Credit Card Advice & responsible Spending?

[brandon3000]

Bro's

I paid off my one and only credit card and I'm strongly considering closing it. At some point last summer I put a plane ticket and hotel cost on there that was like $800 total and after interest and irresponsibly just making minumum payments the balance shot up to $1800 or so and I just kept looking at it like

with 27% APR i guess thats how it goes with the intertest but still it was pretty crazy to see the balance jump like that. anyways after a few lump payments I was able to get it down to $0. So I wanted to ask some advice about money management.

essentially I'm thinking that to close my only credit card account could hurt me in an emergency, and is it true that if your credit is positively effected if you keep a credit card for years without missing payments?

I was also wondering what kind of rules guys have to keep their credit card from going HAM with interest. Iw as thinking like just to keep my credit right maybe it'd be best to make a purchase and then simply pay it off right away. like shoes, groceries, ect. things that i can pay for with cash.


any ways any advice is appreciated. peace

 

[rfx45]

Don't close the account but cut up the card so you don't use it since as you stated, you may not have enough self control.

 

[brandon3000]

lol i have self control, i just didn't pay attention to the fact that minimum payments just KEEP you in debt. but when you say cap it u mean set a restriction for purchases or the balance all together

 

[rfx45]

No by cut it up I meant destroy the card so you can't use it anymore.

If you really are responsible, use the card strictly on gas and groceries and pay it all off every month before it incurs interest. That should build your credit but again, it'll be on self control.

 

[heatking]

when i first got my credit card i just used it to pay my daily driver car payment then pay it off right after to help build credit. didn't really use it for much besides that. thats what i would recommend credit cards for.

 

[eff ecks]

dont close your card. It will cause a small ding on your credit plus im sure you'll have a use for the card in the future. you need to 1) only use your card for emergencies if you can. 2) pay off those balances before the statement due date. If you cant, you need to reevaluate the purchase from jump. 3) ask for a lower interest rate. 27% is a fools rate. also ask if there are any promotions for lower retail purchase APRs.

there's no big secret to money management when it comes to credit cards, just live within your means and think rationally about what you can pay off. Also MAKE MORE MONEY!

 

[mercutio]

I suggest that you keep the card, since one aspect of your credit score is your credit history. If you close that card, it will affect your credit history and then your credit score. Use the card for something you can manage but need anyway, like groceries or gas, and pay it off every month. Then ask for an increase in limit or decrease in interest rate as you become more reliable.

 

[brotherforreal]

Like RFX said, "cut it up".

If you close it, goodbye to a few points on your FICO.

Try paying your bills with it so you know you'll pay it off as soon as it posts. It'll help your score but if you have no control, just cut it up.

 

[kiendienn]

never spend over 30% of your limit, never keep a balance

that's how i treat my 2 cards, and my credit score steadily climbs

 

[brandon3000]

Some good advice here. Thanks

 

[typerpinoy]

i never charge anything that i can't afford to pay off immediately and pay it off each month. that way i never carry a balance

 

[runningfishy]

Originally Posted by Brandon3000

Bro's

I paid off my one and only credit card and I'm strongly considering closing it. At some point last summer I put a plane ticket and hotel cost on there that was like $800 total and after interest and irresponsibly just making minumum payments the balance shot up to $1800 or so and I just kept looking at it like

with 27% APR i guess thats how it goes with the intertest but still it was pretty crazy to see the balance jump like that. anyways after a few lump payments I was able to get it down to $0. So I wanted to ask some advice about money management.

essentially I'm thinking that to close my only credit card account could hurt me in an emergency, and is it true that if your credit is positively effected if you keep a credit card for years without missing payments?

I was also wondering what kind of rules guys have to keep their credit card from going HAM with interest. Iw as thinking like just to keep my credit right maybe it'd be best to make a purchase and then simply pay it off right away. like shoes, groceries, ect. things that i can pay for with cash.


any ways any advice is appreciated. peace

I'm sorry you have to go through this, but this should be a big wake up call.  Everyone has their own method, but ultimately, it comes down to self-control.

Always know your financial position.  A credit card should NEVER be used to FINANCE any purchase.  It is simply for convenience and liquidity purposes.  If you are actually financing your purchases, you should not be using it.  Instead, you should be finding a better way to manage your money.  I use my credit card whenever I can because it is convenient and I can document and record keep my purchases.  There are lots of financial programs out there that can help you.  I personally use quicken.

Have you talked to your folks about this?  They should give you more insight.  

 

[nbirn2103]

Never put something on your CC that you can't pay off at the end of the month!

27% is robbery!

 

[6 Rings G.O.A.T.]

Self-control..

 

[michael0360]

YOLO man forget paying them back

 

[ludex360]

i use my credit card to pay for everything, stacking points

 

[mojodmonky1]

Originally Posted by michael0360

YOLO man forget paying them back

if you dont care about your credit or having to live cash and carry forever, listen to this guy (joking).

but seriously, if you know you have the self control to payoff the balance at the end of each month you might want to look into  getting an airline miles card or other rewards card.  i put pretty much all my spending through my Chase Sapphire Preferred Card.  Everything except my gambling (my bookie doesnt take credit card payments).  Hell, even some of the weed dispensaries I go to accept credit card so I can pay for my buds with it.  At the end of each month, I just payoff the balance and accrue the points.  In 4 months I've already accrued over 80K points (including the sign up bonus).  At the end of the year when they try to charge me the annual fee, ill see if I can get them to waive it and if not, i might just close the account and open up a different rewards card.

  

 

[dajoka004]

Credit cards are a consumer's best friend provided he or she can manage their money correctly.
I own a handful of cards that count toward my credit score...

1. American Express Gold Rewards: Amex is by far the best credit card company. The gold card fee is $175 a year (waived in the first year), but you will easily make that back. I've earned $160.50 in credits since I got my card at the end of November. Also got $20 in Starbuck's gift cards, $140 in Amex gift cards and $10 in Godiva gift cards from their holiday gift chain program. So $330.50 in just four months for spending money I was going to spend anyways. And I've racked up >20,000 points.

2. Citi Visa Platinum Dividend Rewards: I use this everywhere that Amex isn't taken. I got back $200 for spending $500 in the first three months. That's 40% cash back. I get 1% back on every purchase, and they do quarterly bonuses for 5% cash back on certain purchases. Again, easy money.

3. Barclay Visa iTunes: I got this when I got my Macbook three years ago. I only use it for large Apple purchases (my iPad, my next computer), because it's no interest for 6 or 12 months depending on the final price. 

4. Amazon Store Card: Everyone buys stuff on Amazon. It's an easy way to build credit.

5. Brooks Brothers Store Card: I get 4 points for every dollar I spend at Brooks Brothers. Every 2000 points I get a $20 gift card. That amounts to 4% cash back. I buy just about all my clothes there, so it makes sense to have it.

 

[asianplayer]

I wouldn't cancel it cause your credit will go down. However, if you have no self control, I would cancel it. Not worth paying interest unless it was an absolute emergency and you have no other funds.

 

[azndood21]

OP.. I would definitely keep the credit card open. I would honestly call the card company and see if they have a rewards program..

A lot of people don't know about how great reward programs are but im telling you, it's so worth it! I buy everything with my card: shoes, clothes, groceries, etc. and it builds quickly. Every $10,000 you spend is 10,000 points. 10,000 points = $100 cash.. In the past year I've accumulated $600 free cash just by using my card and paying it off quickly.

Think about it, get your tax returns + free rewards money!