RE: How do you pay?
 

As so many have learned, myself included, I stay away from Credit Cards. Cash only.

RE: How do you pay?
 

I think if many could get away from the "credit" word and simply look at it as a "cash" card with benefits.....they'd realize they're missing out on a lot of fringe benefits. We fly internationally for free due to the use of our "cash" cards.;)

RE: How do you pay?
 

That's terrific!

RE: How do you pay?
 

Debit Card only, and most of the big stuff ispaid for frombonuses and tax returns.

RE: How do you pay?
 

i use my credit carda lot but pay it off IN FULL every month....i get 2% back of what i spend...so its a great deal if you pay your bill off every month

RE: How do you pay?
 

cash, its easier to hide the transactions from the wife! HA HA HA, just kidding (I'm not actually kidding)

RE: How do you pay?
 

Jeff, What you seem to fail to realize is that the majority of American people have no business with a credit card. They can Not handle it. There is no right and no wrong, Just a fact the biggest majority of card holders do Not manage the acct. correctly and end up in a terrible fix.

Evidently you and your wife do a good job of managing yours. Kudos to you!!

Dan

RE: How do you pay?
 

Dan I don't fail to realize that. I'm giving my fellow man the benefit of the doubt to realize for himselfif he has a problem with credit or if he doesn't. I'm just not willing to throw out the baby with the bath water. If I failed to take advantage of FREE incentives offered to me by CC companies........that woud be a TERRIBLE business decision.

The CC is my slave and not my master.

RE: How do you pay?
 

Okay, I have to respond to this. There is a lot of misinformation flying around here and I would like to set the record straight.

YOU DO NOT NEED A CREDIT CARD!!! I rent cars, stay at hotels, buy gas etc... with just my check card. Now, some of you seem to think why not get the free points. Well guess what, even check cards get free points too. I just used my check card points to 2 free flight tickets to Miami.

IMHO, if you are always borrowing money you will never have any. I have no debt except my home and I plan on keeping it that way. Plus, by not carrying debt I have been able to save a significant amount and put it in a money market for a rainy day. I also put an extra $500 a month outside of my roth 401k into mutual funds and if I had a car payment I couldn't do that.

Lastly, if you you pay with cash you typically avoid buyers remorse since there is no guilt associated with the purchase. I like to actually own the things I buy, not the other way around. Just my .02 cents and I don't want any change back. :)

RE: How do you pay?
 

Just like an Alcoholic, he/she knowsthey have a problem with alcohol, but not touching it is a tough order. Many, many people can Not handle credit, even have a history of such problems. Yet many banks will continue to issue cards. It is ridiculous.

I have 1 credit card and the balance is payed off every month. I used to have 2 but cancelled the other. I had sent in a payment on that card and it was due on the 10th. It showed on the statement that payment was received on the 10th and they had charged me a late fee of $35. I called and it had arrived at 1pm local time every thing received after noon is on the next business day:eek:but still the date on the statement was the 10th. I would have felt better had it showed the payment being received the 11th.

I told them a check was on the way, and they could close my acct.;)

I understand you are getting perks, and that's fine, but the idea of those perks cost several people enough they could fly around the World and then some.

Just look at the stats right now on Home Foreclosures. I have custom built homes for 28 years and to me it is No wonder people get in such a bind. Very Few if any build a house to live in, provide shelter, and warmth. It's a status thing for many. Rooms they never go in, dormers where there is no 2nd story, ceilings tall enough for a giraffe, etc., etc. I have built many homes where I myself could not even afford the Property Tax, nor would I want to, much less the Mortgage payment.

American people are soft and a huge majority live past their means.

It's like a friend once told me "Everyone has their vice. For some it's Clothes, others it's Houses, some jewelry, some cars, etc., etc. I guess for me it's Archery;)

Dan

RE: How do you pay?
 

Evidence that "some" people have no business entering into a mortgage.....especially ill-advised as to whether they can afford it or not.

Nothing wrong with alcohol. Using your logic.....it shouldn't be produced.....because some people can't handle it. I strongly disagree. No biggie. Handled responsibly....there's nothing wrong with credit, credit cards.....or alcohol. Home mortgages are "A" way for responsible people to afford their homes. Responsible credit handling is an acquired skill.

Like I said.....I refuse to throw out the baby with the bath water. We can simply agree to disagree.;)

RE: How do you pay?
 

I finally have a pretty good job. I didn't overbuy my house, or vehicles. I pack my lunch instead of going out. I never carry a balance on my cards, even thought that is almost exclusively what I use to pay for things.

RE: How do you pay?
 

Cash or debit card. That is why I don't have the hottest bow or top of the line arrows. But, I still have as much fun and most on here. :D Actually, my son and I both got new bows for Xmas thanks to a bonus at work.

RE: How do you pay?
 

Some of the poorest people I know are the cheapest, They are to cheap to buy quality,they are to cheap to work their way up, junk cars that eat up weekend fishing time ,modular homes that will need rebuild ,windows & floors when the mortgage is half payed.

Think about what you buy and buy the things that make your life better,buy the things that will give you the best return, A nice home and property will increase your net worth and your most valuable possession ,time spent with loved ones.:)

Learn to earn more not to live less.

RE: How do you pay?
 

Guys there's NOTHING wrong with responsible credit.....and even carrying balances. Heck we financed our last vehicle purchase.....even though we didn't have to. My ($_____) works for me in better ways (in other places)than the interest rate we received on the vehicle.

It's also imperative that a credit history be built for you when there comes a time when you NEED to use it (say...for that home purchse...... or for things like boats, automobiles, investment properties, etc...). Cash is not ALWAYS the best payment method.;)

We have to get out of the mindset that credit is a dirty word. It's a valuable toolfor a fiscally responsible person.

When someone's offering you credit at a rate of 5%-8%.....they're doing you a favor in most instances. How much can you expect to receive (on return) for that money if you have it working for you somewhere else?;) Sometimes it's not even a fine line.

I will say that it's admirable that we have so many that think about this, though. Very admirable.

RE: How do you pay?
 

Or of course you could just marry a rich girl. ;)

RE: How do you pay?
 

Gonna agree with Jeff here. I have ONE credit card (Cabelas) that I got when I was 22 (now 23) to allow me to BUILD credit. I use it for gas purchases mostly, but some other things, and the card is paid off instantly by me. That along with my truck payments will hopefully build my credit score up enough so that in about a year and a half, I can hopefully get approved for a decent loan for my house and LAND. Here's the kicker. I experienced first hand the value of perfect credit. My sister and brother-in-law purchased 10 vacant acres to build on. They have been strung around for almost three months by the bank until they were finally approved. Both have credit scores of ~790, but because they were first time home buyers, any parcel greater than 5 acres generally is not awarded a loan to first time home buyers. The bank only awarded them the loan due to perfect credit, PLUS they needed a HUGE down payment. I now know this, and know that building my credit rating is a major priority. Credit cards are a great way of doing that.

RE: How do you pay?
 

Matt.....it would also (believe it or not) do you GOOD to leave a balance and pay it off on terms (on your CC). Doesn't make sense to many.....but it will build your credit score higher to carry a loan (or CC balance) to term.

RE: How do you pay?
 

This is 100% true. They (creditors) want to know if you can make reliable payments over time.

EDIT: It is even recommended (if you are trying to build your credit score) to take out small loans, even if you have the cash, and make all of the payments to pay it off. One of the reasons long time property owners are usually a very good risk is that they have made reliable payments on their property over a long period of time.

RE: How do you pay?
 

Getting divorced can be a quick and easy way to really build up your credit score .;)

RE: How do you pay?
 

Only if every payment is in on time. What most people fail to realize is that credit score is not just a reflection of if the creditor will get their money back, it's a reflection of the likelihood they will receive their payments on time.

I pay everything on my one credit card (for the airline miles) but no matter how high the balance, it gets paid off at the end of each month, no exceptions.

RE: How do you pay?
 

I was assuming that was a "given". It's part of the small print.;)

RE: How do you pay?
 

Why do you need a credit score?????????????????????????????

I bought a house with a better interest rate than prime without a credit score. There is a thing called manual underwriting and you actually getbetter mortgage interest rates than people with the highest FICO scores.

The logic is when they realize you have no other payments the chances of you defaulting are fairly slim. Compare it to a guy who has two car payments, carries a small balance on his credit cards, has a HELOC etc... If he loses his job the chances of him defaulting are great since he has so many financial obligations.

BTW, I now have a super high credit score because I pay early on my mortgage (high 700's) It doesn't really mean anything to me, because I am not going to borrow money.

I have two paid for newer cars, I take at least 2 big tropical vacations a year, hunt a lot, buy lots of gear and do it with cash. It can be done, butthe hardest part is getting out of debt then you can start building a net worth for yourself instead of lining the bank's pockets.

If you are a Christian, it says in the bible the borrower is slave to the lender. The bible mentions debt a lot and has many negative things to say about it. To each his own, but I sleep rather well at night. And if I were to lose my job I could literally spend a year looking for something else. :)

RE: How do you pay?
 

I am going to take my children to the bank when they turn 12 and take a loan out with their name on it to buy them each a ATV and then make 5-6 payments then pay it off(we havealso set up saving accounts for them,put 10 grand in each one when they were 1 yr old).doing this will set up a credit linefor them when they get older.My dad did this with me when I bought my 1st motorcycle/enduro bike....except no savings account.......
You also need to remember that employers(some) will look at your credit too whenapplying for a job to see if your a risky hireie....
Haveing good credit can be a big plus nowdays.....If your young(18-24) getting a cc with a 1000.00 credit limit can go a long way as long as you dont default on payments.

RE: How do you pay?
 

Too many variables to make such a broad statement. Income/debt. ratio is the key....along with a payment history. If a man has a solid repayment history.....he's PROVEN he's not a high risk by his prior actions.

There is nothing better......when you're applying for credit......than a strong payment history. It's FAR better to have paid for something over time.....and lived up to one's obligations....than it is to show no evidence of such (as in paying cash for everything).

I'm not sure about individual state's laws.....but in NC....a minor can't enter into a contract (like say....a credit agreement). I would say, as parents, the best thing we can do for our kids, credit-wise, is to have them borrow money from an institution (even if we have to co-sign) at an early age.....to teach them the value of such. Kudos to you guys who are doing this.

Here's another scenario to highlight something I mentioned, earlier. Let's say that new truck you want is $25K. You have the cash to pay for it......but you'd be pulling that cash from a place where it's earning 10% return on investment. The dealership or other lending institution is offering you a 5% interest rate. Do the math.;)

RE: How do you pay?
 

I pay cash or use an Amex card. With the Amex card, I have to pay it off monthly, so there is no temptation to carry a balance forward.

RE: How do you pay?
 

Robbycam, you real name wouldn't be Dave Ramsey by any chance :D

RE: How do you pay?
 

Some people just don't like to owe. You can give them all the reasons in the world to borrow. But they just don't like to borrow.

RE: How do you pay?
 

Let's take your example of earning 10% while paying 5% on a vehicle. Sure you are paying less of an interest rate, but that money you are earning the 10% on is taxable income. So, 10% starts to look like 7% to me. Also, you are factoring in risk, especially if you lose your job.

What I have done is paid cash for all of my vehicles and I pay $500 into mutual funds each month. I am averaging 12% and every 6-8 years I tap into it and buy another car. So essentially I am doing what you are talking about, but my spread is larger because I am not paying a dealer/bank 5% interest.

Also, even if someone wants to check my credit score it isawesome. Just pay your house payment on time or early and you will have a high credit score. You don't need a credit card or a car payment to build good credit.

Obviously you have made a lifestyle choice of borrowing money, but I think it will slow down your true potential. I have just seen far too many people win with money who refuse to borrow it. My parents make a 6 figure income, but their net worth is really low due to car payments, credit cards etc...

The golden rule is not how much you make, but how much you keep.

PS: Yes Dave Ramsey inspired me 5 years ago and it has been the biggest blessing of my life. I used to think just like GMMAT.

RE: How do you pay?
 

I to am a fan of dave ramsey, it wasn't meant as an insult

RE: How do you pay?
 

Dump it into a retirement account (Roth or 401K) and it's pre-taxed $$ going in. You're also paying off the 5% loan with after tax dollars.....but you're getting the full benefit of $$ invested to work for you until it's taxed upon withdrawl.

Where's the risk?.....if you have the cash to pay the note off?

I disagree. Let's use the example of a man who borrows $300K to start a business. He needed this capital to get his business off the ground....and he's now a profitable businessman. How did this slow down his true potential? It didn't. It afforded him the possibility of his true potential.

You're misuderstanding my intent. Let's say a man has $25K in the bank. His net worth is ......$25K (assuming he owns no other assets). He has the opportunity to purchase a $25K truck with cash or credit. He's receiving a ROI of 12% on his $25K wher eit sits. What does he give up (net) if he decides to purchase the vehicle with cash? What is his net worth if he does this? What's the fiscally responsible decision?

Solid rule.

It's not "my" way of thinking. It's simple math. When it makes fiscal sense....we pay cash.

RE: How do you pay?
 

For one, if you put your money in a retirement account it is not liquid without a 10% penalty. Thus, you would lose quite a bit of money toobtain it.Also, you do realize that a roth is post tax dollars, right?

If you have the cash to pay off the note the spread you are making still is not worth it IMHO. BTW, most peoplewho borrow on vehicles don't have that amount of money saved. That is the reason they are borrowing money in the first place.

Bringing up the $300k borrowed by the business man is not a fair comparison. You are talking consumer debt versus venture capital debt. I might also add that 80% of businesses fail, and $300k is really rolling the dice. If you want to build a business I would suggest starting out slow and doing it with cash.

Oh well, agree to disagree. ;)

RE: How do you pay?
 

The penalty for early witdrawl is higher than 10%.....but that's netiher here nor there. If I were worried about having to tap into it.....I wouldn't borrow against it.You're planning (in your worst case scenario) against a catastrophic loss....and not a temporary setback (such as a job loss). Yes....a Roth is post going in.....but not coming out.

Again...your decision. Not saying on'e wrong or right for everyone. You have to weigh your own wants and needs against your abilities to pay for both.....and also the risks you're willing to take......THEN make a fiscally responsible decision about your $$. We just disagree, some. No biggie! You sound like you weigh your situation responsibly. Commendable. We don't take debt lightly.

Conceded. Each individual is different.

And a wonderful discussion!;)

RE: How do you pay?
 

I just asked the wife why she dosnt pay the 2 credit cards off and all she said was because I dont want too,I said its only 28 hundred and all she said was so,they will be payed off by Oct........
Then the only debt we will have is the new pickup....Every thing else is payed off,including the house...................
I give her my pay checks and she in return gives me money as needed....works well.;)...She takes care off all the bills....and never really gets mad when I buy a big ticket item....now I now why.....

What really shocked me was she had me do the taxes this year(1st time in 11 yrs)and so I got to look at all the differant savings accounts,Roth,checking and it floored me........I didnt realize how much money she has put away....She has done well with out me knowing.....she also said DONT EVEN THINK ABOUT IT...[&o]......

WHAT does that mean...:D:D:D:D...dont even think about it......

RE: How do you pay?
 

It means you married a smart woman.

Congrats.;)

RE: How do you pay?
 

If i buy over here in the UK , i use Cash . If i'm ordering from States , PayPal if they accept ... ain't that right MeanV;).

I got no debts , but my mortgage and plan on keeping it that way . I don't have a credit card and don't plan on getting one either , i'd go crazy with it :D.

RE: How do you pay?
 

I guess you could say that.....She is Awsome......

...way better then my 1st 13 year go around...

RE: How do you pay?
 

BTW, when I said 10% that is the penalty plus you have to paythe taxes.

Anyways, yes great discussion. Hey, at least you are paying attention to your money. We disagree on some issues, but for the most part we both agree to spend wisely and have a plan. :)

RE: How do you pay?
 

I liked your post Robby.

RE: How do you pay?
 

Thanks Bobco!!! :)