I've honestly never owned a credit card, and I do own a debit card but I was thinking:

With a credit card you purchase X amount of goods throughout a whole month, and at the end of said month you get your bill. As I understand it, assuming you pay off your bill in entirety upon receiving it, there is no interest whatsoever.

With a debit card you purchase the same X of goods divided by the days you purchase them, with each purchase price automatically taken from your checking account.

Am I wrong in the assumption that using a debit card is actually bad business then?

With the credit card a purchase on the first day of the month is actually cheaper based on accrued interest if you're keeping your money in a money-market and prepared to pay the bill at the end of the month.

Correct me if I'm wrong.

i blame hip-hop.

is bad business.

using your credit card for everything is not necessarily a good idea. a debit card is just a substitute for cash or check, not for credit cards.


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i mean, i recognize that overusing it and buying things you normally wouldn't buy is bad, but say i'm spending $300 a month on X regardless, why not use a credit card where i could get cash back/bonuses and additionally i get the interest on that $300 for several more weeks.


*edit* also, i want to get in a fistfight with you at the reunion.

i blame hip-hop.

>i mean, i recognize that overusing it and buying things you
>normally wouldn't buy is bad, but say i'm spending $300 a
>month on X regardless, why not use a credit card where i
>could get cash back/bonuses and additionally i get the
>interest on that $300 for several more weeks.

Yup.

~~~~~~~
Just me

well first, you have a limit on it. you don't want to always have your balance up near that limit, cuz it lowers your credit score.

also, just in case something happens, you have an unexpected bill, your cash flow stops, something.

I'd rather be spending mostly my actual money, and have the CC to fall back on, than to have a balance I need to pay off or incur finance charges on, while I'm using my money to pay the unexpected bill.


what you're describing is what I do, but even then, in reality, shit happens, and theres pitfalls. Once you get into that, and you're carrying a balance, it becomes more complicated to get out from under.


edit - also, take a number, the line is getting long

FREE CHAI VANG!


Certified Grade A Coon - Inspector Abrock33


"You know why I don't have time for you?

Because I only have one lifetime to change the world, and there's not enough time in the world for me to change your life. "

a.k.a. reggie jack

http://card.mygamercard.net/lastgame/rjcc.png

www.engadgethd.com - the other stuff i'm looking at

>well first, you have a limit on it. you don't want to
>always have your balance up near that limit, cuz it lowers
>your credit score.


explain this. is that if i'm carrying a balance month to month or even within one month. ie: if i have a balance of $450 at the end of a month and I pay off every dime, does it matter that my limit is $500?

i blame hip-hop.

it only matters if you are carrying it over month to month.

:::www.frank151.com:::
Chapter 48: DOOM, your favorite supervillain

...it does matter, according to Suze Orman. It matters because if you are showing a balance on the particular day that your credit card company chooses to send info to the credit reporting agencies, then that is what will show up on your credit report, regardless of whether or not you pay off your bill every month.

In the end, it's a game of chance.

"I don't have to squeeze just to appease your dream." Lady Miss Kier

Like now I wanna cop a car so insteed of having a car note with mad interest , I can put it on my card with no interest , pay the bitch off and have my credit score looking good. Just get one good credit card and build off that. U said you have a debit, is it with a bank? If it is try to get a credit card with that same bank so you can pay ya credit bill through ya debit card. That shit is lovely cause one call and you transfer loot from ya checking account to ya credit card and it post the next day. Ups ya credit score.

DAMN!

i might look into that...

i blame hip-hop.

getting there on time and always pay more than the minimum. Like say your 0% interest rate is done and your low monthly bill is 25.00. Pay like 100.00 to 150.00 because if you pay just the low monthly fee , you're just paying the interest not the money you actually owe and it'll take you years to finish paying for the card. Also when you pay on time and frequently , ask them to lower your interest and get it fixed. What I do sometimes.....lol....is tell them I'm thinking about canceling and they be like , wanna fixed 7% interest rate...lol....gets em everytime.

DAMN!

finance charges....

is this a daily interest charge? i'm not sure i understand.

if i make $234.56 in purchases will my bill be $234.56?

or is there going to be a finance charge already built in regardless of if i have no outstanding debt?

i blame hip-hop.

I can't speak for all credit card terms, but there is usually a window permitted to pay off balances without having to worry about finance charges.

I use one of my credit cards to pay off all utilities, gas, and grocery expenses. It gives me a little more time to hold on to my cash, and I pay the balance in full without finance penalty.

The credit card is rewards based, and it pays for my airline tickets. =)

~~~~~~~
Just me

you're saying basically exactly what i'm saying.

can you explain a little further your typical payment cycle?

i blame hip-hop.

like 25-30 days after purchase. it only works in your favor if you have no previous balance over beyond the grace period. If you have a balance after the grace, then you'll start accruing interest on the daily.

~~~~~~~
Just me

your bills on time, and there's no annual fee.

what interest are you going to gain? a few dollars? credit cards are WAY too much potential (and actual) trouble to be messed with

discipline/cash to pay it off in full at the end of the month. they end up carrying a balance and paying thousands in finance charges.

but yeah, a dollar today is worth more than a dollar tomorrow.

� � � � � �
www.alienatlien.wordpress.com

i got soul.

and i'm super bad.

Putting everything on your credit card and than paying it off at the end of the month, is actually an effective way to maintain short term cash flow and generate more interest income in an Money Market.

You just need to be careful about it - additionally since the credit card company has reported your balance to the credit reporting agencies before you get your bill. You could be hurting your credit as your credit report will always show a high balance, even though you pay it off as you're paying it off and than charging it back up again between the reporting periods.

If you do this, my advice would be to pay off the balance right before the statement date. For instance, I know that my Citibank Card issues a new statement on the 9th and reports on a monthly basis whatever the balance is on the 9th, SO, if the balance is high enough to impact my credit I pay it off on the 7th.

If you pick up the Financial Spreadsheet in the anchored post, it calculates interest on credit cards for you and allows you to manage your credit card balances in a way that is the most beneficial to you.


With respect to calculating interest on a credit card balance, the basic formula is: ((APR/365) X # of Days the Interest Accrued) X Current Balance.

So if you have a balance of 163.03 and an APR of 9.90% the Interest for January would $1.37 if you didn't pay the balance in full before the Grace Period ended.

The formula would be:

(9.90%/365)= 2.712e-4

(0.02712 X 31) = 8.408e-3

8.408e-3 X 163.03 = $1.37

There are Brokerage Houses, Investment Banks and Retail Banks with high end Cash Management or Brokerage accounts that give you an account with Debit and Checking priveleges and a money market sized interest rate, the money isn't debited from the account until the end of the month, thus allowing you to earn more interest.

How much you can spend (of course) is limited by how much you have in the bank.




Peace,








M2

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>There are Brokerage Houses, Investment Banks and Retail
>Banks with high end Cash Management or Brokerage accounts
>that give you an account with Debit and Checking priveleges
>and a money market sized interest rate, the money isn't
>debited from the account until the end of the month, thus
>allowing you to earn more interest.


Appreciate it.. Got any links?

also, i checked the spreadsheet for a sec but i'm not sure i exactly follow. i'm gonna look at it further later.. i'm in a really good financial situation right now (no debt, good assets for my age, good potential income) and mostly i want to maximize it. i figure if i start doing this, not only will it help me monetarily but will also help continue a pattern of behavior.

i blame hip-hop.

paying off a credit card with a credit card is supposedly terrible...

but say you have 12 credit cards.

A you use to purchase goods.

B you use to pay off A.

C you use to pay off B.

D you use to pay off C.

Etc.

What is stopping you from getting a free loan for a year? I mean sure you're going to have to be pretty meticulous in timing and paperwork, but essentially you'd be getting a full 3% (assuming your money is in money-markets) discount on everything you buy.

if you're able to pay your rent with a credit card suddenly $500 a month is $485.

can you do this? i mean, what's stopping you here?

whether or not it's worth it is a different, and pertinent question, but what's stopping you?

i blame hip-hop.

most credit cards have balance transfer charges, of either 3% or $50, usually whatever is higher. So everytime you are transferring a balance, even if its you're transferring it from a 0% interest card, you still pay a finance charge for the transfer to go through, so its not really a 0% balance transfer. If you were to transfer this from card to card, 10-11 times a year, you would be paying exorbitant finance charges. It would be cheaper to just have a fixed rate card of 2% or so.

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to pay a card with a card.

i figured there was a way that this didn't work, just didn't know how.

i blame hip-hop.