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Author: MoodyAllen Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308225  
Subject: Re: Does this sound like a good idea? Date: 10/26/2000 9:04 PM
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reikiman:

"Well, this may seem like heresy, but paying interest isn't all bad. Use of credit is a tool. And, just like with hammers and wrenches and other tools, if you mis-use them you can beat yourself silly over the head and cause huge problems. On the other hand, if you use it properly credit can get you to some great places."

Right. Credit's a privelige not a right, and I realize that credit card companies can charge me to high Hell when I use their goods and don't pay for it.

"Am I correct in thinking that using credit cards for purchases and paying them off, in full, with my debit account is a Foolish thing to do?"

I mean that I could write checks from my debit account to pay off my credit card balances. My bank charges a fee to pay bills automatically, so I'd rather write two checks a month instead of writing an astronomical amount of checks when I acquire more bills.

"For example, you mention "perks cards". Each plan has slight differences. Is there a yearly fee? How much perk do you get back for what level of spending? Do you really need the perk that's offered? Calculate the perk as a percentage of return."

I hadn't thought of this. Same goes for Cash Back cards, right--if they charge an annual fee and you don't recieve as much cash back to cover or go over the annual fee, then it's not worth it, correct?


SpeleoFool:

"If you do somehow end up with a card that charges interest even when you pay in full, dump the card and come tell us about it. It's not worth spending extra money to "build credit.""

Oh, definitely. As soon as something looks funny, then I'll talk with a customer rep at my credit card company, and if they don't tell me something I want to hear, then I'll drop them like a bad habit and tell you guys about it.

"Find one you like and apply for it. If you get denied, get your free copy of your credit report, just to be safe."

How can I request a free copy of my credit report after I get denied for a card? Can I just ask them for it, or is there a little checkbox regarding that?

""How easy" entirely depends on the companies you're dealing with. Many will let you use plastic, but beware: in my experience, most charge a fee for the "service.""

I see. In order to recoup the losses they gave away to my credit card company, correct?

"Save your money, first. You'll be much better off when you graduate if you're not saddled by CC debt. Interest and fees are unnecessary in the course of "building credit." There's also no reason to think that charging a lot is any better than charging one or two small items per month. Even if you only use your card for $30 of groceries each month (and pay in full, of course), your credit report will look essentially the same when you graduate: a couple years' history of having made purchases on a card."

I'm extremely pleased to hear this.

I intend on saving/investing my meager funds in one way or another; I've been studying DRPs and the methods of attaining one, and it looks like the route I want to take... though I'm a little unsure about how to proceed in getting one.

I'll read more about that later.

I fully intend on saving money through college; my wages now are to ensure a brighter future, even if they are small at the moment.


hbogart: I have a stationary address... probably will through my college career.

"You can actually set at least some cards up for "AUTOPAY". I have an AT&T mastercard (not an endorsement, though I've been perfectly happy with the card) that does this...the full balance comes automatically out of my checking account every month. Of course, they notify you when and how much before they pull the $$$ out! Again, this works fine if you pay attention."

I could call and inquire about this certain service?

Hmm. I believe I read somewhere on Fool that I can have my monthly cycle changed to end/start on a certain date. Anyone heard of this? Say, if I have a few bills coming in the 1st quarter of the month, when would be a good date to have credit card bills come in?

"As for the "other" advice, start saving money regularly. Even if you set aside only $5 or $10 a month, it's a good habit to get into."

Oh, yeah. Definitely saving my money... I think I can manage to save $20 a month until I get a better job, then it'll be up to around $40 or more.


TMF2Aruba:

"You can use your credit card today for most bills, and as long as you are truly paying them in full each and every monthy, then you're using their money for about a month and using the card as a tool."

I definitely plan on exploring this option. But... how would I set paying my bills with my credit cards; through an online service (I've read about paying bills online a LITTLE)?

"I agree that perks are very worthwhile. However, you want to be sure that the card you're getting has no annual fee attached. Many frequent flier programs do charge an annual fee, so you need to watch for that. Also, you've got to charge a tremendous amount to get free trips. At $1 per mile charged, it takes a lot to get a trip that takes 20,000 to 25,000 miles built up."

I don't think I'll be looking for a frequent flyer card; I'll stick to getting discounts on flights, etc.

"But most importantly, the key here is to never get in over your head. Don't get caught up by temptation or feel that a grace period will allow you to buy now and worry about it later. Discipline is very important when using the cards."

I think I have iron-clad discipline when it comes to credit cards. I know that I'll end up paying for it in full at one point, or REALLY paying for it later... in the form of 18% interest rates.

Not a problem if I pay the balance in full every month, eh?

For those of you who skimmed through this (I know who you are!), here are my main questions;

1. How can I request a free copy of my credit report after I get denied for a card?

2. Which services (Time Warner, BellAtlantic, etc.) charge a fee in order to use a credit card to pay the bills?

3. How could I acquire about an autopay service, where credit card companies are paid directly through my debit account?

4. How can I get my monthly cycle changed? Which companies will do this, and is there a fee for it? Will I have to look out for anything, such as grace periods expiring or fees for doing such things?

5. I am still unclear as to how I can pay my bills off with my credit card. Can someone please clear this up for me, and list a few options for me to try (with low or no fees)?

6. Any more advice for an aspiring Fool?


Thanks for your help, guys; you've been great thus far! I appreciate the mail as well.
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