Another double whammy!

Ok, so another rant for today. Credit cards and indeed any credit system. I just finished paying off my credit card, which for all 1200$ that was on it initially, wound out costing me around 4000$. That's a lot of money for a college student to fork over.

What to say about credit companies-they are pushy, greedy, mean, persistent, and smooth talkers. They know how to sell their product really well, and take advantage of stupid college students ( I can probably extent this to just people in general, but i was just a freshman when this started).

And the story starts like this: I obtained the credit card my senior year in highschool to try and build some credit in college as well as overdraft protection the banker tried to convince me I absolutely needed. Bullshit. Best overdraft protection: go into the red once (meaning like $50+ of overdrafting), and smart people learn to budget so much better after that. So here's how I accrued my credit bill. My freshman year in college I did pretty well, paid everything, never went into the red, always are, and I was able to afford living in on-campus housing (fancy for dorms). One of the best years if my life to be sure,a lot because my best friend and cousin was there for it all. So the summer after that initial year we decide to move into an apartment together. He skipped town on me, which, when you work minimum wage and part-time, is a death sentence. I spent the year working my add off to succeeded in school and pay my debts. $450 a month was rent, and on the best of months, how much I earned in wages. So now you can see why that credit line I had left rather alone (except with quick, cheap monthly purchases that I immediately paid off to build credit) seemed like my only option. I know what you are probably thinking "why didn't you ask family for help or advice?" My dad was paying for my cell phone at the time (which I'm still eternally thankful for) but he has had some history of getting behind payments as well...so my phone often would be deactivated, and with no internet, I was alone. This is not an exaggeration, the only friendly human contact I had was at my work. Later in the school year my friend Mitch would hang out with me and share his flex meals with me (which I am also eternally thankful for). So that's how I made my debt. For three years I've been battling to get it paid off. As of 9:23pm Jan. 21, 2011 I have it eliminated.

My advice: if you feel the need to build credit, don't do it in college. You may want to start your life early, that's ok, but don't plan on buying a house until you established your credit as a couple. How you builds credit safely and easily: get one credit card to your most used grocery store, use it when you buy groceries , then go home and transfer money to pay it off immediately. Consistent payments and having fewer lines of credit GREATLY helps build credit. Not high payments less frequently.

Always pay your utilities and rent on-time. These silly bills help to establish credibility, which often helps you obtain credit or better housing or deals (you'd be surprised how far a couple of good references can take you).
Don't take out loans if at all possible. I make two exceptions: student loans and mortgages.lets face it, education us expensive and nobody wants to waste 9 years of the"playing it debt-free" method to get a 4 year degree. Houses are expensive, and nobody is going to save up $10k and just but a house (unless you are rich in which case you don't really need credit).

Now for these loans, get ahead with them, get that job but still live in a small apartment until you get a better job in life or married or something like that.you spent at least 4 years living in smaller spaces just fine, so why move up? Seriously, as a lower middle class wage you make around $30-50k annually. So if you still pay $300 a month for rent and have an average $200 a month in bills and groceries...that's $6k a year on what beds to be paid. How much outside of that you want to pay off your loans is up to you, but you can see how much faster you can pay it off by waiting a few years (ya you might want a new car, but c'mon, with the way gas is right now, that's not a sound investment really).

Mortgages are trickier because you can't just live in a cheap place to boost your monthly allowance on that bill. Still, if you have already eliminated almost all your other debts, and maintain things like you are still in college with no money, you can eliminate years of large debt in months.

so credit is the bitch of society in my opinion because you need it, and you need it eliminated. Not to mention or current world economic decline is due to overeager credit companies willing to suck the middle class dry, so avoid debt to these companies as much as possible. Try to only have one or no debtors at a time, but if you do find yourself in too deep with too many debtors, talk to a credit consultant or starving business major at your local college, they want to help get that monkey off everyone's back (or eat if you're the college student). Yes they charge a fee, but that isn't anywhere as bad as what the debtors charge you in overdraft or surplus charges is it?

So be smart, debt is inevitable, so prepare for it, and be ready to squash it as fast as possible.

Published with Blogger-droid v1.6.5