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I'm 23, I have no debt and I know nothing about credit cards/establishing credit. Up until March of this year my parents have supported me financially in all aspects. I moved away, they co-signed for an apartment and I got a full time retail job and have been paying my bills and living paycheck to paycheck successfully. However, they continue to pay for my car insurance and gas, but come August, I'm most likely going to be in charge of that too. I'm worried about not being able to afford the extra load. What do I need to do to start establishing credit? What's a good source for a complete newbie like me? I don't even own a credit card. Half the terminology you guys are using I don't understand 
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Jul 18, 2011 19:03
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Go to the bank or credit union you use and ask to apply for a credit card. Try to get a regular credit card with no annual fee, but if you don't qualify you might have to get a secured credit card. That's when you give them, say, $500 and basically use your CC like a debit card to prove that you're responsible enough to be given actual credit. Eventually you will qualify for a normal credit card. Start saving now if you're worried you might be in a bind later. Get yourself enough of a buffer that you feel ok for at least a few months.
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Jul 18, 2011 19:24
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Dead Pikachu posted:I'm 23, I have no debt and I know nothing about credit cards/establishing credit. Up until March of this year my parents have supported me financially in all aspects. I moved away, they co-signed for an apartment and I got a full time retail job and have been paying my bills and living paycheck to paycheck successfully. However, they continue to pay for my car insurance and gas, but come August, I'm most likely going to be in charge of that too. I'm worried about not being able to afford the extra load. You don’t have to look that hard in this thread to learn how to establish credit, but the way you worded your question you makes me worried. Well not personally because I have no skin in the game. But for you. To be frank, it sounds like you are planning on using credit as a crutch because in August you won’t be able to afford your current lifestyle. All of us at one time or another have depended on credit when too much life hit us all at once, or take care of one off events. We can debate if debt is always evil or only sometimes evil. But I think everyone would agree that using debt because you can’t afford reoccurring things like car insurance and gas is a problem. Are you on a budget? How much do you make? What are you spending money on now?
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Jul 18, 2011 19:26
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illcendiary posted:drat, really? If I just add a few charges onto each of my "inactive" cards, are they magically considered "active" again? Yes, using them again makes them “active”. As inactive accounts, it’s not that they stop counting, but it’s just that they are not weighted as heavily somehow.
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Jul 18, 2011 19:40
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Inverse Icarus posted:There's a little lag when the stocks get purchased and become available in your account, but it's a day or so in my experience. Yeah, I've run the numbers and since I'm pretty small time money-wise it's worth it just to sell it the next day and not take the risk. Sure the stock could appreciate in value but I'd rather just have a steady 10-12% return every six months. Comes out to a couple grand a year or so.
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Jul 18, 2011 20:34
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Dead Pikachu posted:I'm 23, I have no debt and I know nothing about credit cards/establishing credit. Up until March of this year my parents have supported me financially in all aspects. I moved away, they co-signed for an apartment and I got a full time retail job and have been paying my bills and living paycheck to paycheck successfully. However, they continue to pay for my car insurance and gas, but come August, I'm most likely going to be in charge of that too. I'm worried about not being able to afford the extra load. Do up a budget. I would be less worried about the credit and more about the living paycheque to paycheque. I think it would be a good idea to know how much you are bringing in vs what your expenses are. That is the only way you will know if you can afford it or not come August. Until you do that it's pointless to worry about it because you don't know if you can or not. If you don't have those numbers, start tracking them or get them from your parents. asmallrabbit fucked around with this message at 20:40 on Jul 18, 2011 |
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Jul 18, 2011 20:35
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Just mailed my final car payment. It feels so good!
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Jul 19, 2011 03:00
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Omne posted:Just mailed my final car payment. It feels so good! Congrats! Do you have any other debt? Get cracking on that! 
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Jul 20, 2011 14:30
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So HSBC is threatening me with collections again. I owe $794 on a closed credit card account. I need $119 just to bring it current. The fun part is I have next to no income (about $30/week) and no way to pay them. 
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Jul 20, 2011 23:56
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devmd01 posted:Congrats! Do you have any other debt? Get cracking on that! You don't even want to know...
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Jul 21, 2011 00:01
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Omne posted:You don't even want to know... Why did you stop updating your blog and posting in the MBA thread? Since you've graduated we need an update on how it all ended up.
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Jul 21, 2011 00:15
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Ganon posted:Why did you stop updating your blog and posting in the MBA thread? Since you've graduated we need an update on how it all ended up. Haha, I didn't think anyone read that! I'll pop into the thread to give a recap of the second year/job search, but I think the blog is dead.
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Jul 21, 2011 01:22
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Rurutia posted:Discover Savings seems to be 1.15% which is barely better than SmartyPig. I never see this mentioned but I figure it's a common enough membership that people should take note - if you're thinking of doing the Discover Savings Account and you belong to Triple A - be sure to try to go through the Triple A website first to open up your savings account. Although it doesn't apply to certain areas of the country (Im in the Midatlantic and it works for there), many Triple A members get an extra .05% on savings accounts/cds from Discover so 1.2% at the moment for their savings account.
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Jul 21, 2011 15:46
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Sorry if this seems incredibly obvious to you guys, or if the exact advice I'm looking for has already been posted somewhere in this forum and I missed it. Basically, I'm considering a couple options to reduce or eliminate my non-student loan debt. My relevant numbers are like this (right now these are close approximations, I am studying for the bar right now and I haven't sat down and crunched these numbers exactly). debts --about 90k in federal student loans because I went to law school because I was a special snowflake (don't do this) --approximately 14k in credit card debt split among three cards, 2 of which have around 25% APR. --currently in the grace period of a 12k bar loan that is due to begin repayment in 4 months, variable rate (certain amount over prime, I can get the details if needed) but its currently at 8.9% --about to finish paying for my car, my car loan is due to be paid off in january, I owe about 1,000 left on it. --my dog had to have very expensive eye surgery which is about to be paid off, the total bill was over 4k but I only have about 300 dollars left of payments. assets --ING Variable Annuity valued at 49k. --I own a vacation property in Michigan's Upper Peninsula with my brother, my next order of business is to actually obtain the deed (it was left to us by our dad) and see how we own it (joint tenancy or tenancy in common). It's unencumbered but has not been recently appraised. At one point it was appraised at 105,000. --I start a job on August 15th that pays 50k/yr. My basic question is, should I just take money from the annuity and pay off (at least) my credit cards? The annuity basically has not made any money while I've had it, it dropped significantly in value with the market and came back to basically being valued at the level of the money I paid into it. According to the person at Oppenheimer I've been dealing with, this is supposed to be a long-term investment for my retirement and it contains various provisions which I need to analyze, such as apparently being "guaranteed to double in 10 years" that I don't currently understand. This was bought with money from my father's estate on his recommendation, I was a basically a kid at the time (22, I'm 31 now) and didn't question anything. I don't think I would have chosen this instrument now because of the administration costs and because honestly something more liquid would probably have worked better. I have discovered that I can withdraw money without an actual "penalty" other than a tax withholding, however as this was bought with money that was paid to me as distributions from my dad's 401(k) and I'm pretty sure I already paid the taxes on it. This year has been my final year in law school and I have made very little money, I only had a student clerk job at 20 hours a week, 10 dollars an hour for half the year. I'll make some money when I start my law job, but since I'm married and my wife is in graduate school, I'm hesitant to just keep chipping away at our debts with pay, especially because we have basically no savings and no open credit lines. My idea was to take a distribution from the annuity and pay (at least) the credit cards, which would leave approximately 30k in the account and eliminate the really high interest debt. Does this seem like a good strategy? I had also considered looking into a mortgage on the vacation property and using the money to pay off all other debts than the federal student loans, which I hope to manage with IBR and public-interest loan forgiveness since I work for the state government. But I'm hesitant to encumber the property and a lot of factors would have to considered before going that route, including if it is even feasible or doable. Sorry for the length, I would really appreciate any advice. I've spent a good portion of my adult life being careless and/or unthinking about my financial situation, and I'd like to change that. J Miracle fucked around with this message at 04:29 on Jul 22, 2011 |
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Jul 22, 2011 04:27
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A VA doesn't make sense for you. Cash it out, pay off the credit cards. Also try to sell your part of the vacation home.
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Jul 22, 2011 12:08
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Chin Strap posted:A VA doesn't make sense for you. Cash it out, pay off the credit cards. Succinct, but I agree. You want to simplify your finances here, you have a lot going on in a period of time where you should be setting solid roots. A VA doesn't make sense (for mostly anyone) and holding it would incur opportunity costs as you could reinvest the money wiser and cheaper, or pay down debt (the preferred choice in my opinion). Unless you guys have an emotional attachment to that property in the UP, do what you can to offload it. The UP isn't appreciating rapidly, and you can always go back and buy a house up there when your finances are strong that suits your needs, not your fathers. Best of luck!
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Jul 22, 2011 13:15
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Thanks very much guys, I'll take your advice about the VA...my wife and I actually ARE pretty attached to the property and spend time there in the summer so I don't think I'll be selling it, but I appreciate the advice. It's been in the family a long time and all that. The VA though, maybe I should just sell it and pre-pay off my bar loan too? I would still have a piece of it left after that that I could stick in savings/money market. EDIT: Bar loan has no prepayment penalty.
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Jul 22, 2011 15:23
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J Miracle posted:Thanks very much guys, I'll take your advice about the VA...my wife and I actually ARE pretty attached to the property and spend time there in the summer so I don't think I'll be selling it, but I appreciate the advice. It's been in the family a long time and all that. The VA though, maybe I should just sell it and pre-pay off my bar loan too? I would still have a piece of it left after that that I could stick in savings/money market. Do your other loans have prepayment penalties? Unless you're having cash flow issues, I'd recommend applying 100% of the VA (less any amount needed for taxes, but I don't believe there should be any) toward debt. Get yourself lean, so that way everything is less stressful.
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Jul 22, 2011 17:43
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I'm 21 and I've made some really poor choices since I was 18 and needless to say I have learned my lesson. I've tried moving out twice and racked up debt both times. Debt -Around 14K in student loans, but I have paid for the past few classes on my own so this may change when I transfer to finish my bachelors this spring. They already want to start collecting since I'm only taking one class (if I can afford it). I applied for a deferment because I'm unemployed. -Credit Cards: I have $1,800 spread across 3 cards. One is a Dell card for a laptop I got when I moved, The other 2 are a discover and Fifth Third Card with $500 limits. Discover is maxed out and the other is very close. -Sprint ETF Fee $130.00. I closed my sprint account because they wouldn't replace my broken Palm without paying $100 bucks so I just cancelled my contract with them. I plan to take care of this first. -Unpaid Rent and Damages $2,500. When I was 18, I moved out with friends and I lasted about 5 months and went back home. One person stayed on the lease and since my name was still on it, he trashed the property and didn't pay 2 months worth of rent, so they went after me, and the other 2 people on the lease. I refuse to pay anything, so it's just sitting on my credit report and they occasional try calling me, but I haven't spoken to them in almost a year. Since I forgot to take my name off the lease, I got screwed. I thought about fighting this but I don't even know where to begin. I really have no assets at all, except a Roth IRA I started last year which has only $690. I have a car that's in my fathers name, but he's helping me until I get on my feet by making payments, we are probably going to sell it. Got about 2 years left on the payments. I'm unemployed and because I was fired from my last job and I didn't qualify for benefits. I'm back at home and my parents are supporting me the best they can. I managed to get an interview with a local PC repair shop and said they are would like to bring me on in two weeks if everything goes as planned with their opening of a new store. I'm not taking this as a 100% guarantee, so I'm still looking for work. My only source of income right now is doing side jobs for a rich realtor that my father knows, like staining docks/garage floors, pulling out shrubs and other manual labor stuff for $9 hour cash. I just started this the other day and I was told he can give me around 20 hours a week. It's something at least. I'm trying to get rid of my laptop since I don't even need it now that I am back home. Also, I may just get off my friend's Verizon plan since they recently made a change to their contract and just get a pre-paid phone. I'll most likely pay off my discover card after that sprint bill since that has the highest APR right now. I realize that due to some really poor planning I've put myself in a huge hole and I want to get out before I get any deeper. Any advice would be appreciated.
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Jul 25, 2011 19:50
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MalConstant posted:I'm 21 and I've made some really poor choices since I was 18 and needless to say I have learned my lesson. I've tried moving out twice and racked up debt both times.
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Jul 25, 2011 20:15
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MalConstant posted:The good news is that so far you have not dug yourself into that much of a disaster. The bad news is its because 3 years isn’t long enough to dig an enormous hole as much as you have tried to dig. You have bought things you don’t need on credit, signed your name in lots of places where it has come back to bite you because you were not paying attention. If you start a thread, you will have my blessing. But you will have to stick with it. It must be said that you may get conflicting information, trolls, and goons who know little more than you do try to give you advice. We have a mixed record with these personal finance logs, but they are not for the thin skinned. It goes without saying that you need to be on a written budget, you need to get yourself current on any accounts that are still open and have not gone to collections, make just minimum payments until you build up an emergency fund. I don't care if they are at 29% and it takes you an extra couple months to pay them. It wasn't 29% that created the hole you are in, it was a pattern of behavior and this is what you need to change. You are practically unbankable which means that you won’t be able to get a loan or a new card if you need money, having money in the bank is the difference between something being inconvenient and something being desperate. When it comes to finances, desperate and stupid are joined at the hip and desperate is what sets people up to bounce from crisis to crisis. You can change this, but if you don't the only difference between a $5000 hole and a $50,000 hole is 5 years.
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Jul 25, 2011 21:51
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place fucked around with this message at 04:53 on Feb 10, 2017 |
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Jul 26, 2011 00:53
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edit: nm
Nocheez fucked around with this message at 01:08 on Jul 26, 2011 |
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Jul 26, 2011 01:05
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wacky posted:Tomorrow, I'm going to default on my credit card. I'm floating close to max and fees will push me over my limit. Going over your limit is not at all the same thing as defaulting but will have a minor to moderate negative impact as a maxed account in good standing.
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Jul 26, 2011 13:46
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place fucked around with this message at 04:53 on Feb 10, 2017 |
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Jul 27, 2011 00:18
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Is there any consensus on whether or not renter's insurance is worthwhile? It came up because my girlfriend and I are moving and were ordering a U-Haul and considering getting U-Haul's insurance ($15). It was suggested to get renter's insurance as it would cover the move as well. Is this worth it? I got a quote that comes out to $111/year (~ 1% of yearly rent + utilites). That seems really cheap but we don't own that much stuff and the area isn't prone to natural disasters or anything. Any advice? I'm having a hard time doing the cost-benefit analysis.
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Jul 27, 2011 02:06
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Yes it is worth it, and in fact, many of the apartments I've been looking at require you to have it.
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Jul 27, 2011 03:22
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Renters' insurance is cheap enough that you should get it, even if you don't live where there are lots of natural disasters. Fire and robbery can and do happen in all kinds of places. You think you don't own that much stuff, but take a second to look around you and imagine replacing literally everything in the room, electronics, clothing (your entire wardrobe), furniture, books, housewares... Yeah, it's a lot more than you think. Maybe not the $20k your policy offers, but not so far off as to be cavalier about it, either.
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Jul 27, 2011 03:48
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theDoubleH posted:Is there any consensus on whether or not renter's insurance is worthwhile? It came up because my girlfriend and I are moving and were ordering a U-Haul and considering getting U-Haul's insurance ($15). It was suggested to get renter's insurance as it would cover the move as well. Is this worth it? I got a quote that comes out to $111/year (~ 1% of yearly rent + utilites). That seems really cheap but we don't own that much stuff and the area isn't prone to natural disasters or anything. Any advice? I'm having a hard time doing the cost-benefit analysis. My building requires it. It has some good stuff, like if my bike is ever destroyed (in an accident while I'm riding it, or a car smooshes it while parked), or it is stolen from my building (possibly from elsewhere too) it is covered. It also covers my wife's and my wedding rings against loss or theft. Hufflepuff or bust! fucked around with this message at 04:03 on Jul 28, 2011 |
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Jul 27, 2011 15:42
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wacky posted:Tomorrow, I'm going to default on my credit card. I'm floating close to max and fees will push me over my limit. I know you asked this a few days ago, but you deserve some gentle picking on. It is also a teachable moment, so I don’t mention anything out of meanness or of a hope that you get trolled. I hit the little question mark by your name to see the previous posts you made in this thread. The way I’m reading it is you are on the edge, but you have been on the edge for so long it doesn’t feel like it anymore. But when you have non existent savings and so little access to cash that a check that hasn’t arrived snail mail threatens to have a credit card blow up in your face, that is by definition living on the edge. Reading your previous posts, you are full of optimism that you will eventually start to pay off this debt. I hope you can, and obviously having a paycheck will help big time. That said, you have to be intentional about this. Its not hard to find people who have been working and getting paychecks for 5, 10, 25 years and still have tons of credit card debt. They are called “normal”. Life will continue to happen, there will always be a more hopeful tomorrow when you will be making more money, when there isn’t as much going on, etc. Frankly reading your story, I’m not agreeing 100% with your priorities. I’m getting whiplash as you are excited that you have good credit, then worried that it might not be good, then afraid it’s not good enough to get an apartment, but then optimistic that your dad’s is. You are not particularly concerned with your debt amount. However it is a vastly greater concern that you are utilizing 99% of it, which again your primary concern is how it looks on your credit. Even now, I’m not sure you are learning the right lesson. You are relieved that this will not be a devastating blow to your credit. The fee and what they will do to your rate are almost incidental. Meanwhile you jerk back from crisis to relief, back to general worry. So I hope you can pay this, that you think more about your finances and less about your credit, and depend on yourself to provide, not depend on FICO to provide. Of course if I'm wrong about anything let me know.
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Jul 27, 2011 17:24
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kaishek posted:It also covers my wife and my wedding rings against loss or theft. Is it expensive to find insurance that covers lost/stolen wives? Seconding (thirding... fourthing maybe) renter's insurance. You never realize just how much poo poo you own until you have to replace it all.
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Jul 27, 2011 19:22
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Dragyn posted:Is it expensive to find insurance that covers lost/stolen wives? Very, the risk of fraudulent claims is incredibly high.
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Jul 27, 2011 19:45
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Zeta Taskforce posted:The good news is that so far you have not dug yourself into that much of a disaster. The bad news is its because 3 years isn’t long enough to dig an enormous hole as much as you have tried to dig. You have bought things you don’t need on credit, signed your name in lots of places where it has come back to bite you because you were not paying attention. Thanks for the advice. I'll start a thread once I get a reliable source of income, which is hopefully very soon if these interviews work out!
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Jul 27, 2011 20:44
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theDoubleH posted:Is there any consensus on whether or not renter's insurance is worthwhile? It came up because my girlfriend and I are moving and were ordering a U-Haul and considering getting U-Haul's insurance ($15). It was suggested to get renter's insurance as it would cover the move as well. Is this worth it? I got a quote that comes out to $111/year (~ 1% of yearly rent + utilites). That seems really cheap but we don't own that much stuff and the area isn't prone to natural disasters or anything. Any advice? I'm having a hard time doing the cost-benefit analysis. It's important to note that the type of coverage offered by U-Haul and other moving companies is different than renter's insurance. The former covers damage to your items no matter how the damage is caused, as long as it happens during the move (e.g. that bookshelf didn't have that gouge in the back before it went on the moving van). The latter only covers items that disappear during a move, i.e. you paid two guys to move your stuff and the van never showed up at your new address. You would only get money paid out after you filed a police report. The info I have is from my Allstate insurance agent, so other companies it might be different. In any case, renter's insurance is totally worth it. You wouldn't pass on home insurance if you owned a home, why would you pass on renter's? It's worth the peace of mind.
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Jul 27, 2011 22:28
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Something I just discovered and felt the need to share: If you travel abroad with any frequency or at any length, you should look into getting a Capitol One card, as they don't charge any currency exchange fees or international ATM withdrawal fees for their credit and debit cards. That makes a HUGE difference, between constantly needing to find ATMs affiliated with your US bank and being able to use your card whenever you want. Just signed up for one of their rewards cards as my second credit card today. I hear mediocre things about their fraud claims department, but that's probably true for any major bank these days.
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Jul 28, 2011 02:15
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baquerd posted:Very, the risk of fraudulent claims is incredibly high. Har har. Fixed =P. Sad that I missed that as fixing grammar is all I do all day.
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Jul 28, 2011 04:04
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How irresponsible is it to spend a bit more on rent as a new graduate? I'm 23 and I've just recently started a new job with a salary of ~$4800 net. Its my first post-graduate job and I'm living in a fairly expensive city in western Canada. I give an approximate figure because it will vary depending on the amount of work availible for my company. 30% of my net for rent is slightly over 1400, but obviously that is quite high - especially for a 1 bedroom apartment. However, there are quite a number of nice upperclass condos and such with great downtown locations in this ballpark area. Alternatively, I would pay ~900-1000 for an average place with an inferior location. Basically, I'll be paying around ~$5000 extra a year for rent for a more enjoyable quality of life / social life versus saving it (I'm fortunate enough to be debt free - it could be my TFSA contribution for the year). I have a generous amount of investments compared to my similar aged peers, and I don't generally consider myself to be a reckless spender. I know I'm not making a smart financial decision by paying that much for rent, but there are many young professionals who do the same - is there really any way to justify it? Are young people just that irresponsible with money - or should I spend a little more to enjoy life while I'm still young? Pieces fucked around with this message at 22:32 on Jul 28, 2011 |
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Jul 28, 2011 22:30
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My rent is ~35% of my net pay (in Chicago). I could probably live in a cheaper place, or have roommates, but I have no debt and still am able to save money with this rent price so I've never had a problem with it. Where I live is important to me, so it's worth spending the money there and spending it less on other things. Depending on your financial situation, it should be easy to pay a slightly higher rent for what you want if you're willing to adjust your spending otherwise. And living in an expensive city can change the general "rule of thumb" on how much of your paycheck to spend on housing anyway.
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Jul 28, 2011 22:36
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Pieces posted:I'm 23 and I've just recently started a new job with a salary of ~$4800 net. Its my first post-graduate job and I'm living in a fairly expensive city in western Canada. I give an approximate figure because it will vary depending on the amount of work availible for my company. You'll want to take a hard look at your ability to do this job and how that weighs in on your long term prospects. Most companies that pay that much to fresh graduates expect top performance.
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Jul 28, 2011 22:38
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baquerd posted:You'll want to take a hard look at your ability to do this job and how that weighs in on your long term prospects. Most companies that pay that much to fresh graduates expect top performance. Its with a service company in the Oil & Gas sector - I have no worries about my performance or with the job. Long term prospects are alright as well as long as I am alright staying within this industry - I asked a similar question in the 'Ask Me About Being An Engineer' thread with respect to that.
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Jul 28, 2011 22:42
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