Viewing a single comment thread. View all comments

Vidableek t1_j58iab1 wrote

Avoid credit cards as much as humanly possible. If you must or just to build credit, ONLY spend as much as you have in cash or can comfortably pay back within 3 months (on time payments). The "correct" way to use credit is a little more involved than I care to write but this is the basics.

Source: I'm supremely bad with financial planning and have accumulated over 10k in CC debt over the last 12 years... it sucks.

4

The-GreyBusch t1_j58t15t wrote

Credit cards aren’t all that bad. They’re needed to establish/build credit which you’ll need one day to get a loan. Like you’re saying though, only spend what you can afford. Most cards carry a high interest rate which can bury you so don’t put huge purchases that you need to payoff over time on them unless you have a card with a low interest rate or a store card that allows x amount of months that are interest free. I use my cards for everything because of the cash back rewards and it’s nice to get something extra for the money you would be spending anyway.

5

OG-Pine t1_j5c3yxa wrote

Avoiding credit cards is a horrible idea in todays society. You should ideally be using your credit card to pay for absolutely everything that doesn’t charge a fee for it.

Be extremely diligent about paying it off and you will be way way better off than if you didn’t use the card at all. You can set up auto-payments, or manually pay it every paycheck, but just make sure it’s down to 0 by the end of the month. Personally, I bring it zero every week cause it’s an easy routine on Fridays and gives me peace of mind.

But you’re right never ever spend more than you have in your bank, that’s a recipe for disaster.

2

Odd_Law8516 t1_j5cp9j2 wrote

OP (if you're in the US where credit scores are a thing), find out if your bank will give you a secured credit card. This is when you give your bank, say, $200, and your bank gives you a credit card with a $200 dollar limit; they hold that money in case you don't pay your credit card bill (and whenever you close the credit card, you get that money back). This is a good way to start to build credit (which is very helpful for getting housing on your own) without risking serious debt. Use the card occasionally, and make sure to pay it back immediately. Put it on autopay, if you have enough money regularly in you bank account.

1

VassalizedCheese t1_j5e49im wrote

Bad advice. Maybe those who are financially irresponsible should avoid them, but there is no excuse not to use them in today's day and age.

Just be responsible and pay off your balance each and every month. You will need a credit score for all major purchases in your life, and there is no quicker way to build one.

You should not treat credit cards as a source of free money. They are a form of debt, which is neither good nor bad - it's a tool.

1