moana posted:

I suppose I was thinking that all of the daily transaction commissions would more than overwhelm the interest. Maybe that was true when I got my first credit card, but I really don't know what it is now. You're probably right.

"froglet" posted:

The problem with common sense is that it isn't that common. Financial literacy isn't taught in schools and the entire credit industry is based around convincing people that they can "afford the payment" rather than letting them realise how much they'll be paying in the long run if they pay out the minimums only.

I'd be interested to read a 'dumb financial decisions' thread. Like a mini-version of zaurg or tuyops thread just for one-off dumb decisions to serve as warnings to other goons. I've got heaps of stories from my previous jobs in retail about the various credit traps on offer and I'm sure there's plenty of people out there who have tales to tell about how one bad decision they made later on hit them hard in the wallet. Then again I'm sure anyone who visits here already knows about the different ways you can screw up your life/credit score or at least can figure it out on their own.

"zelah" posted:

I currently have a BoA credit card with a $0 balance and 5,000 limit. This is my only card.

In response to their future debit card fee crap, I've opened up an account with a local credit union. They have a "Platinum Rewards Visa" at 9.9% APR that the lady I opened my account with said my credit would be more than good enough for. Should I go ahead and open a card with the credit union? Would it hurt to have 2 credit cards?

Kontradaz posted:

I'm in college and just got a part time job. Gonna be earning about 500 bucks a month. What type of budget should I make and how much should I put aside in my savings? I really feel like if I don't do a budget or something I'll be wasting all the money away :\

Rageaholic Monkey posted:

Okay, cool. So basically keep doing what I'm doing now (buying only one thing per paycheck that I can afford), but do it on a credit card in order to build up my credit standing?

dunkman posted:

Back in 2007 when I had no credit (college kid, never needed it) I got a BoA visa ($500 limit, $29/yr, 19.9% apr) and a Capital One Mastercard ($500 limit $45/yr 21.49%), and a Exxon gas card thing that had no fee and I actually lost it after 2 months, paid the balance down to zero and they just closed it like 6 months ago. Also last December, Capital One increased my limit to $2000.

Since July of this year, I got an Amex Charge Card ($50 fee, no apr) and also a USAA Amex credit card ($3000 limit, 17.49% apr, no fee).

I just did a balance transfer of my existing balance on my CapOne card to my new Amex credit card. My balance is about $1100 and I'm paying that down fairly quickly. None of my other cards have balances. Well, my charge card does, but I use it like cash since I get crazy rewards and don't spend more than I make or whatever.

Should I close my Capital One and BoA cards? I don't need a higher credit limit really, and the new Amex one is bigger than those two old ones combined. I'm just not sure of the impact on having credit lines almost 5 years old get closed, etc etc etc.

SlightlyMadman posted:

Right, I didn't mean to say BoA was unusual in that regard, just that "leave your money in a crappy savings account and wait for interest rates to go back up" is probably not good advice.

Fancy_Lad posted:

This is how I do it. Note that if you have some flavor of "free" checking with your physical bank, they often tie a minimum direct deposit amount to that account or else they charge fees. For instance, the Chase accounts I use require a minimum $500/month deposit for it to remain free.

Ashcans posted:

Oh man. Part of me wants to tell you to take the trip, because you have so many other issues looming that at least that way you would have some good memories to warm you when you are sleeping in a shanty.

Harry posted:

Having debt doesn't hurt your score unless it's just a ton. Just have her get current on her accounts, and then work on paying everything down.

Freeze posted:

Sorry man, that's a really lovely situation.

As a side note, you're absolutely right that splurging is okay sometimes. It's very difficult to find the balance between saving money to have fun when you're retired, and having fun now. The majority of people probably don't save enough for their retirement, but the flip side (seen much more regularly on financial forums) is really not all that much better a situation to be in honestly.

Zeta Taskforce posted:

What are the nature of your other expenses? What are you paying for rent, what are typical utiliity payments and food bills? Anything unique going on, like super long commutes, regular travel, health care expenses for a cronic condition? Its better if you can come up with what you really spent by looking at receipts, bank statements, etc rather than imagine what you want your perfect monnth to be.

We can talk about the order to pay the debts, but that is a small point.

Zeta Taskforce posted:

On food, $500 to $1000 is a big range. If it is closer to $1000, your food budget is high for 2 people. I assume this is eating out/not cooking and where the microbrews come into play. What are your cars worth?

Hashtag Banterzone posted:

You can use kbb.com to figure out how much they are worth.

Have you considered cutting cable? Since you have netflix you might not even miss it.

Also, what is the interest rate on your car loans?

The $1,860 loan should probably be first to go since it is so small.

How would you feel about using the $8,500 investment to pay off some of your debt?

Zeta Taskforce posted:

Well, that is a big part of the solution there. Your family in order to be nice to you bought you a crappy whole life insurance policy, and because your family has been overcharged for years, the insurance company has been putting some of it into a crappy savings account. Whole life insurance is a rip off in so many ways, but the insurance industry has convinced people that it is this miracle thing that grows and helps you plan for the future. I'm curious how your numbers crunched out, because everyone else is so much better off investing on their own in a real investment, like mutual funds in an IRA, and buying term insurance, where you can get hundreds of thousands of coverage for the price of a couple craft beers.

Use that money to pay off your debts and cut back lifestyle by cooking more and drinking less, and suddenly your budget and your body will get healthier simultaneously.

HooKars posted:

Fellow Philadelphian with the same problem -- why do great beers and food have to be everywhere here??

Do you guys both work out in the suburbs of something? I don't miss having a car at all in Philly - it's an extremely walkable city. At this point, I really can't even imagine the hassle of dealing with parking or the drivers.

Hashtag Banterzone posted:

I figured you weren't looking to sell the cars, but you should still know what they are worth.

Definitely understand on the cable+internet vs internet alone thing. Though I would suggest calling comcast and doing the whole threatening to drop cable act to see if they will give you a discount.


You also might want to figure out if you actually need life insurance. My work would pay 1 year of salary if I were to die, you should see if your work has something similar. Since your wife can work and you don't have kids, that might be all you need right now.

Zeta Taskforce posted:

How old are you and are you in reasonably good health? 20 year level term doesn't start getting expensive until you are in your 50's.

Sophia posted:

If this is true I'd just get the insurance. If your work's coverage is dirt cheap it's probably not that high and given even your not-insane debt loads it would better to be slightly over-covered than under-covered until you're clear of all of that. A 20 or 30 year term policy will probably never be cheaper for you unless you're a really bad driver or something. You can always stop paying for it once you no longer need the extra coverage.

infinity2005 posted:

Hi, I really need some help for my close friend of mine. I'll try to explain and any advice would help, although i'm not sure if this is better for E/N. She 24, lives in the Philippines, and her Aunt, who lives in California, is advising her to move over there and study. The Aunt doesn't appear to have any longterm plan for her in terms of help or anything other than telling her to get to the US. Now from everything i've read on this board i'm pretty sure this is a terrible idea due to the state of things over there economically and especially for the poor.. but i feel like she might just think my feelings on America are clouding my judgement.

I would just like some sound explanations of the finances involved for someone totally alien to the situation, or some links or anything to try and show the facts other than just her Aunt's vague advice that sounds like its well out of date. If i'm wrong then i would like to know as well, maybe i am biased but i'm genuinely worried after everything i hear. Hope this isn't too much of a vague question for this forum. Thanks.

Emacs Headroom posted:

Yeah that's great. My wife got really into following some recipes on freezable food, which is seriously great for the winter (and I got into it also). It kept our food budget around $300 during our lean years; I can ask her the books she'd recommend if you think they'd help.

It's healthier than grocery store frozen food, massively cheaper, and really accounts for the lazy "let's just order something" or "let's get a frozen pizza tonight" factor.

DemonLlama posted:

Duckman: Unless your car loans are more than 6%, throw the whole thing at the student loan and just get rid of it. It'll really make you feel better actually getting rid of a payment.

Brennanite posted:

We have been working through things for the last two days. We worked out a thorough budget which we *both* went over in detail and which he committed to following. It's got a decent amount going to build up savings for the next four months, then to paying off the credit card. I feel a lot less stressed about money now. When he saw how much of the budget he was taking up, he felt really bad. I guess he really didn't understand how things were until he saw them in front of him. He will still be getting a new computer, but a much more reasonable system at Christmas paid in full with the money he will get from selling some of the older games and his current system (plus his parents agreed to kick in some in lieu of birthday/Christmas). I honestly didn't think he would sell anything, but as I said, he felt really bad when he saw the budget.

zharmad posted:

You only will owe taxes if the cash out exceeds the amount you paid in. Whole life/universal life is such a terrible return you will likely have no tax liability. (Also assuming it isn't a modified endowment contract, which changes the rules somewhat.)

swenblack posted:

He's made 20% in 20 years. At this point, he's better off getting his money out of this "investment" as soon as humanly possible. It'd be worth any sort of penalty if he could roll it into a Roth IRA in either his or his wife's name. If he's maxing both out currently, even putting it in a savings account with today's lovely rates would yield a better return.

zharmad posted:

Also, if it had been invested in a S&P index fund over the last 20 years, lump sum with no additional money added, it would have compounded to about $47,000 at this point.

SlightlyMadman posted:

I'm going to join all the people here asking for financial advice in their relationships. My girlfriend moved in with me about a month ago, and she's pretty badly in debt. She only works part time and basically even with me not asking her for any household expenses, she's barely making minimum payments. Most of it is student loans, I'm not sure how much but it's probably five figures at around 6%. She's still got a couple years left in grad school though, so those are in deferment (although apparently some still collect interest). That's less of a concern though, next to her credit card debt. I'll be getting more details from her tonight, but it's about $4500 at something like 15% interest.

She's pretty responsible with her money, but the credit card debt is mostly from school expenses. We've been talking, and I'm worried about her debt getting worse if something isn't done about it now, so I'm considering paying off her credit card with either my savings or from my HELOC (3.5% and tax deductible).

The main thing I'm worried about is how to handle something like this without it building any sort of weirdness or resentment into the relationship. I think we'd probably both feel most comfortable if it was an officially documented loan with a term and minimum payments.

SlightlyMadman posted:

I don't mean to be a dick because I know you're just being helpful here, and I do appreciate it, but honestly that decision is my business and I'm not really looking for input in that area.

SlightlyMadman posted:

What would be really useful is if there was a third-party organization like lending club or something that I could go through to make it an actual official loan.

Zeta Taskforce posted:

DON'T DO THIS!!!

DemonLlama posted:

Its a terrible idea.

Hattusa posted:

I've heard that major banks like Chase process transactions in batches ordered from smallest to largest. Why? Because paychecks are often relatively large, which means all those $5 Starbucks coffees go through first to rack up their $30 overdraft fees while you're "overdrawn".

Welcome to modern banking.

Cicero posted:

On a related note, do people usually factor in unemployment payouts into their emergency fund? To me it seems logical to include that, but I guess you could exclude it on the basis that it's not strictly guaranteed (e.g. you could get fired with cause and be denied benefits).

Discospawn posted:

FrozenVent posted:

Your emergency fund is supposed to earn a rate of return like airbags are supposed to make your car go faster.

Hughmoris posted:

What is the easiest, most painless way to check my current credit score? Everything I look at wants me to sign up for a "trial period" which is a pain in the rear end to cancel.

martyrdumb posted:

Does Chexsystems follow you around forever? I thought this poo poo was supposed to go away after 5 years. But I just got declined when I tried to open an account with Charles Schwab online. I did have a Fifth Third account that was overdrawn by $4 back in 2006 or 2007 and ended up getting charged off because I refused to pay over $200 in overdraft fees (due to their reordering of transactions which actually got them to settle a class-action lawsuit in 2011).

I just ordered my report from them. I thought that would be gone by now. Banks don't care about your credit score, just chexsystems, and I haven't had so much as a single overdraft in at least 6 years.

Zyme posted:

My parents have took out a whole life insurance policy on me when I was born and have been paying into it ever since, and have taken money out of it at various times to do lord knows what. They are now offering to give it to me to do what I want with it. From what I can tell, it has a monthly expense charge of $5.00, and the "cost of insurance" for me is currently $19.71 per month, which increases every year. The guaranteed interest rate is 4.5%, which is what the current interest rate is, not surprisingly. The death benefit is about $200k, and the cash value is $1,885. If I didn't put any more money into it, it would apparently last another 10 years, or so the latest policy statement claims.

Now, I have absolutely no need of any life insurance in addition to what I already get through work for free and my retirement savings. The only use I can see for this would be to put my emergency fund in it, which would draw a substantial amount of interest beyond the monthly fees, and presumably I could cash it out if I ever needed it. There would also certainly come a point at which I got old enough that the cost of insurance would outweigh the higher interest than I could get vs. a savings account.

My initial inclination was to just cash it out and give it back to the parents to go on a vacation, but they seem to think that it is something I should keep instead, and the fees do seem pretty low. I've tried to do as much research as possible on what whole life insurance is, but there seems to be a lot of variation and I haven't actually talked to the "agent" yet. Would there be any value in holding onto this, maybe as a place to get a better return on my emergency fund, or something else?

T. J. Eckleburg posted:

$450 - Rent and bills
$100 - gas/routine car maintenance
$250 - groceries & stuff like soap, TP, etc.
$250 - restaurants, bars, coffee shops, soda at the gas station, etc.
$100 - spending money (clothes, gifts race registrations, gym fee, etc.)
------
$1150