. I'm in a stable situation where I won't ever need to put bills on my credit card, but I don't have much going for me investment-wise. Just my savings account and a $2k mutual fund my father set up for me as a child. Planning on leaving that there until after I graduate.Quote:
Originally Posted by Rich
Alright, so, TNL advice thus far: charge often and pay it off in full by the end of the month, so I don't accumulate any interest to pay. Stick to 1 or 2 cards. Don't be dumb.
So far, I've got all of those covered. This is nice to know that I've been doing it mostly right, I feel a lot better about them now. I just grew up knowing that my family was in massive debts so I always saw credit cards as the embodiment of evil, but still necessary for credit. I'm way too paranoid and uptight to go blow money at stores for shit I don't need so I think I'll be fine.
Thanks guys. It's nice having all this consolidated into one thread as opposed to the little exchanges from other Sound Off topics.
And Dyne, suck a dick. My credit and spending habits are so much better than ANY of my male friends. Psh, gender assumptions :P
My wife is amazingly frugal. I believe it is her personality since her sister is the complete opposite.Quote:
Originally Posted by Dyne
get this in at least a money market account STATQuote:
Originally Posted by Nomi
---
also, carrying big balances hurts your credit score when you are carrying them but to my knowledge once you pay them off/down it has no lasting negative effects (and may be a slight plus). late/missed payments however will follow you around for years.
This is a good point. Really, I'm just starting to learn about all of this. My parents were colossal fuckups and obviously had nothing positive to teach me other than scare tactics about debt. I have a federal unsubsidized loan, which will be at or less than $6k by graduation in 2-2.5 years, but I haven't made any payments on it. I acknowledge that grad school will be necessary but at this point I won't be going immediately after undergrad.Quote:
Originally Posted by burgundy
Loans scare the piss out of me, that's all I know. I've been really conservative about what I need to borrow and have gotten by so far on working shitty jobs a lot and keeping my scholarship intact. It's something I'll realistically need to get over as I realize debt is a necessary part of living in this country, haha.
I don't know shit about investing. This is money I will need 100% access to in early May. Is there any point moving it now? It's money I saved up from various jobs, and I'm saving it to live off of this summer when I'm in Columbus, so I can avoid putting rent and groceries on credit that I can't pay off. This is not 'free money' and I tend to transfer bits and pieces of it to and from savings on a monthly basis. I figured a savings account was the most flexible option for me right now.Quote:
get this in at least a money market account STAT
it will skip a generation. :devil:Quote:
Originally Posted by kingoffighters
You're missing one important thing: live within your means. if you can't afford it, don't buy it. I guess that might fall in the "Don't be dumb" part, but just thought I'd reiterate.Quote:
Originally Posted by Nomi
Quote:
Originally Posted by Dyne
Quote:
Originally Posted by Nomi
what is this MMA you speak of? i'm pretty much in the same situation (ie having a lot of money sitting in a low interest savings account GIVING the bank scads of cash off my money).Quote:
Originally Posted by burgundy
You want more cards than that. I recommend 3, and only really use 1. Your score and what loans you can get are determined by how many records you have, how long you've had them, and how much of the total credit you use (less is better), among other things.Quote:
Originally Posted by Nomi
goddamned potty mouth.Quote:
Originally Posted by Nomi
http://i32.tinypic.com/4g4r9c.png
This advice isn't very great right now since the Fed had lowered interest rates by ~2% in the last 6 months, but I recommend an online savings account at Citibank, ING or HSBC. They were giving over 5% interest last year and are still around 3.4-3.8% interest and, when connected to a checking account (which they have to be connected to an account anyway since you can only tansfer money online), offer pretty awesome risk-free investments.Quote:
Originally Posted by Nomi
Also, no reason to limit yourself to 1 or 2 credit cards. The more credit cards you have, the higher your credit line, the less of a percentage of credit your using, the more of a hardon the credit bureaus will have.
That's what I meant by don't be dumb, for sure. I own a 360 but it was agonizing for me to buy, and I had $150 off on it, only ever bought 2 games so far... I'm an uptight weenie when it comes to spending money even when I DO have it. There are things I probably should buy, but don't, simply because I like having the money there 'just in case' or something. Living within my means is one of the only criteria here I don't have any issues with.Quote:
Originally Posted by Type Ryan
I fucking love Nomi sometimes.Quote:
Originally Posted by Nomi
Like right now.
http://en.wikipedia.org/wiki/Money_market_mutual_fund
nomi - i guess maybe not if you need the full balance come may, but if you figure to be building savings after that, you should consider it.
dyne - i don't know what "a lot" of money means, but if you have more than a grand sitting in savings regularly you need to be doing something more with your money. at least a money market fund, if not something more aggressive.
I think having less cards is more of a sanity thing, personally. I remember I had alot of cards at one point and I got very paranoid about losing my wallet and someone charging up a storm with them. So I got rid of a few I never use (mostly those store ones like Macy, or whatever) and only put one or two in my wallet.
Me 2! :tu:Quote:
Originally Posted by Opaque
My dad suggested that with the 401k plans my company offers, I go with the more aggressive ones now, so I don't plan to put any money into a savings account. It either goes to my checking account, payments, or my 401k, at least that's my plan.
Also to Icarus about the retreating thing, I meant making these statements with simply the ignorance of your friends as proof.
again, why do people think that if this happens they are on the hook?Quote:
Originally Posted by kingoffighters
things to worry about if your wallet gets stolen:
- criminal knowing your name and address
- having access to your bank account
- possibly getting your SS# and stealing that identity
- not having money to get home
things not to worry about:
- people making unauthorized charges you won't have to pay for
also, you can have more than one card and not carry them around.
Yeah, I won't be doing any major investing right now, I'm trying to get through school without another loan at the moment. I've more or less been exiled from my family at this point and my only tie is that mutual fund my father set up for me, which is now in my name. I can cash it out whenever I want (my brother cashed his and spent it idiotically as soon as he his 18) but I have just left it there. I think I'll get the full paperwork on it and start actually reading up on low-risk investing at this point, since I can always transfer that money around, and I usually keep a backup of $800 at all times aside from my checking/immediate use savings.
Thanks burg, Rich, and co. I'm definitely considering better savings options for when that happens, it's just a matter of making it through this summer first. Come fall I'll see where I stand and make some decisions.
You are right about all the other stuff too. But you can't really control that unless you don't put any sort of ID card in your wallet. That's why I stop carrying all the extraneous CCs. I don't need to build up my credit by having an army of CCs.Quote:
Originally Posted by burgundy
And just because you don't have to pay for the unauthroized charges doesn't mean it is not a hassle.
I have so many credit cards I can make a deck out of them. The only debt I have are my dad's debt (never lending him my credit card again) and student loans. Awesome money management can be learned quickly when growing up broke.
LOL at the timing of this article.
holy shit.Quote:
Consumers have racked up more than $2.2 trillion in purchases and cash advances on major credit cards in just the last year.
My friends aren't ignorant. You're about 5 minutes old, live a comfortable middle class life, and have never been a drug addict. You don't know much about anything. I don't mean this in a shitty way, but it's amazing you would presume to know a lot about the world. I'm also not a some weary traveler, but understand that falling into a hole can happen to anyone with only a few bad decisions.Quote:
Originally Posted by Thief Silver
Fair enough, replace ignorant with making bad choices.
I've refused to drugs, and known what could be my weaknesses and avoided them. It's not like I haven't had the chances to make the same mistakes. So saying "You have never been a drug addict" is a terrible way to defend your stance.
I don't presume to know a lot, and no one said Credit cards can't be evil but a "Scam" based on your friend's bad decisions is a bit silly and foolish. And with basic research and common sense I have found out ways I want to handle my credit.
I would say though, the credit card business is unforgiving of your own mistakes though.
The reason I said drug addict is because if you've been an addict, you're intimately familiar with desperation and how things can go bad real fast.
Either way, it's good you've been able to stay safe and secure - just realize it can be very easy to fuck things up.
Dude, your friends are a bunch of fuckups. Stop making excuses on their behalf by calling credit companies a "scam."
I can see Icarusfall's point because I know a great deal of people who cannot manage credit card debt and it is ruining their lives, their relationships, and their mental well being. But the situation occurred because these people either have no financial education or chose not to pursue any financial education, not because they had a credit card. They were already consuming more than they brought in before they had access to credit. It was a matter of time before the shit hit the fan. No one put a gun to their head and forced them to incur more debt than they could handle, just as no one forced them to have a 0% or, in too many cases, a negative savings rate.
Otherwise, I'm with Burg 100%. Maintain a good credit score and you will have access to more capital. If you don't have access to capital in this life then you'd better hope everything goes absolutely right in your life financially. You don't have to use that credit but you should have access to it.
I charge everything to credit and pay if off immediately. I'm the worst kind of customer a credit card company could possibly have. I use their high limits to buy things like Macbook Pro's and then pay it off the next day once it registers on online banking. I have flawless credit and enough money in the bank to do this, though, because I've been extremely fortunate in the very basic sense of that word. I've never had an issue with money because I've always been good with it.
The solution to everything about credit cards is to just not buy things you can't afford and budget. Sit down with a calculator and figure out your cash flow (incoming cash and expenses, longterm goals) and go to work. It's really that simple. Also save a little bit (actually a lot if you can afford it) for a nest egg, too. You never know what's going to happen and having a nest egg to shelter you really helps you through rough times.
Not sure if this helps, but if you ever get two large debts, pay the minimum on one, and put forth all your effort into paying the other. otherwise it could take forever to pay off your balances.
If by worst kind of customer, you mean best kind of customer?Quote:
Originally Posted by Drewbacca
The credit card company just made ~$80 off of Apple for a single purchase.
Also if you ever have debt collectors after them, talk to them and claim you're going to claim bankruptcy. They get NOTHING if you declare bankruptcy, and they will try to make a deal with you.
You did. Worst chain ever.Quote:
Originally Posted by burgundy
This doesn't really matter. Unless the debts have different interest rates, then obviously pay the higher rate debt first.Quote:
Originally Posted by Zerohero
you already lost the credit game badlyQuote:
Originally Posted by Thief Silver
Every chain is the worst chain ever. A credit card is not the reason you are living paycheck to paycheck. A paycheck to paycheck job is the reason you are living paycheck to paycheck.Quote:
Originally Posted by ChaoofNee
I'm not trying to be a dick about this, btw. I just think people tend to blame credit cards for financial woes rather than the simple fact that they don't make enough money to meet real or perceived expenses.
I mean, I suppose people couldn't overspend, or wouldn't be as easily enticed, without credit cards, but there are also situations where people need more money that they have and they would be forced to go to loansharks or something extreme if they could not get it through legit channels.
I'm late to the party, but I'm standing w/Icarus on this one.
He's right that CC companies love credit cards b/c they are, essentially, crack cocaine for consumers. Are there responsible ppl who pay off the limit each month? Of course. They are (of course) the exception.
This is common sense. Take a look around these boards and look at how much shit and/or consumer crap TNL alone collects, from multiple next-gen systems to hoards of anime, to tons of A/V equipment. Dollars to donuts the majority of this stuff was bought on credit (minus Burg, Yosh, Biff and, of course, Morphix).
A friend worked for a major bank. The credit division w/in this multi-national had a huge (we're talking huge) annual party celebrating the fact that they now had over $1billion (w/a B) in consumer debt amongst their lendees. This was not car and home loans; credit cards only. The VP of the credit division was practically having an orgasm announcing the total. If you don't think CC companies love our spendthrift ways, you're kidding yourself.
On student loans:
One awesome thing about student loans is the low, low interest rates. Beware that some lenders who consolidate your outstanding student loans into one loan (and one payment - easy!) may penalize you for paying off early.
Anyways.
Personally, I'd like to hear what TNL thinks about car loans; I'm looking at getting my first new car after years of driving junkers and I'd like a little input on the pros/cons of:
1. Down payments
2. Buying brand new or a couple years used
3. Loan length (60 mo vs 36)
4. Leasing
Any advice is appreciated.
auto loans are a terrible idea for exactly every reason you cite against credit cards. you should not ever borrow to buy a depreciating asset...at some point you will be paying for a car that no longer has value, and in some cases, that you no longer own.
drive what you can afford. save up and do some research and you can usually come up with a nice used car.
He was smart enough never to be addicted to drugs.Quote:
Originally Posted by icarusfall
I'd say that puts him above your friends.
This is the key, though. It's a decision, not a fate. If I give you a knife you can either use it to prepare a meal or kill someone. If you make the life ruining choice that's your fault, not the tools.Quote:
Originally Posted by icarusfall
That's where your friends fall in. I understand they're close to you, and you probably want to blame anything but them, but it's they're own fault that they fucked up. It doesn't make them bad people, but it's still their own fucking faults.
Exactly. Stop generalizing. You're friends aren't the middle of the curve, they're at the goddamn left end.Quote:
Originally Posted by Opaque
Not everybody makes bad decisions with credit cards or drugs.
Dude, I know. Does that make credit card companies any less of a scam to put you in debt?Quote:
Originally Posted by Opaque
Have fun worrying about your credit score - there's no point in arguing with you guys that have bought in to this. Like I said, two different lives.
You're wrong.Quote:
Originally Posted by Rhydant
I'm done.
LOL YES, IT DOES.Quote:
Originally Posted by icarusfall
That's all I wanted to add to that.
HELLO WHITE PEOPLE
The biggest problem is that when you go into debt, the credit card company has ways to cut their losses they can get away and break even or lose a little bit, while the only way you can cut your losses is declare bankruptcy which ruins your life. However as I said there are things you can do, Burgundy my point was that if you DO end up in debt, there are ways to solve it.
Making a deal with the debt collectors is something you can do, because as I said, the bankruptcy card means they lose money, and they'd rather get half of the debt paid than get nothing.
Does bankruptcy really ruin your life, or just your CREDIT RATING?
Have fun worrying about heroin.Quote:
Originally Posted by icarusfall
Of course, if there's no point in discussing credit cards, maybe you should have scrolled past the thread about credit cards.
Doesn't seem to bother Donald Trump.
My heroin dealer takes credit cards.Quote:
Originally Posted by burgundy
Another resource you guys should use is www.annualcreditreport.com.
It allows you to obtain a free credit report from the three major credit reporting agencies. You can use it to examine your credit history and check to see if there are any inaccuracies that could affect your credit score.
I was under the impression that filing for bankruptcy takes a lot of time and causes a lot of stress. So yes for a short term you may feel your life has been ruined. Along with all the other shit that comes with it (But that's solely credit rating stuff)Quote:
Originally Posted by Josh
Question,
Is it a bad idea to get say a car loan from the bank for about 5k to purchase a used car? If so, in how many ways is it bad. I didn't figure a small loan like that to be bad. And the car I want is 4k.
I wouldn't think it'd be bad as long as you can pay it off. Especially if you have the 5k already or close to I would imagine it would only benefit you as it'd help towards your credit rating.
I have 4 credit cards right now. I don't really recommend having that many at my age, but I've had them for 2 years so far and I've never had a late payment. I'm certainly not stupid with my cards, but starting this semester has been more expensive than usual and I'm a little uncomfortable with what I have charged right now, but it's nothing a months paycheck can't clear. I definitely want to close one of my cards though.
I'm still learning a lot about this stuff myself, my mom works at a bank and keeps stressing how important good credit is, so she's the one who tells me about all this.
I don't think you'll have many problems Nomi, you seem smart and responsible enough, (not like the type who would go on some huge shopping spree and by a bunch of shit you can't pay for.)
Don't close your card, just stop using it. They look at average legth. Leaving it open will help your score, even if you don't use it.
It's like level grinding for your wallet!
Oh cool I didn't know that, thanks Stormy.
YES alwaysQuote:
Originally Posted by Zerohero
i mean if you absolutely cannot get to work than i guess maybe, but really, buy a cheaper car
Really? I thought the rule was that it was alright as long as you don't (I forget the term) end up paying on one car after it's dead and you have a new car.
What's compound interest? I am intrigued.
http://i.cnn.net/money/galleries/200...es/gal_pie.gifQuote:
Originally Posted by stormy
Right, but that's only half the story. Your credit rating is (partly) determined by the ratio of all your debt to all your available credit. When you close accounts, your available credit goes down, so you could be hurting your credit score as much as you would if you got into debt. (Without actually being in debt, which would suck for more than just your score.)
But if you say had all your cards balance at 0, and then closed a card wouldn't that then leave you with the same ratio?
Here's a protip: Save as much as you can. Just a little peek at what lies ahead for us younger folks.
Take it for what it's worth.Quote:
The massive wave of baby boomers that will soon be eligible for social security and medicare places a tremendous strain on the economy over the next 10-30 years. Social Security gets all the press, but Medicare is the monster problem-------5-6 times the financial strain of Social Security. Another report today shows that the healthcare inflation rate last year was 6.7%, 3 times the regular rate of inflation and not likely to get better anytime soon, no matter whoever wins the election.
it's less horrible that way, sure, but you're still borrowing to own a depreciating asset. you don't actually ever own anything that way - when you stop paying, you stop driving. you may as well have leased.Quote:
Originally Posted by Thief Silver
(if this winds up being cheaper than a lease, then it's not such a bad deal. borrowing a few grand for a used car is infinitely smarter than financing a new car. i would avoid borrowing anything for a car if at all possible, though.)
i mean, if it's the only way to keep on the road, then do what you have to do.
That shit is not going to work anymore, noob.
*to theif*
the total available credit would be lower. its a ratio of borrowed money to money allowed to borrow basically.
That's not necessarily true, part of the enjoyment of a car is that one or two years after you have paid off the car.Quote:
- when you stop paying, you stop driving. you may as well have leased.
IE the Seabring we bought via financing was paid off two years ago.
interest on interest. if you do not pay the interest you owe in full, then the interest is basically tacked onto the principal, so you will have to pay interest on a larger principal going forward. repeat over and over and you can see how the problem is "compounded."Quote:
Originally Posted by Razor Ramon
However, financing a car will in fact help your credit rating, if you make all your payments on time for the life of the car, as far as I can tell that's huge for your credit score and honestly takes up most of what you need.
it's less of an issue if you really have a 0 balance but total credit available is still a factor. also, what if shit happens and you have to max out the one card you have? now you have sort of shitty credit exactly when you might need a loan. but if you had 2-3 other accounts with 0 balances overall you would be in much better shape both in terms of score and availability.Quote:
Originally Posted by Thief Silver
there's no legit financial reason to close accounts. lock them away if you're worried the number will get stolen or you won't remember when you charged with what card or cut them up if you can't trust yourself or someone you live with with them.
if your credit is good enough to begin with to get a very favorable rate...ie one lower than or at least close to what your money can earn on the open market.Quote:
Originally Posted by Thief Silver
but if you have shitty credit, your car loan is going to wind up inflating the cost of the vehicle so much that any credit improvement is not worth what you have to spend on it.
credit is very self-fulfilling this way. it is easy to keep good credit when you already have it if you keep up good habits, and even if you make a few missteps you are much better position to clear them up. but bad credit can be very difficult to dig out of.
According to my credit report my score is around 750 in Fico, so it seems to be pretty good, so I think I should be ok there. But I get what you're saying, I hope to pay off the car in 3 years, and use it for 5 years, versus leasing a car for 5 years I think I'd end up in a better position. But yeah I understand what you're saying. I'd save more money if I had the money right off the bat and never had to pay interest.
I agree whole heartedly, I was just curious if you made your amount borrowed 0 then closed a card would you be ok or at least not take a huge blow.Quote:
it's less of an issue if you really have a 0 balance but total credit available is still a factor. also, what if shit happens and you have to max out the one card you have? now you have sort of shitty credit exactly when you might need a loan. but if you had 2-3 other accounts with 0 balances overall you would be in much better shape both in terms of score and availability.
there's no legit financial reason to close accounts. lock them away if you're worried the number will get stolen or you won't remember when you charged with what card or cut them up if you can't trust yourself or someone you live with with them.
Spoken like a true car hating New Yorker. A car isn't an investment, but it is a necesity for people outside of NYC, and as long as it fits into someone's budget financing a car is not a big deal. It also helps establish more credit. Rates are generally pretty low if your credit is not already fucked up, and automakers often offer special rates below market, even 0%.Quote:
Originally Posted by burgundy
Interest that is accrued in a compound.Quote:
Originally Posted by Razor Ramon
Or in your case, you have an interest in 2 or more girls
you hope, sure. but what if the car breaks down? or it gets totaled? now you are paying for something you don't own.Quote:
Originally Posted by Thief Silver
they have warraties if they break down, and gap insurance if the totalled value is less than the amount left on the loan.Quote:
Originally Posted by burgundy
A) Don't buy American cars.Quote:
Originally Posted by burgundy
B) Insurance.
:D
Protip: You don't technically "own" your car until it is paid off with full interest to the lender. They put a tricky thing called a "lien" on your title.Quote:
Originally Posted by burgundy
it is not a necessity to spend more than a couple grand on a car. i spent my entire driving life owning old cars that got the job done and cost me nothing to not much.Quote:
Originally Posted by stormy
the credit establishing bit is really a nonfactor. you do not need an auto loan to establish credit, and you can do almost as well having open lines of credit that you don't run balances on.
also, a vehicle that you are financing is going to require more and more expensive insurance. which adds up especially if you live somewhere insurance is pricy.
I can live in a straw shack too, but why would I want to if I don't have to?
Or, why do you live in New York when you can live in Iowa and have a lower cost of living?
You live in NY, you don't even need a car.Quote:
Originally Posted by burgundy
financial apples and oranges, this is what people don't understand.Quote:
Originally Posted by stormy
hey, go into debt for a car if you really want, but don't pretend it's any smarter than going into debt for a big hdtv, a shitload of wii games or a bunch of strippers. interest rate differences notwithstanding.
yes, but i have, in my life, owned cars, and these periods coincidentally occurred when i did not live in nyc.Quote:
Originally Posted by Bailey
Which was what. 8% of your life? Why leave NY? You have nothing to gain.
Well when that Super Tsunami wipes out the entire east coast...
Burg did get me thinking though, I should probably put a lot of my extra income into paying off my car as fast as possible, instead of focusing on my student loan. The $225 a month from the student loan is going to take a lot longer to pay off, so if I could pay off most of my car while I still live at home (Because I'll save what $600+ a month in food and living expenses) I can have a lot less to worry about when I move out.
i fail to understand your point. i have lived more years of my life outside of nyc than in it.Quote:
Originally Posted by Bailey
Not to derail the thread, but national controlled healthcare could solve a number of issues related to medicine production. Just a possibility.Quote:
Originally Posted by Type Ryan
you should obviously pay off whichever balance has a higher interest rate first. period.Quote:
Originally Posted by Thief Silver
and if your bank loan has a higher rate than your student loan, see if you can defer/forbear your student loan. then shoot as much money as possible at the higher interest loan.
this is essentially how i got out from under a mountain of debt: by forbearing low (federal) and medium (commercial) interest student loans, and moving some high interest debt to zero apr promotional accounts, i was able to clear out the high interest credit card dent. then i refinanced the low interest federal loan, got another forbearance, and in that time i blew out the commercial student loan.
Yeah, because it would stop development due to lack of profit potential.Quote:
Originally Posted by Destin
stopitnow
Actually talked with my dad and that's not really true. Because the student loan is Tax deductable and the car loan not so much.Quote:
Originally Posted by burgundy
Some claim that Einstein said compounding interest is the most powerful force in the universe. Or you could just read what Burg posted. I agree with both.Quote:
Originally Posted by Razor Ramon
This is wise. Get that car note off your books immediately. Debt should only be used as some form of carry trade, investment related acquisitions, emergencies, or to build and establish credit so that you have access to more lines, more capital, at favorable rates. There are probably a few more reasons but I will ignore them for now.Quote:
Originally Posted by Thief Silver
If what you're saving by having it be tax deductible exceeds the interest you'll be accumulating, sure, but that doesn't seem as likely to me. Granted I don't know he loan amount or anything. But don't pass it off as being better simply because it's deductible.Quote:
Originally Posted by Thief Silver
that's sort of a good point i forgot about. but it's only the interest that's deductable, not the full amount. so if you're spending a lot of money paying down principal you're not going to reap the benefits of a higher deduction. although the deduction is nice because it's an above the line deduction which means you can claim it on top of (not instead of) your standard deduction, it phases out the more you make, and if you make more that $65K you're not eligible.Quote:
Originally Posted by Thief Silver
i can't imagine this break would be worth more than a half point of interest.
also, rates being the same, i'd rather owe on my education than on my car. if i am struggling with student debt a lender is much more likely to work with me because they have little choice. miss a couple of car payments though and they will take your car and fuck your credit too.
The thing is, I'm not worrying about it.Quote:
Originally Posted by icarusfall
I don't work my job because I'm worried about money, I work it because I'd like the things money would buy. Same with the credit score, I'm not going to build it because I'm worried about it, but because I want what a good one would offer.
I can't believe how irrationally paranoid you are about this.
this by the way includes debt relating to REAL ESTATE (aka a home) and EDUCATION because these are investments we expect to grow in value in addition to whatever immediate purposes they serve. real estate should literally grow in value (at least over time, if not every year) and education should translate into dramatically increased earning potential.Quote:
Originally Posted by Gooch
Oh I've decided for sure that I want to pay off my car fast. I was just making the point that there are benefits to not paying the student loan first and I think I'm better off doing the car as fast as possible.Quote:
Originally Posted by burgundy
True. However, I just meant I don't get caught up in the interest game they love to catch people in.Quote:
Originally Posted by Rich