One Credit Card to Rule Them All

Discussion in 'Hangar Talk' started by AggieMike88, Aug 10, 2017.

  1. Sac Arrow

    Sac Arrow Touchdown! Greaser!

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    Eight Balla
    Oh, but on the other hand, although the Asian Paradise Spa will take credit cards, you REALLY don't want to use one there.
     
    denverpilot and deonb like this.
  2. denverpilot

    denverpilot Taxi to Parking

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    It usually starts very innocuously. “Oh that’s a couple hundred bucks more than I can pay back this month, but I’ll pay it back next month.” With all the best intention to do so.

    Then the car needs tires. Or the water heater blows up. Or ... whatever.

    Another huge trigger is job loss. I’ve seen more than a handful of people who lost a job, didn’t trim the budget nearly hard enough, and let the leftovers stay on the card. One even eventually filed bankruptcy out of it. And got to keep more than his share of the debt in divorce court right afterward too.

    I think the current “wisdom” on the street is that something like 80% of Americans have never completed a written budget. The fact that you know your budget is also a plus. It’s hard to believe but I’ve met folks who have absolutely no idea how much money comes in or goes out other than watching their checking balance on an app to see if they can eat today. And I don’t mean folks who are poor, although poverty certainly can complicate things badly. But folks who just let money slip by as they spend it as fast as it comes in.

    Having been pretty stupid in our 20s although we’ve seen far scarier and far dumber, we dug out and now are zero-debt in our 40s. We are actively looking for ways to volunteer next year teaching basic budgeting and fiscal planning in our community, we just haven’t found a way to do it that fits both of our schedules.

    Once we hit the right combination of circumstance on that one, we’ll be doing that as a way to give back our time and energy and maybe save some folks from mistakes, but folks rarely come to a financial class BEFORE they make mistakes. Often huge ones.

    The good news is, if you look at the numbers for income vs what most unsecured creditors will loan people, it almost always comes out that it takes roughly two years with no change in income to dig out of the deepest hole the credit card companies will allow, if you hit a really hard “no life” kind of budget. 3 is usually fairly comfortable. No vacations and such, but the problem does self-limit a bit, since creditors won’t loan it without HUGE interest rates (sleazy car sales places or payday loan places) after a certain percentage of income. The 2-2.5 year number is surprisingly consistent.

    Student loans do NOT fit into that number. Sally Mae will enslave people for four or even ten years without batting one of her diamond encrusted eyelashes.

    Most folks who have massive student loans AND consumer debt come to the quick realization that they need a significant pay increase to kill all debt. Either they take a second job, or they bust it at the first, and get OT or promoted or all of the above. Increasing salary is common once people get on a real budget. They see the need for it and have motivation to try harder.

    Well anyway. That’s the gist of it. You learned somewhere along the way to live within your means. Many don’t.

    My wife, as lovely as her family are as people, was not taught anything really about finance. She was taught to live within means, but investing/saving and team/family budgeting wasn’t a thing. Her dad was a lawyer and had an above average income so he thought doing all of it was doing the family a favor. It never does. They just end up unprepared for life.

    She knows this now and her mom also talks about her dad always doing every bit of it and mom finding a bunch of problems when she finally looked — letting a person with the onset of dementia handle the household finances, probably isn’t a good idea, she now notes — but she’s learned over the years. She still impulse buys certain things (spenders by nature all do) but she’s never had such expensive tastes that an occasional impulse buy will break the bank.

    My downfall was vehicles. I impulse purchased vehicles regularly in my 20s. Very very very bad. But “everyone has a car loan!” LOL. Idiot.

    Learning that lesson the hard way with upside-down vehicles and paying way too much for them, is probably why I won’t go buy myself a new truck now. Hahaha. But man, that brand new Geo Metro sure smelled nice, but wasn’t so good when I sat on the corner of the hood of that beer can PoS, and dented it. LOL.
     
  3. frfly172

    frfly172 Touchdown! Greaser!

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    I have a dedicated card for all my flying bills.1% cash back doesn’t seem to be a great deal.