this post was submitted on 02 Jun 2024
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A Boring Dystopia
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I mean responsible card owners pay their statement in full every month. It's a great way to get purchase protection and cash back or reward miles. This is more like splitting payments over multiple months, and if you do that with a credit card APR you're getting a terrible bargain.
I just got a credit card to build credit. I've never had a loan or card prior to this. The whole thing is so gross.
I hate to get biblical but I'm reminded of the story Jesus fucking up those finance bros with a rake. Shit stays the same apparently. 2k years on and it's the same shit. I'm not religious AT ALL but if Jesus did come back and immediately started beating wall Street bros about the head and face with landscaping tools...
Most people aren't reasonable card owners lol
Very normal to have more expenses in a month than you have in income. And if you don't have savings (because you're already living on the razor's edge) then you need to assume debt.
You can definitely argue all sorts of mistakes people make in financializing that debt rather than eating it in other ways (lower quality of life, deferred maintenance, gig work as secondary income). But you'll need to ignore the core reality of personal income being divorced from cost of living. Rents, utilities, car/education debt, and health care costs are consistently the highest budget items on any given person's balance sheet. And so long as those costs continue to outgrow wages, you're going to see more and more people falling into the debt trap over time.
There is no individual solution to a systemic problem, save escaping the system entirely. "I know a guy who fucked up..." anecdotes are - in my experience - far more often stories about kids from rich families who can absorb the debt or skate it using bankruptcy. The "I know a guy who played a perfect hand and is still totally fucked..." anecdotes are far less common to hear about but far more common in practice.
I was told to carry a small balance to improve my credit and it works.
*Claim it's a myth but I saw an improvement from paying off my balance every month. My broker told me to do it in advance of applying for a mortgage, I did try to fact check him but couldn't find anything definitive one way or the other. When it came down to it though, my score improved by changing literally only that.
Common myth. You do not need to pay interest ever to have good credit. Your accounts should show activity, ie your balance on your statement should be non-zero, but you can pay off that entire balance (and thereby pay no interest) and still improve your score.
Don’t bother unless you know you’re going to need a loan. You’re paying a % interest to kiss the credit monitoring companies’ ass. I mean, don’t sabotage your credit, but if you know you are going to apply for a loan or something affected by your credit score, fine, bump it up with whatever works. We pay ours off monthly, score be damned.
It doesn't improve your credit. Source: my memory of various articles saying that, and my own 800+ credit score and having never carried a balance in my life.
Lenders like clients who are slightly in debt, because they are viewed as more lucrative over the long term. Making timely payments is good. Making timely payments with a big interest component is even better, since that's how creditors make their money.
Whomever is downvoting you has never worked the back end of the financial sector. Those double-digit APYs aren't just for show. The primary goal of the business is to get you to pay them. That's why people who do pay off their loans are constantly getting notes in the mail about how their max credit is increasing and personal loans are available and please, please, please borrow more money on a longer time scale.
Anecdotally, I pay off my full balance every month and have an 830 credit score.