Author Topic: The typical American is always in credit-card debt  (Read 17063 times)

Goldielocks

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Re: The typical American is always in credit-card debt
« Reply #50 on: February 15, 2016, 02:08:05 PM »
Studies show that people spend more with credit than cash, and I assume that means even responsible people.

That always has struck me as odd.  I rarely whip out the CC or debit card for anything except stuff I need (groceries, gas, home improvement project stuff), but once cash hits my wallet it flows out like water, usually on stupid incidental purchases.  In general, I grab myself a $20 when grocery shopping on the weekend and that's my "allowance" for the week for grabbing a drink out of the vending machine, lunch out 1x a week, etc.  To my mind, cash is already out of the bank balance, whereas anything else comes out of that money.  Silly, maybe, but just how I've always been.

Same here. I find those studies suspicious. I don't believe it. I also don't see how it would work, logistically. When I'm in a store I pick out what I'm buying, then go to the checkout and pay. That's when I decide how to pay. How would the payment method affect what I pick up, when that happens before? Would I see the wad of cash and go put the chocolate back, but not if it was a card? Or would I have to be thinking that I was paying with cash before I walked in, and that would make me pick up less stuff?

Yes, that is absolutely how it works....   when the bill rings up as $220 and you have $200 in your wallet, you reach over and pull out the chocolate bar, the barbeque sauce, and the fancy cheese, because you only want them, don't need them this week.

Next time, you take a more accurate run through in your head as you are putting items in your cart, actively grabbing the no name laundry soap instead of Tide to save $5 so you can buy a chocolate bar with your grocery allowance....

Goldielocks

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Re: The typical American is always in credit-card debt
« Reply #51 on: February 15, 2016, 02:11:10 PM »
Cash doesn't come with rewards. I don't understand why anyone who is responsible with money would use it.
Simplicity
Control

Another big one: privacy. Those credit card rewards aren't free; they come at the cost of letting marketers, the government, etc. pry into your spending habits.

"Hey Bob, look at this guy: grocery, home depot, Shell.  Grocery, home depot, Shell.  Oh, a restaurant.  Then...Grocery, home depot, Shell.  What a loser!"

LOL

Better yet, do you know what they do with that information?  they say to themselves... HMM a lot of Home Depot customers buy fuel at Shell.   and PRESTO -- Home Depot pays Shell to start handing out Home Depot coupons at the pump. 

Yep,  it is a tragedy.

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Re: The typical American is always in credit-card debt
« Reply #52 on: February 15, 2016, 02:21:54 PM »
Studies show that people spend more with credit than cash, and I assume that means even responsible people.

That always has struck me as odd.  I rarely whip out the CC or debit card for anything except stuff I need (groceries, gas, home improvement project stuff), but once cash hits my wallet it flows out like water, usually on stupid incidental purchases.  In general, I grab myself a $20 when grocery shopping on the weekend and that's my "allowance" for the week for grabbing a drink out of the vending machine, lunch out 1x a week, etc.  To my mind, cash is already out of the bank balance, whereas anything else comes out of that money.  Silly, maybe, but just how I've always been.

Same here. I find those studies suspicious. I don't believe it. I also don't see how it would work, logistically. When I'm in a store I pick out what I'm buying, then go to the checkout and pay. That's when I decide how to pay. How would the payment method affect what I pick up, when that happens before? Would I see the wad of cash and go put the chocolate back, but not if it was a card? Or would I have to be thinking that I was paying with cash before I walked in, and that would make me pick up less stuff?

Yes, that is absolutely how it works....   when the bill rings up as $220 and you have $200 in your wallet, you reach over and pull out the chocolate bar, the barbeque sauce, and the fancy cheese, because you only want them, don't need them this week.

Next time, you take a more accurate run through in your head as you are putting items in your cart, actively grabbing the no name laundry soap instead of Tide to save $5 so you can buy a chocolate bar with your grocery allowance....
But then you're limited by not physically having the money, not that one payment method is more "painful" then another. The studies claimed that with "infinite" cash you'd still spend less than with a CC.

And in practice having to put things back seems like a huge PIA. I always study cost/oz of items, no matter how I pay.

Goldielocks

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Re: The typical American is always in credit-card debt
« Reply #53 on: February 15, 2016, 02:38:59 PM »
Studies show that people spend more with credit than cash, and I assume that means even responsible people.

That always has struck me as odd.  I rarely whip out the CC or debit card for anything except stuff I need (groceries, gas, home improvement project stuff), but once cash hits my wallet it flows out like water, usually on stupid incidental purchases.  In general, I grab myself a $20 when grocery shopping on the weekend and that's my "allowance" for the week for grabbing a drink out of the vending machine, lunch out 1x a week, etc.  To my mind, cash is already out of the bank balance, whereas anything else comes out of that money.  Silly, maybe, but just how I've always been.

Same here. I find those studies suspicious. I don't believe it. I also don't see how it would work, logistically. When I'm in a store I pick out what I'm buying, then go to the checkout and pay. That's when I decide how to pay. How would the payment method affect what I pick up, when that happens before? Would I see the wad of cash and go put the chocolate back, but not if it was a card? Or would I have to be thinking that I was paying with cash before I walked in, and that would make me pick up less stuff?

Yes, that is absolutely how it works....   when the bill rings up as $220 and you have $200 in your wallet, you reach over and pull out the chocolate bar, the barbeque sauce, and the fancy cheese, because you only want them, don't need them this week.

Next time, you take a more accurate run through in your head as you are putting items in your cart, actively grabbing the no name laundry soap instead of Tide to save $5 so you can buy a chocolate bar with your grocery allowance....
But then you're limited by not physically having the money, not that one payment method is more "painful" then another. The studies claimed that with "infinite" cash you'd still spend less than with a CC.

And in practice having to put things back seems like a huge PIA. I always study cost/oz of items, no matter how I pay.

Okay, under the concept of infinite cash, I would agree that there is an impact, but it is minor.   Cash is very nice for counting, physically, each month as you save a stash.  Charts and spreadsheets are nice, but something about counting $20's....

Putting things back IS a huge PIA.  Which is why this works for getting used to a new lower budget, which is hard enough to do, but CC's make it too easy to tell yourself "next time" and not put anything back or work harder to mentally track while in store -- I have to write it down as I place items in the cart, if I am buying more than $200...and want to be within $5.

LeRainDrop

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Re: The typical American is always in credit-card debt
« Reply #54 on: February 15, 2016, 07:54:35 PM »
The studies claimed that with "infinite" cash you'd still spend less than with a CC.

But with infinite cash I could buy whatever I want whenever I want and still have more cash!

Lmoot

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Re: The typical American is always in credit-card debt
« Reply #55 on: February 15, 2016, 11:53:35 PM »
I've been consistently in credit card debt for about the last 5 years. Never paid a cent of interest in my life. Does this study take 0% credit card offers into account (which can go on for up to 2 years?). Every card I've opened (except for my oldest card which I got in college and never used until I had a job post-graduation) I signed with a 6-18 month 0% promotional offer. I have 2 credit cards that when you spend a certain amount within 48 hours, it automatically re-triggers the 0% offer, so I don't even need to open a new card to get it. I pay the minimum and use the cash for other money-making endeavors, or keep it in high-yield savings.

It's the fashion now for cc's to come with these offers so I think it would definitely make a difference in the study to differentiate between those who carry a balance at no cost, and those who pay interest to carry a balance.
« Last Edit: February 15, 2016, 11:56:33 PM by Lmoot »

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Re: The typical American is always in credit-card debt
« Reply #56 on: February 16, 2016, 06:39:00 AM »
Okay, under the concept of infinite cash, I would agree that there is an impact, but it is minor.   Cash is very nice for counting, physically, each month as you save a stash.  Charts and spreadsheets are nice, but something about counting $20's....


I'm sorry, but that sounds like the personal finance strategy of an 8 year old.  I don't value being able to physically count my money. Having it in my house means that it isn't earning even the paltry interest of a savings account, much less working harder in other investments.  I see almost zero value to having actual cash.




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Re: The typical American is always in credit-card debt
« Reply #57 on: February 16, 2016, 06:54:15 AM »
Okay, under the concept of infinite cash, I would agree that there is an impact, but it is minor.   Cash is very nice for counting, physically, each month as you save a stash.  Charts and spreadsheets are nice, but something about counting $20's....


I'm sorry, but that sounds like the personal finance strategy of an 8 year old.  I don't value being able to physically count my money. Having it in my house means that it isn't earning even the paltry interest of a savings account, much less working harder in other investments.  I see almost zero value to having actual cash.
If you position it carefully under that old, worn-out mattress, it could help flatten out the ruts and extend the usable life by a few years. There might be a tangible ROI associated with that.... ;)

Goldielocks

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Re: The typical American is always in credit-card debt
« Reply #58 on: February 16, 2016, 09:02:29 PM »
Okay, under the concept of infinite cash, I would agree that there is an impact, but it is minor.   Cash is very nice for counting, physically, each month as you save a stash.  Charts and spreadsheets are nice, but something about counting $20's....


I'm sorry, but that sounds like the personal finance strategy of an 8 year old.  I don't value being able to physically count my money. Having it in my house means that it isn't earning even the paltry interest of a savings account, much less working harder in other investments.  I see almost zero value to having actual cash.

ha ha

I didn't think counting was anything special either, until I did it.   
At first, whatever $sum  I saved from groceries, household, etc., went into my personal allowance, and it was the first time in over 20 years of marriage that I had a personal allowance, that was all mine to spend without nagging or guilt, so that may have been related to it, but I don't know.  There was a magical moment there...

Really, for those that have not tried a cash based system, it is a superior method for changing spending habits, and something about the tactile / physical nature is unexpected.

If you don't need to change spending habits, then there is no point.
« Last Edit: February 16, 2016, 09:05:55 PM by goldielocks »

Lmoot

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Re: The typical American is always in credit-card debt
« Reply #59 on: February 17, 2016, 12:28:59 AM »
I spend cash like it's nobody's business. I also get extremely altruistic when I have cash. Homeless? Here, go forth and prosper for another day. Selling candy bars? Sure, I'll take 10! You need gas money and you'll pay me back (even though we both know you won't)...a tank on me! Need sponsors to send your kid to dance camp? Hmm, all I have left is a $20; oh, no change? Well that's ok, I'm a patron of the fine arts!
I'm sorry I don't have a quarter to help out with your bus ticket :( but if I did, I'd give it to you and only you.

The way my mind works with cash is I think "Whelp, the cat's already out of the bank so let the wind (or wherever fate takes it) have it". It's not logical but since we are only mindful a relatively small proportion of time, I don't catch myself often. Using a credit card gives me more of a sense of control because I can impact today, what that future bill is going to look like. I can only explain it as I feel more motivated by the goal to keep cash in the bank (by keeping my cc bill low), than to not spend cash that's out of the bank (like any form of an envelope system).

And running out of cash in my pocket doesn't stop me from buying what I want if I'm paying cash only. There are close to a half million ATMs in the U.S., and they're usually placed conveniently close to the thing I'm spending money on.
« Last Edit: February 17, 2016, 12:44:45 AM by Lmoot »

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Re: The typical American is always in credit-card debt
« Reply #60 on: February 17, 2016, 08:00:38 AM »
In an odd way, I think the many hours of playing computer games growing up has helped prepare me for a life where I use the credit card as a spending tool. Seeing resources/money as mere numbers on a screen has become "real" enough for me.

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Re: The typical American is always in credit-card debt
« Reply #61 on: February 17, 2016, 08:58:12 AM »
That article is pretty shocking. I've never had cc debt in my entire life and I use my amex for everything in order to get rack up points.

Dicey

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Re: The typical American is always in credit-card debt
« Reply #62 on: February 17, 2016, 09:49:39 AM »
Don't see that anyone's pointed out that once cash gets lost or stolen, it's gone for good, whereas a lost or stolen CC is a snap to replace.

No theft protection for anything purchased with cash.
No warranty extension       "  "
No detailed records            "  "
No points/miles/rebates   "  "
No ability to look back to see when/where an item was purchased...
And good luck renting a car or traveling without one.

For years, I maximized my savings and carried little cash. Now, if there's significant cash in the house, it makes me vaguely uneasy.

YMMV, but they'll pry my rewards CC's out of my cold, dead, long-FIRE'd hands. OTOH, for most of the same reasons, I rarely use a debit card. The only reason I carry one is for Winco and random odd cash needs.

Just as good dietary habits lead to a healthy weight, good spending habits equate to greater wealth. It's all about self-control.

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Re: The typical American is always in credit-card debt
« Reply #63 on: February 17, 2016, 09:50:28 AM »

Another big one: privacy. Those credit card rewards aren't free; they come at the cost of letting marketers, the government, etc. pry into your spending habits.

I figure they are spying on me anyway. Might as well benefit from it.

Yup! Each time I look at an item on Amazon, it appears on my FB feed and elsewhere.
That's because, when you got to Amazon's site, it loads a Facebook Exchange (FBX) tracker. The Amazon homepage loads 16 trackers, including Amazon Associates, Google AdSense, FBX, DoubleClick, Twitter Advertising, plus lessor known ones.
You want to stop this? Get the Ghostery add-on for your browser AND the Ghostery browser for you Android smartphone. Worse than advertising is trackers who record your every click. In the name of "Analytics".

Dicey

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Re: The typical American is always in credit-card debt
« Reply #64 on: February 17, 2016, 10:18:03 AM »

"Hey Bob, look at this guy: grocery, home depot, Shell.  Grocery, home depot, Shell.  Oh, a restaurant.  Then...Grocery, home depot, Shell.  What a loser!"
HA! Writing the comment above and thinking about Chris22's "loser" comment reminded me of a credit story from the DC archives...

In early 2008, I decided to ratchet up my savings as high as possible. Started with a no-spend February and kept not spending for months afterward. I only bought the few groceries I needed at the 99 Only Store. Saved more that year than I ever imagined possible. I dumped it all in the stock market. Boy, was I amazed when the market recovered. My income stayed constant, my spending decreased, my savings soared and my net worth reached  FI.
 
Then I noticed that my credit limit had been slashed on my primary affinity card. I called B of A to ask why and was told "Well, you're only shopping at places like the 99 Cent Only Store.". WTF??? If I'm a "loser",  I guess I'm a lucky one. BTW they never raised the limit, so I switched to a better rewards card, which I use for everything, and RE'd. Loser indeed!

galliver

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Re: The typical American is always in credit-card debt
« Reply #65 on: February 17, 2016, 11:03:09 AM »
Studies show that people spend more with credit than cash, and I assume that means even responsible people.

That always has struck me as odd.  I rarely whip out the CC or debit card for anything except stuff I need (groceries, gas, home improvement project stuff), but once cash hits my wallet it flows out like water, usually on stupid incidental purchases.  In general, I grab myself a $20 when grocery shopping on the weekend and that's my "allowance" for the week for grabbing a drink out of the vending machine, lunch out 1x a week, etc.  To my mind, cash is already out of the bank balance, whereas anything else comes out of that money.  Silly, maybe, but just how I've always been.

Same here. I find those studies suspicious. I don't believe it. I also don't see how it would work, logistically. When I'm in a store I pick out what I'm buying, then go to the checkout and pay. That's when I decide how to pay. How would the payment method affect what I pick up, when that happens before? Would I see the wad of cash and go put the chocolate back, but not if it was a card? Or would I have to be thinking that I was paying with cash before I walked in, and that would make me pick up less stuff?

Yes, that is absolutely how it works....   when the bill rings up as $220 and you have $200 in your wallet, you reach over and pull out the chocolate bar, the barbeque sauce, and the fancy cheese, because you only want them, don't need them this week.

Next time, you take a more accurate run through in your head as you are putting items in your cart, actively grabbing the no name laundry soap instead of Tide to save $5 so you can buy a chocolate bar with your grocery allowance....
Except, if you are over cautious, like me, you would keep a little more on hand than you strictly need (in case you find a good deal, or remember something you forgot you needed, or simply because you only stop by the ATM so often). So now that situation never happens.

And the result is the same as using a card. You go to the store and buy the things you need and a few things you want that you decide you can afford/are worth it.  You buy the bbq sauce because it's on sale and the Tide because it gets bbq sauce out better. You skip the chocolate because you are trying to eat better and have fruit to snack on once you get home. You buy shampoo because you look at it and realize you barely eked out enough from the container that morning, but hadn't put it on your list.

Jack

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Re: The typical American is always in credit-card debt
« Reply #66 on: February 17, 2016, 01:29:36 PM »
Cash doesn't come with rewards. I don't understand why anyone who is responsible with money would use it.
Simplicity
Control

Another big one: privacy. Those credit card rewards aren't free; they come at the cost of letting marketers, the government, etc. pry into your spending habits.

"Hey Bob, look at this guy: grocery, home depot, Shell.  Grocery, home depot, Shell.  Oh, a restaurant.  Then...Grocery, home depot, Shell.  What a loser!"

LOL

Better yet, do you know what they do with that information?  they say to themselves... HMM a lot of Home Depot customers buy fuel at Shell.   and PRESTO -- Home Depot pays Shell to start handing out Home Depot coupons at the pump. 

Yep,  it is a tragedy.

More like "hmm... in the last month this guy has bought [some politically controversial book] from Barnes and Noble, a pressure cooker from Bed Bath and Beyond, and fertilizer from Home Depot. He's obviously some kind of terrorist; let's no-knock warrant him and ship him off to Gitmo!"

(And if you think the US government would never do such a thing, click the link.)

mm1970

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Re: The typical American is always in credit-card debt
« Reply #67 on: February 17, 2016, 02:41:41 PM »

I have cash, and I keep it forever.  I am slow to spend cash.  If I go to the grocery store with $70, then I carefully spend less than $70. 

If I use credit or debit, I'm more likely to spend more.  (I get around this with a list, or just by not shopping.)

I suppose that's a natural limit on it, but also don't see the point. If I need milk, bananas and eggs for the week, but I don't have enough cash on me to buy it all then what have I gained? I go hungry because I didn't carry enough cash? Yes I guess I'd spend less, but I don't see much value in that, I'm not that poor. I buy what I need, how I pay for it doesn't much affect what I decide I need.

On the other hand I never get soda or vending machine snacks. And never feel much need to.
Personally, I did best on my grocery budget when I used a cash only system.  I still do pretty well.

For example, it's not just "oh I need bananas, eggs, and milk".  I have food in the pantry, fridge, and freezer.

So let's say that my budget is $70, and I need things that add up to $90.

I don't buy all the things.  I leave some things behind.

Of those things, which do I need the least?  Milk would be hard to go without with the kids.  Coffee - well, I could survive with work coffee and tea at home if necessary.
Eggs?  I like eggs, we eat eggs, but I could skip them for a week.  I could make bread instead of muffins.

Setting a budget and taking cash means I'm choosing to purchase SOME things that I need, just not ALL things that we are out of.  It also means I'd have to be more creative in the kitchen.  With cash, too - that $2.50 bag of chips doesn't look so great when we are almost out of milk.

It's very much a personality thing though. 

Goldielocks

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Re: The typical American is always in credit-card debt
« Reply #68 on: February 18, 2016, 12:55:47 AM »
Cash doesn't come with rewards. I don't understand why anyone who is responsible with money would use it.
Simplicity
Control

Another big one: privacy. Those credit card rewards aren't free; they come at the cost of letting marketers, the government, etc. pry into your spending habits.

"Hey Bob, look at this guy: grocery, home depot, Shell.  Grocery, home depot, Shell.  Oh, a restaurant.  Then...Grocery, home depot, Shell.  What a loser!"

LOL

Better yet, do you know what they do with that information?  they say to themselves... HMM a lot of Home Depot customers buy fuel at Shell.   and PRESTO -- Home Depot pays Shell to start handing out Home Depot coupons at the pump. 

Yep,  it is a tragedy.

More like "hmm... in the last month this guy has bought [some politically controversial book] from Barnes and Noble, a pressure cooker from Bed Bath and Beyond, and fertilizer from Home Depot. He's obviously some kind of terrorist; let's no-knock warrant him and ship him off to Gitmo!"

(And if you think the US government would never do such a thing, click the link.)

Aw, come on, there is more than enough data on the Government tracking your Google and other internet usage, that the credit card stuff is pitiful in comparison...

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Re: The typical American is always in credit-card debt
« Reply #69 on: February 18, 2016, 02:09:27 PM »
I've been on both sides of this.  I carried a balance on my credit card pretty much through my twenties and the first half of my thirties.  I found it very easy to charge things I never would have had the cash to purchase.  I knew about the finance charges I was paying - I was using Quicken most of this time and tracking it all.  But I was in a mindset where that charge was just the fee I paid for the ability to buy these things earlier than I normally could.  I'd have around $50 in interest to pay in a month and think, well - that's less than the cable bill.  And that new computer sure is fast.  Once I was in that mindset, any charge wasn't a particular problem - it was just a tiny addition to an already large pile.

But now that that I've got my head on straight and am focusing on reaching FIRE, I find I'm much less likely to spend on the card than I am with cash in my wallet.  If I have a sudden desire to go to the local Mexican place for lunch and I have cash, I'm probably going.  But if I would have to use the card, I think about whether I want to have an entry in my records saying I spent $8 on a burrito on Tuesday, March 23rd of 2015; and stare at that for the rest of my life.  No, I really don't.  So I'm not likely to go.  As a result, I help myself stay on budget by having only a set amount of cash per week for nonsense spending.

But I totally get where people who have a revolving balance already would be prone to spend more with the card.  Every purchase just seems so small.  That's why people like Dave Ramsey and Suzie Orman - people who's audience are those who are deep in credit card debt - recommend going cold turkey. 

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Re: The typical American is always in credit-card debt
« Reply #70 on: February 21, 2016, 07:56:25 AM »
I love having that $8 burrito stare at me for all eternity. I use my debit card and there that purchase is on my banking software. Having it there slows my spending. I had to work past the effects of cash vs card b/c cash is where I need to be but I want that tracker for myself. Accountability to myself.

Yeah I ought to be using a cc for the reward points but once we paid that sucker off, I can't stand to use it and would cut it up but on out of town trips for work I use that vs the debit card for security.

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Re: The typical American is always in credit-card debt
« Reply #71 on: February 21, 2016, 11:12:50 AM »
Before I had a credit card, I didn't understand that carrying a balance was even an option, I thought you were required to pay it off each month. Then I got my first student credit card, which had I think a $5k limit. I had heard of this concept of maxing out your credit card, and knowing that my limit was relatively low due to it being a student credit card, I was so confused how someone with a much higher limit than that could possibly max out their credit card. How could any normal person spend so much money in a single month?

I think I spent about 5 years in that state of confusion before I realized you were actually allowed to carry a balance to the next month.

Kaspian

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Re: The typical American is always in credit-card debt
« Reply #72 on: February 26, 2016, 02:01:17 PM »
At 26 I moved out to Vancouver, frittered away meagre savings while looking for work and ended up flat (destitute) broke.  Too proud to sign up at the welfare office, I began living off the cards and one time I actually paid one credit card bill with cash advance money from another one and vice-versa.  Absolutely, fucking terrifying!!  As soon as I landed employment I paid them both off as soon as possible and swore that would not only never do that again, but I'd ensure I was never again in a financial position to even have to consider it. 

But lots of people out there now seem willing to do that and are fine with it--pay off one debt with another.  "I'll do a balance transfer to a new one, I'll pay that with my LOC, consolidate, etc."  I've met so many people who aren't handling credit card debt, just shifting it--like swirling their finger around in the water of a toilet bowl.

Kaspian

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Re: The typical American is always in credit-card debt
« Reply #73 on: February 26, 2016, 02:05:57 PM »
I think I spent about 5 years in that state of confusion before I realized you were actually allowed to carry a balance to the next month.

I don't know if that was pure confusion.  From what I understand, with American Express people used to have to pay their card off in full each month.  (If they didn't have some sort of platinum one.)  Maybe AMex still works that way?  I don't know.  You might have heard about that at some point so thought that's the way it all worked.

slugline

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Re: The typical American is always in credit-card debt
« Reply #74 on: February 26, 2016, 03:04:55 PM »
AmEx cards did start as charge cards that had to be paid in full each month. Then AmEx joined the credit card market in the 80s with accounts that could carry forward a balance. I used to have an American Express Optima card. It felt like a novelty back in the day.

If memory serves correctly, Discover began in the 80s also -- what a great time for American personal finance!

MilesTeg

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Re: The typical American is always in credit-card debt
« Reply #75 on: February 26, 2016, 03:17:52 PM »
I still run into people who insist they're supposed to carry a balance in order to have a good credit score.  One of them recently was one of my employees who is looking to close on a house soon.

Using your credit cards does improve your score. It doesn't require not paying them off month-to-month, only that there is activity and an "average" balance that's a couple % of your max at least. The thing is the reporting agencies only query your balance occasionally, so as long as the balance shows up at the time they query it, you get "credit" for that balance regardless of whether or not you pay it off at the end of the month.

Creditors like it because it shows you can responsibly use credit (which is what using your card but keeping a low utilization % typically indicates). And, unless it's your ONLY credit usage, it's only a small effect (I typically see 3-8 FICO points in swing as my reporting balance changes).

AlsoMost credit card companies have a 30-90 "grace period" so you can "carry a balance" without actually getting interest charges. My "convenience" card has a 60 day grace period, and I just pay off each month the amount that would fall out of the grace period. So my account rarely gets to "zero". Typically I screw it up a couple times a year and end up with a couple bucks in interest charges for the year, but that's only because I don't see an ROI in putting the time into the diligence necessary to prevent that couple bucks getting charged.
« Last Edit: February 26, 2016, 03:21:56 PM by MilesTeg »