credit – Annienygma

Use Credit to Save Money

One of the common claims about credit is that it costs you money to use. While this is true in many cases, in some cases credit can actually save you money instead.

For instance, say that you have saved up money to make a major purchase. You have done your research, decided what you want, and have finally went to the store to make the purchase when the sales person makes you an offer to charge the item.

Don’t be so quick to brush away the offer. In some cases, these offers may come without any interest charges if paid off in a certain amount of time.

This is one of the tricks I learned about when I researched the habits of the wealthy. Instead of using their cash reserves to make purchases, they would instead finance things at a low or nonexistent interest rate. This would allow them to keep their money in the bank, earning interest…allowing them to make a bit of money.

I actually encountered that the other day. While my initial reaction was to refuse the line of credit, it occurred to me that I could place the money I’d saved up for the purchase in savings, finance the item for no interest, and actually come out a bit ahead on the purchase.

It may not seem like much, but these little decisions add up. Now, instead of being out the amount in my savings that I’d planned to spend, I will be able to allow that money to draw interest. While I’ll have to make payments on the purchase, I won’t have to pay anything for the privilege. This not only allows me to work on my goal of improving my credit, it lets me earn a few more dollars on my money that I wouldn’t have earned otherwise.

In many cases, these little offers are designed to be quick and easy to apply for, so they take very little time to secure. Just a couple minutes to fill out an application allowed me to increase my net work just a little bit more.

There is a caveat on some of these offers. Many of them are designed to encourage you to take out a credit card that you will be encouraged to use in the future. If you do use the card for future purchases, those purchases will be subject to interest charges if the bill isn’t paid promptly. That said, many places offer discounts if you use their cards to make purchases, but if you pay the new charges promptly, you come out ahead of the finance game as well.

Pennies make dollars, and even the smallest amount in a savings account can earn you a bit in interest. If you can keep your hard-earned cash earning interest for just a bit longer, your finances will thank you.

Have you ever accepted a no-interest credit offer in order to allow your hard-earned cash to continue building interest in your savings? Please share your stories in the comments below.

How to Annoy Your Credit Card Company

It is becoming more difficult to live without a credit card in this world. You need credit cards to make online payments since more and more companies are moving exclusively online. Brick and mortar stores are beginning to refuse cash transactions now. I suspect that this trend will continue.

While you can use the debit card provided at most banks in lieu of a credit card, this carries risks. If your card is cloned by a skimmer or in any way compromised, you can lose access to your entire bank balance while you get the situation sorted. I learned this the hard way when it happened to me several years ago.

Credit cards can provide a layer of protection from this but the protection comes at a cost for the unwary. Accept the wrong credit card offer and you will find yourself paying outrageous annual fees for the privilege. If you decide to go with a prepaid “credit card,” as in the ones you find at the corner gas station, their transaction fees can be prohibitive.

That said, if you would like to annoy the finance industry while you’re protecting your bank account, a credit card is a wonderful way to do that. All you need to do is pay your balance off in full each and every month before the due date.

You see, credit card companies make their money through annual fees and interest fees. The credit card companies who don’t charge an annual fee rely upon interest fees and late payment fees to make their money. If they can tempt you into carrying a balance every month, these people are very happy campers. In 2016 alone, credit card companies took $63.4 BILLION dollars out of our collective pockets, and they enjoyed hoarding every penny of it.

Just imagine the good that $63.4 BILLION could have done for the poor in our nation alone. That much money could have benefited the poor worldwide, if properly distributed. Yet Richard Fairbank, the CEO of Capital One, a popular credit card company, took home $17,328,902 in 2019. You can look that up. It’s listed in the SEC filing right here.

That one man, Richard Fairbank, is a prime example of how the rich are getting richer off the backs of the rest of us. We slave and we sweat and we struggle while him and people like him sit in cozy air-conditioned offices and laugh.

But there’s a way to strike back at him and the others in the credit card industry. We can use their money for free, and there’s not a thing they can do about it.

Credit card companies hate when people use their money for free. They even have a term for it. People who use the money from credit card companies for free are called “freeloaders” and “deadbeats” by the credit card industry.

It’s easy to do. In fact, I’ve been doing it to get back at them for about a year now.

All you have to do is take out a credit card at one of the no-annual-fee credit companies and pay off your balance in full each and every month. Do not make the minimum payment. They will do their level best to persuade you to make the minimum payment. Pay off the entire balance in full.

It kills the credit card companies when you do this. If you’re smart, you’ll take the money you intend to pay the credit card company off with and stick that money into an interest-bearing account so that you can make a bit of money off of their money each month.

The funny part of this is the fact that the credit card companies cannot penalize you if you do this. When you pay off your credit card balance in full each month, they are actually forced to reward you with a good report on your credit rating.

Please note that if you have trouble paying your bills and with credit in general, you may want to avoid this bit of revenge against the credit card companies. If you cannot resist the temptation to spend more than you can pay off, I urge you to avoid this act of rebellion like the plague. Credit card companies work extremely hard to persuade you to carry a balance for a reason, and they are so good at it that the CEO of Capital One made over $17 million due to their talent.

That said, I enjoy using their money immensely each month. When I work up my budget, I transfer the amount I intend to spend on my credit card into an interest-bearing savings account. By using their money instead of mine, I am able to earn a bit of interest at their expense. It’s not much, but it makes me laugh every time I do it.

This act of revenge allows me to take a bit of money out of the pockets of at least one monster every month. Even better, it allows me to make money at the expense of that very same monster. If you have an issue with the usurious rates and the hidden fees that credit card companies charge, you might want to stage your own little revenge.

How do you fight the monsters? Please share your thoughts in the comments below. I could use some ideas :).

It is hypocritical to run a website about buying and living on less while begging your readers to buy your crap so I refuse to do it. That said, I live on the money I receive from book sales, so if you can find it in your heart to pitch in I would be immensely grateful.

I’ve written a lot of books sharing my odd view of life in hopes of helping others. My most notorious book is titled The Shoestring Girl: How I Live on Practically Nothing and You Can Too, but The Minimalist Cleaning Method is pretty popular as well. You can find them at the following places:

Amazon
Barnes and Noble
Apple iBooks
Smashwords (non-DRM)

Thank you for your support!

Thinking of Long-Term Goals

Last night I fell asleep thinking about my long-term goals. Eventually I would like to own my own home and perhaps build a small real estate portfolio in order to provide yet another stream of passive income.

I’ll have to build my credit if I want to accomplish that.

I don’t like credit. Credit makes it far too tempting to overspend and the interest rates charged…well, I’m cheap.

That said, a good credit score would open doors and opportunities for me that otherwise would be closed should I decide to pursue home-ownership and real estate investments.

I’ve been discussing this fact with my beloved Auntie, who has become my financial counselor as of late. She offered a suggestion that I would like to run past you in order to hear your opinion.

Auntie pointed out that credit cards do not charge interest if you don’t carry a balance. She shared that she keeps a credit card that she uses to make her everyday purchases that she pays in full each month. This not only helps keep her credit in good standing, it provides a layer of protection in the event her card information is ever stolen, since she never uses her debit card. This keeps the money in her checking account safe.

I have no need for credit at the moment; living beneath my means the way I do means that I don’t require it. That said, I know from experience how challenging it can be when a credit card thief empties your primary bank account.

An extra layer of protection would be a nice thing to have. I am a firm believer in hedging my bets when it comes to finances and I have become extremely cautious about using my card in unfamiliar stores. I carry cash with me to avoid using my card these days as a result.

If I took Auntie’s advice I would not only gain a layer of financial protection, I would begin building my credit score. This would allow me to secure credit should I require it in the future to achieve my long-term goals. I could use the card for my everyday purchases, budgeting accordingly as I already do, then pay off the balance each month. This would allow me to avoid any interest fees. At the most, I would have to pay an annual fee on the card until I figured out a way to eliminate that.

What is your opinion? Do you think it would be a good idea to apply for a credit card and use it in this manner? Please share your thoughts in the comments below.

It Pays to Use Cash

How do you handle your money? Do you deposit your check every payday and then swipe your card when you want to buy something?

Every time you swipe your card in public you place yourself in danger. Not only do you put yourself at risk of having your card information stolen by skimmers, you also run the risk of spending more money. Studies have shown that people who prefer cash over cards spend less money. Even worse, some banks charge you a fee every time you swipe your card. My personal bank charges me a dollar every time I use my bank card as a debit card at stores.

Carrying cash can eliminate this issue. If you withdraw the amount of cash you have budgeted for gas, groceries, lunch, and other extras during that pay period, you eliminate the danger of overspending. You know you have so much money for the week, so you need to be careful with your money.

Paying cash also eliminates any chance that you will fall prey to a skimmer. They can’t steal your card information if you don’t give them access to your card in the first place.

If you’re worried about being robbed of your cash, place your money in a place where thieves won’t look for it. My father kept his stash in his sock; I keep mine in an assortment of places aside from my wallet (no, I’m not going to tell you where). It also helps if you don’t attract attention by driving fancy vehicles or dressing in clothing that indicates you’ve got money. It makes little sense to rob someone who appears to be broke just to get a few pennies. Dressing simpler also comes in handy when haggling for a lower price. Some sellers tend to charge more if they think you can afford it.

While you can’t pay cash when shopping online, you can do this for the everyday purchases you make locally. Food, fuel, and other everyday purchases can be made just as easily with cash as with plastic.

If you are not paying cash for your everyday purchases, you need to start doing it now. Your budget will thank you.