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Tuesday, November 21

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Andrew / December 7, 2008 11:41 PM

Question via Val. If you've got a suggestion for a good Fuel question, email it to inbox@gapersblock.com!

jenna / December 8, 2008 6:41 AM

Nothing. I pay it off every month.

But I am clearly addicted to credit, as I absolutely cannot fathom not using cards, be it debit or credit.

Yes, the multinational banks have turned me into a consumption monkey, and I need to involve them in a transaction to buy a simple sammich from the shop on the corner.

Just like they want. Sigh.

holden / December 8, 2008 7:33 AM

Pay it off monthly.
But I use it pretty extensively to rack up my points...not that I've ever used them yet. Someday, though!

barf / December 8, 2008 8:22 AM

"Yes, the multinational banks have turned me into a consumption monkey, and I need to involve them in a transaction to buy a simple sammich from the shop on the corner."

Of course, its a faceless corporation rather than your own volition... how quaint.

Still Paying for Partying in 2006 / December 8, 2008 8:33 AM

$10,000.

I haven't used a credit card since May and my credit score has gone up... but it still sucks. A LOT.

snuh / December 8, 2008 8:51 AM

none, but i don't have any credit cards. around that 9/11 downturn, i ran into some problems with the credit cards -- owed about $7,000. i've heard worse, but it's not good when you don't have a job or $7,000. took a couple years but i paid it off, and haven't had a credit card since.
i mean, my apartment is full of second-hand stuff, and i'm still not much of a saver. but i'm glad capital one doesn't have my number.

David / December 8, 2008 9:05 AM

"Of course, its a faceless corporation rather than your own volition... how quaint."

Yes, in a world where preapproved credit cards are regularly mailed to children, dead people and dogs, and where McDonalds makes it possible to use a credit card to buy a sixty-nine cent cheeseburger, it'd be outrageous to suggest the credit industry has anything but our best interests at heart.

Prick.

tk / December 8, 2008 9:25 AM

Holden, I'm completely with you. Not sure what I'm waiting for with the piles of "points..." Perhaps that Rainy Day?

gl / December 8, 2008 9:39 AM

I pay it off monthly but I use it to rack up frequent flier miles so i can go to Paris someday. I just got my credit back and it was a long hard road through the 20's until now.

JS / December 8, 2008 9:41 AM

$10k racked up during the past three years (that does not include college loans). I've got some cash flow issues. Most of that money went to music, beer & other things that get me through a mundane existence.

Gaigen / December 8, 2008 9:45 AM

Barf... I'm on your side. Apparently not everyone gets what you were trying to say, that for ADULTS, like the ones presumably responding here, getting in debt is an issue of personal responsibility. I've got (minor) credit issues as well and I'm not going to blame it on the easily availablity on credit cards, etc. I made the decision to get 'em and use 'em and I'm doing a good job of paying them off (after getting into some issues... ahem). And what babies and dead people have to do with the question being asked I have no idea (are there babies and dead people answering this question?) Just because they make it easy for you to buy a cheese burger or coffee with a credit card doesn't mean you have to. Points, schmoints. Unless it's a "major" purchase, why can't you use cash?

it'd be outrageous to suggest the credit industry has anything but our best interests at heart.

Is that what you got from his statement? Seriously?

eee / December 8, 2008 9:53 AM

Am I the only one who thought jenna was trying to be funny? Sheesh, people...

I only owe what I've spent on gas in the past month. I've been debt-free since May, and it's wonderful.

Nuke LaLoosh / December 8, 2008 10:02 AM

$1417.86 -- mostly for some unexpected out-of-pocket medical and dental costs, plus a $59.00 gift for the in-laws, not a high-end HDTV.

Per my calculation, that total should be down to zero again some by no later than Valentines Day, 2009.

@Jenna: How are you "addicted" to credit if you are using a debit card? Most individuals who bank at medium-to-large banks have debit cards, so its isn't unusual to use it, and given the transaction fees at ATMs and the shoe-leather costs of finding an ATM, it is more "expensive" to get the cash to pay for regular purchases. Plus, budgeting is easier when you can see, to the penny, the purchases you made on your bank's monthly debit-card statement.

My cheap advice: worry less, unless you aren't saving anything at all. In that case, yes, cut back, but debit cards are not quite the same thing as a credit card, where you are borrowing the money and have to pay it back at 11%-25% APR.

Ooooh, I hate, hate, hate, hate credit card companies.

Baldeesh / December 8, 2008 10:18 AM

I tend to pay it off once a week.

I use it at the grocery store and the gas station and all that stuff to rack up points. And I use the points to get $25 checks, which then get deposited into my travel account.

Gaigen / December 8, 2008 10:28 AM

and given the transaction fees at ATMs and the shoe-leather costs of finding an ATM, it is more "expensive" to get the cash to pay for regular purchases.

I understand what you're saying, but don't necessarily agree. Sure if you can't find an ATM affiliated with your bank you're going to pay a fee, which is why I make sure to get a requisite amount of cash from one of my bank affiliate ATM's at the beginning of the week/day/night. Yeah I may use the (debit) card later, but I'd rather spend the cash than get some "surprises" on my bank statement, what with me being the lousy accountant that I am. I tend to forget to record that round of drinks I paid for, etc. when I'm been tippling in the wee small hours. In those instance, for me, it's more expensive NOT to get cash.

But, really, you factor in "shoe leather costs" when deciding whether to get cash from an ATM? You were joking, right?

Gordon / December 8, 2008 10:55 AM

I was up to $5000 a year ago, but I paid it off this year! WOOT! Now I pay it off every month.

Credit cards are EVILLLL.

Irisheyes1212 / December 8, 2008 11:03 AM

$1551.81 but about $425 of that belongs to my boyfriend. He will pay that this week.

I got into a LOT of credit trouble in my early 20's. I was only just able to get another credit card. I try not to use it much because the APR is outrageous.
I'm going to be 30 on Friday (eep!) and it doesn't seem like I've quite learned my lesson.

Good news....Getting a signing bonus in Feb that should wipe out the rest of it. Yay! Then I plan to put it in the freezer for a "real" emergency.

D / December 8, 2008 11:11 AM

I pay it off every month. In general the way I think about it is if I were to buy something that caused me to not be able to pay off the card that month, then I cannot afford the item.

I like using the card for almost all purchases, even small ones, as it helps me keep better track of my spending. The points get cashed in before christmastime for gift cards which get used to buy the majority of presents that I give.

I enjoy using other people's money for free for the few weeks until the bill arrives to float my purchases, and get rewarded with points.

Janaynay / December 8, 2008 11:13 AM

I was about $4K in debt, due to my own irresponsibility. I do not blame the credit card companies for this. Blaming them is equivalent to saying we don't have minds of our own and can't make decisions.

My decisions were bad. I'm signed up with a debt management company now and am finally taking control of things. It does suck, though, to not always be able to do the things I want to do or buy the things I want to buy. That's just the way it is, though. I brought it on myself.

I am hoping that once I've paid everything off, I won't fall into my old habits.

paul / December 8, 2008 12:43 PM

I had some debt coming out of college that followed me around for about 10 years (Minimal debt on 3 cards from pizza and beer that inflated ridiculously).

That made my credit so bad that I was turned down, with cash in hand, for a savings account! Years of having to cash paychecks at currency exchanges for a point and a half taught me my lesson. Also gave me the habit of always carrying cash. I find it ludicrous that people will spend 5 bucks to get a couple of twenties.

Now I don't owe anymore than the monthly bill. For years all I've been carrying was an AmEx and a debit card, but I just got a Visa from my bank (I think they're morons for giving me one).

I only accepted it as a safety net against any coming recessions.

Jenna / December 8, 2008 12:53 PM

@Jenna: How are you "addicted" to credit if you are using a debit card?

Simple. There is nothing I really can't afford because I don't have the money on me.

In days of yore, if I didn't have enough cash money on me to buy the lunch I wanted, I bought the cheaper one that I could afford.

When I was a poor grad student, many times I had to settle for a extra value meal when I really wanted something better, but couldn't because I wasn't going the bank until Friday.

That doesn't happen anymore, simply because I don't have to go to the bank and cash a paycheck every two weeks. I have the entire amount of my bank account at my fingertips, every day.

Managing cash back in the day forced me to sacrifice, rather than indulge.

But the multinational banks don't make any money when people sacrifice.

R / December 8, 2008 1:56 PM

I applied for my first credit card at age 28 and was turned down for not having any credit.

Mo / December 8, 2008 2:21 PM

I am about 14K in debt (7K if you count my savings, which I don't want to use to pay off debt because it's making more interest now than my credit cards are earning.)

I earned my debt from a slow accumulation of living slightly above my means, grad school tuition for which I was not eligible for grants or loans, and a surprise surgery last year that cost me a huge amount of money out of pocket.

But I'm not too concerned. I'm on a strict budget now that includes paying off my debt at a reasonable speed, and I have a good job and good prospects.

I will say that I despise credit cards, though. I've had more than a couple of them lie to my face about their policies. Are they trained to do that? Read the paperwork, people, because people on the phone will LIE.

jen / December 8, 2008 2:55 PM

Mo -- where do you have your savings? Every CC I've ever had has APR higher than my 2.75% rate I have in savings at ING.

Mo / December 8, 2008 3:05 PM

Well, it's a combination of special circumstances. The credit card that carries my balance (I have one that I spend on and pay off every month) has a rate of 2.99% for the life of the balance. My savings are in a money market account at Edward Jones, and I periodically throw it all into CDs and just keep letting it roll over when they mature. I can't remember the exact %, but I *think* it's about 4%?

Nuke LaLoosh / December 8, 2008 3:29 PM

@gaigen, w/respect:

Yes, of course I consider "shoe leather" costs when getting cash. So do you. You admit as much in your very own post.

Please pardon my didactic tone, but "shoe leather cost" is an economic metaphor/term of art for the pain-in-the-ass factor of completing a transaction. More properly, it is a form of opportunity cost an economic actor bears by using his time and resources to complete an economic activity that could otherwise be spent maximizing productivity or increasing utility. While "shoe leather cost" is often used in the context of behavior that seeks to avoid the negative effects of inflation (walking back and forth to the bank more frequently than normal to protect your cash from the ravages of inflation), it can be used to express a whole universe of otherwise unnecessary time-and-effort consuming actions.

You take "shoe leather" costs into account when you "make sure to get a requisite amount of cash from one of [your] bank affiliate ATM's at the beginning of the week/day/night," rather than just getting stopping to get cash throughout your evening out.

The real point of my post is that a) debit isn't the same as credit and b) I keep better track of my spending when I can see it summed up electronically at the end of the month or can check it online the very next day. If I take cash out on Monday, by Saturday, I'm never quite sure where I spent it all.

Sorry -- I used to teach economics.

Val / December 8, 2008 3:53 PM

I find it funny they made me take a health class but never a financial health class in school.

I think that Gen X/Y will be hurting with credit cards for a long time because we have lived in a world where the economy was GOOD until now.

We are the generation debt.

TKO / December 8, 2008 3:54 PM

I owe nothing on credit cards. I paid them off this spring and am sticking to debit now. It feels good.

xa / December 8, 2008 3:57 PM

20k

Mimi / December 8, 2008 4:16 PM

I've carried balances in the past. I don't use anything but my debit card or straight cash now. This has reduced my stress level significantly.

Gaigen / December 8, 2008 4:28 PM

You take "shoe leather" costs into account when you "make sure to get a requisite amount of cash from one of [your] bank affiliate ATM's at the beginning of the week/day/night," rather than just getting stopping to get cash throughout your evening out.z

I see your point. Yes, for me it is a time-saving factor, and sometimes even a money-saving factor. I personally find I can limit my spending if I rely on the cash I have on hand. For the most part it works: out of cash, time to go home. But there have been those sudden trips to the ATM...

If I take cash out on Monday, by Saturday, I'm never quite sure where I spent it all.

Nah, I don't carry around enough cash for the whole week I shouldn't have said week in my original statement, just day or night), just for the day or night. I have a pretty good mental map of where all of the ATMs and affiliated ATMs from my back are located near my usual stomping ground, so I can avoid those fees that add up. And I remember to keep those recipets, even when a little...relaxed, let's say. Granted it's made for some head-scratching moments the next morning, but at least it's verified on paper and I can figure out what's what and verify it by checking my account online the next day or two.

Em / December 8, 2008 5:17 PM

None, I pay it off every month and rack up the miles--I can go to Asia for free now! (of course, paying for it once I get there is a whole different problem...)

San Francisco Financial Planning / December 8, 2008 5:42 PM

Make it a regular practice to call your credit cards to ask for a lower rate. I have one client who owes over $20,000 on a Visa that was at 18%. He spoke with a 'rate specialist', touting his rising credit score and declining balance and got his rate cut in half, from 18% to 9%! His monthly interest charge was instantly reduced by $150, which will help him pay off his debt even sooner.

Carlotta / December 8, 2008 5:59 PM

I pay my credit cards off every month. (I have three of them.) It's usually $200-$300 per billing cycle.

However, I'm going to stop carrying one around continually because it encourages splurge spending, and I **really** need to watch the pennies now.

moss / December 8, 2008 6:08 PM

I've got about 500 bucks O' debt on Ye Ol' Card

fluffy / December 8, 2008 7:32 PM

No more than $5,000. Why? Are drinks on you tonight?

Steven / December 8, 2008 8:18 PM

$11,000 on home equity line of credit @ tax-deductible interest rate of 6.25%. Only used for major home improvement projects. Carson's, Nordstrom and Homo Depot are paid off in full at the end of each month if used. No other credit accounts. Expecting inheritance payment early next year that will be more than enough to pay off HELOC. And buy a bottle of bubbly. BTW, it's best to leave home without the credit cards. Just take a debit card. Karl Malden was rich. We aren't.

v / December 9, 2008 12:49 AM

$5100 on one credit card and at 5.9% apr. I am starting to pay at least $500 a month to it, so I don't feel all that guilty about having that much debt. I figure in one year it will be paid off, if not sooner.

I'm also not counting in my student loans. I'm assuming those will be with me until I have kids...

anon / December 9, 2008 9:53 AM

Wow. This is a pretty financially smart group, or all the idiots like me are afraid to post. I've paid 12k off this year, another 16k to go.

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