PBS Show on Credit Cards

Dargo · Nov 28, 2004

One can always look on the bright side of the credit cards. Of several friends and relatives I have who are attorneys, they all agree on one thing; credit cards sure make it easy to "plan" a bankruptcy. A credit card is generally an "unsecured" debt. Therefore, when you file bankruptcy, none of the assets purchased on a credit card are subject to seizure in a bankruptcy filing. Now, I'm not advocating a planned bankruptcy, and I don't know all of the finer details of how to do it, but if you don't think it happens....well, I have some lovely ocean front property in Montana for you!

Can you imagine how much a person could get away with? I'm sure that I'm not alone with some credit cards that have tens of thousands of dollars in credit limits. Besides, just think if you took up every offer for a credit card you got in the mail! A few more of these large planned BR's, some of these credit card companies may slow down on their aggressive marketing. That being said, I don't at all buy the excuses of the people in debt up to their ears who blame the credit card companies for their problems. Those people took the offers and those people charged up tons of stuff they couldn't afford. Well, I'm admittedly biased, early in this post I admitted that I believe that if you can't afford it, don't buy it. /forums/images/graemlins/crazy.gif

sendero · Nov 28, 2004

Finally, I'm in the TBN mainstream /forums/images/graemlins/smile.gif Call me deadbeat, I pay my balance every month.

I use the cards a lot, because I buy a lot of stuff online if it is a better deal after shipping and taxes are considered - but I just pay if off every month.

Once or twice I've been late due to the bill getting too low in the stack /forums/images/graemlins/smile.gif, I'm usually able to get them to drop the late fee, the finance charge, or both with a pointed phone call explaining how easy it is for me to get another card.

And while the CC companies would RATHER I didn't pay it all every month, they still make money, don't you worry about that. The best merchants get to keep about $98.41 of every $100.00 you spend with them and most get a lot less than that.

Bird · Nov 28, 2004

Yep, Billy, they may call us deadbeats, but they still want our business. /forums/images/graemlins/wink.gif /forums/images/graemlins/laugh.gif

Junkman · Nov 28, 2004

( Now I use it for stuff even less that $5. If a merchant says they will not take my card because the charge is to small it is the last time I use that merchant. It's nice to live in a area where there are choices. )

Lets be reasonable... the merchant is paying a fee just for swiping your card and then there is the discount fee that the merchant pays on the dollar amount. If you make a small purchase, the fees that the merchant pays might exceed the amount of the charge. That is why the merchants are forced to put minimums on credit card purchases. The credit card companies also realize this and allow merchants to establish minimum credit card amounts. The only restriction is that they minimums must be the same for all the credit cards that they accept. Debit cards are handled differantly... the swiping fee is higher and the discount fee is lower. Either way, the banks are getting they bite out of the charge. Some stores use a check guarantee service. These check guarantee services will pay the amount of the check if it bounces. The biggest problem with the check guarantee services is that they know who is a bad check writer and deny the check insurance. When this happens, the stores pay the same fee as if they check had been guaranteed. Once again, they get there money even if you don't make a sale. If you can't pay for a $5.00 item in cash without being offended, then you are a unreasonable person in my eyes.

Gary_in_Indiana · Nov 28, 2004

"If you can't pay for a $5.00 item in cash without being offended, then you are a unreasonable person in my eyes." 

Fortunately, I really don't care how I'm seen in your eyes.

I'm actually MORE likely to use a credit card on a $5.00 purchase than on a $500.00 purchase. Most of my small purchases are for business. Simply put, I don't want to screw around writing a check for $5.00 and I don't want to have to keep track of a receipt and pay myself back for the expenditure. I've even been known to have two items and want them rung up separately because one is a tax exempt business expenditure and will be on my credit card while the other might be a soft drink on which I'll pay tax and purchase with cash.

If I was ever told that my purchase in whatever amount wasn't acceptable for credit card use I would ask to speak to the manager, explain my situation and simply ask if they wanted to lose all of my business over this policy. I'm an incredibly loyal customer but something like that would have me going to another vendor.

ronjhall · Nov 29, 2004

Thanks Gary.
Said better than I could have put it.

riptides · Nov 29, 2004

( I'm sure that I'm not alone with some credit cards that have tens of thousands of dollars in credit limits. )

Best one I have seen so far is a 20k limit with 0 percent APR and balance transfer until Feb 06.

What is up with that? I read all the fine print and what not.

-Mike Z. /forums/images/graemlins/grin.gif

Bob_Skurka · Nov 29, 2004

I live for today. I have huge debts and they are about to get outrageously bigger. People probably think, that I am nuts when they hear what I do. So what. Credit card debt is management of money. Other debt is management of money.
Debt is NOT bad. Good for those that have no debt. Really.
But when I want something and someone is offering 0 percent on it...why not? Hey, it is a buyers market right now. I say go for it.


riptide . . . that is a refreshingly honest apprasial, and while it is not the way I choose to live my life, I think the one thing that I deduce from your words is that you know how much you owe, and you "manage" it in some responsible manner. I do agree that debt is not bad. If used properly debt can be a wonderful tool. I suspect you may live in the moment, but I also suspect you know how high you can live. So for that, more power to you if it works for you, go for it.

What bothers me are the folks who rack up bills cluelessly can't manage them and then end up in bankruptcy so they can start again.

Gary_in_Indiana · Nov 29, 2004

"Credit card debt is management of money. Other debt is management of money.

''Debt is NOT bad." 

Even though I fall into that 'debt averse/debt free' group here, I fully agree with and appreciate what you're saying there. In my twenties and thirties I was probably more in debt than most people (no specifics, but it had two commas) and I managed it. Due to a very odd set of circumstances, I actually bought a house with credit card advances. /forums/images/graemlins/shocked.gif

I think the key to things like that is to have a firm 'exit plan' to refinance or retire a debt like that early so as not to be eaten alive by the finance charges. At least, it was for me. /forums/images/graemlins/wink.gif

In the last decade I worked very hard to become debt free and have succeeded. I remain very debt averse in no small part due to my age (I'm fifty). That having been said, I have borrowed funds very short term at an outrageous rate for business acquisitions because it made sense.

If I have an opportunity to put together a lease deal but am short of cash to acquire the equipment needed, I can factor invoices either from that deal or other lease agreements to acquire the capital needed. The downside is that the financing will cost me .1% per diem in interest (over 36% a year). I know of few businesses which could afford long term borrowing at that rate.

For me, however, it works because I'll only need the money for a few days or weeks and have the payoff plan in place. If I factor $10,000 that way I'm paying $10 per day in interest. Long term that would be suicide. If I pay it off in thirty days, however, I've spent $300 to be able to put together a deal the first payment from which exceeds that amount. This is an example where even paying 36.5% interest makes sense because it not only makes me money, but also allows me the flexibility to put together a deal I might otherwise miss. /forums/images/graemlins/wink.gif /forums/images/graemlins/smile.gif /forums/images/graemlins/grin.gif /forums/images/graemlins/cool.gif

riptides · Nov 29, 2004

(
What bothers me are the folks who rack up bills cluelessly can't manage them and then end up in bankruptcy so they can start again. )

Yes, I can understand that. But I can also see a lot of people one paycheck away from ruin. It does not take much these days to go bankrupt. Credit cards alone do not contribute to that. Have you looked at what banks are willing to lend for getting people into a house? You know the American Dream. That pressure tactic alone, ruins many. Then there is medical emergencies. One trip to the hospital can ruin a lifetime of savings. Money is a tool, management of debt makes or break the person. Bankruptcy has become a lot harder to do this year, or so I am told.

-Mike Z. /forums/images/graemlins/grin.gif