Build credit

[swampknob]

Credit cards are dangerous in college. I was used to going into a bar knowing my debit account had just hit the low balance alert and I had to work some magic with $25. Once I got a credit card...2am, women, and shots put me in the red a couple times. Good learning tool though.

[2thDoc]

thanks gentlemen
and BH--you're a douche rocket

[SCDAWG]

Let me tell you something about credit cards and credit. I watched a family member have 7 credit cards and had 25,000 balance. On bullshit stuff. You can miss up to 3 payments (racking up interest and late fees) and still have a credit score in the 800's. Up to eyeballs in debt, and playing a game on which card needs to be paid off which month. All the while, she had a very impressive credit score.

Blew my mind. I had no idea that was possible.

[FULLCHOKE]

Don’t let him hang out with Rick at TTTs with his new credit card

[SCSwitchback]

A FICO score is absolutely important and Dave Ramsey is an idiot.

Credit is used to underwrite many things including home and auto insurance. Bad credit or no credit could cost you hundreds more a year in premiums or could actually make you ineligible for coverage.
I think it's bullshit but I don't make the rules, please don't shoot the messenger.

That’s an opinion, not a rule. Someone in position to pay cash for whatever they buy isn’t paying BS interest on cars/boats/a tv, etc. That savings easily offsets any marginal increase you might see in insurance. I’d agree that young adults need to establish a strong credit score to get started in life but insurance doesn’t factor into that.

[2thDoc]

fwiw, this kid wouldn't mess this up. 100% certain on that. he will pay it off.
I just wondering if it was necessary. I tend to agree that credit score is, and will be, important going forward.

[2thDoc]

Don’t let him hang out with Rick at TTTs with his new credit card

ha

this is other kid.

[SCSwitchback]

I’ll also disagree on keeping a credit card active. Use it to build a credit score and maintain it while getting a nest egg built up. One you’ve gotten a home loan or car loan, burn the credit card as it’s then served it’s purpose.

[joshua2]

One of the criteria for credit score is the length of credit history so it is beneficial to start early if possible. Also if you do get a "first" credit card/account make sure you keep it active as this is a key number. I have a Cabelas credit card I used in college to get free shipping on my first set of waders that I keep active by making a purchase once a year on it.

This data is grouped into five categories: payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%) and credit mix (10%).
https://www.myfico.com/credit-educat...r-credit-score

I read an article describing how to get a CC and add your children as an authorized user. I’m talking 3 and 5 year olds. Paying off the balance each month and when they are 18 they will have a 750 credit score to get them started in the right direction. I never investigated it any further but it seemed logical.

[JJ1965]

I’ll also disagree on keeping a credit card active. Use it to build a credit score and maintain it while getting a nest egg built up. One you’ve gotten a home loan or car loan, burn the credit card as it’s then served it’s purpose.

No. If a credit account is closed, by the credit grantor or by the owner, your credit d ore drops significantly.

[Bad Habit]

thanks gentlemen
and BH--you're a douche rocket

You set yourself up for that by pretending that you know nothing about credit- any professional person should be very well versed on properly using credit.

Did you read my second post dipshit?

[Hunt'em up]

This is the guy who inspired "To Catch a Thief", now investigates for FBI I think. Pretty good advice....

[Saltydog235]

A credit card isn't a bad thing if you manage it right and are disciplined with it. Pay the balance off every month and interest charges are moot. Get a card that will pay you back some can be a great way to build credit and learn to manage your expenditures every month.

The greatest thing ever was when Cabelas/BP came out with the business card. I use a CC for everything in business and rack up the points, just pay it off every month.

[TJR]

Tell him to get (2) and send it to you for safe keeping to serve as an oldest point of credit.

[SCSwitchback]

No. If a credit account is closed, by the credit grantor or by the owner, your credit d ore drops significantly.

Correct, I’m not arguing that. But once you’ve established credit and bought a home, making the payments on that home are going to rebuild the credit score. At that point, there no reason to keep the card unless you just want to buy stuff that you can’t afford. If you can afford it, just pay for it.

[Hunt'em up]

Correction. "Catch Me If You Can"

[darealdeal]

If you really want to help him understand credit and money and everything.... Help him buy a rental property and learn passive income. That will help his credit as well as create a stream of income.

[darealdeal]

This is the guy who inspired "To Catch a Thief", now investigates for FBI I think. Pretty good advice....

This is one of the videos I was referring to.

[Remy]

Correct, I’m not arguing that. But once you’ve established credit and bought a home, making the payments on that home are going to rebuild the credit score. At that point, there no reason to keep the card unless you just want to buy stuff that you can’t afford. If you can afford it, just pay for it.

You do realize you can do exactly what you said using a credit card?????

[Saltydog235]

Correct, I’m not arguing that. But once you’ve established credit and bought a home, making the payments on that home are going to rebuild the credit score. At that point, there no reason to keep the card unless you just want to buy stuff that you can’t afford. If you can afford it, just pay for it.

That's one way to look at it. I pay my utilities, marina slip, household expenditures etc on one, end of the month I pay the mortage and a credit card bill and I'm done with bills. Business wise, other than supplier/subcontractor accounts, everything goes on a card with a job assigned, makes tracking easier. Pay it off every month. It isn't about not being able to afford it for a lot of folks, it's about convenience and simplifying things. Yes, it takes discipline because some people cannot walk away from that shiny new toy.