Reply
Valued Contributor
jsickz32
Posts: 1,987
Registered: ‎06-25-2012
0

Re: What's the Big Deal with APRs?

True but then makes you wonder whats the point of store cards like express, VS etc. People who buy at such stores want that card cuz gives them the flexibilty of buying more things. If they usually can spend 100 worths of things that card allows them to buy 200 now and they are ok with paying 4 dollars on interest just so they can do that. I dont see anything wrong with it and op was talking about small amounts not 4 or 5 digits amounts.
Amex BCE (2500) / Amex SPG (4000) / Amex GoldPR / Merrill+ Visa siggy (5000) / BofA Amex (6000) / Bofa cash rewards (5000) / BofA Privileges Cash Rewards (5000) / Citi Forward (4400) / Citi DP (2000) / Chase Freedom (4000) / Chase CSP (5000) / Chase Hyatt (5000) / Discover IT (1700) / FNBO AMEX (3600) / NFCU cashRewards Visa signature (15000) / NFCU Flagship Visa signature (12500) / NFCU Navcheck (5000) / Nordstrom (500) / MetroCU Visa Elite (5000) / Walmart (4500) / Kays Jewerels (6600) / Kohls (300) / Macys Platinum (2500) / DCU platinum Visa (17500) / Citizens bank cash back (1100) / Bill Me Later (1631) / PayPal Smart connect (2200) / BestBuy store card (2000)
Valued Contributor
jsickz32
Posts: 1,987
Registered: ‎06-25-2012
0

Re: What's the Big Deal with APRs?

@migliogiorni
LOL Air Force 1's lover here too!
Amex BCE (2500) / Amex SPG (4000) / Amex GoldPR / Merrill+ Visa siggy (5000) / BofA Amex (6000) / Bofa cash rewards (5000) / BofA Privileges Cash Rewards (5000) / Citi Forward (4400) / Citi DP (2000) / Chase Freedom (4000) / Chase CSP (5000) / Chase Hyatt (5000) / Discover IT (1700) / FNBO AMEX (3600) / NFCU cashRewards Visa signature (15000) / NFCU Flagship Visa signature (12500) / NFCU Navcheck (5000) / Nordstrom (500) / MetroCU Visa Elite (5000) / Walmart (4500) / Kays Jewerels (6600) / Kohls (300) / Macys Platinum (2500) / DCU platinum Visa (17500) / Citizens bank cash back (1100) / Bill Me Later (1631) / PayPal Smart connect (2200) / BestBuy store card (2000)
Valued Contributor
Dustink
Posts: 2,980
Registered: ‎10-02-2012
0

Re: What's the Big Deal with APRs?

[ Edited ]

In my opnion, you should avoid carrying a balance as much as possible. It may only be $4, but that is $4 you could have saved if you saved up for the clothes. I don't mean to knock you, but $200 for jeans seems silly, especially if you cannot afford them.


+1

 

That $4 alone would buy you a decent pair of jeans at a thrift store. Maybe even a pair of Buckle jeans.

 

$200 for a pair of jeans is wasteful. Clearly you cannot afford them. Is it so that you can tell your friends, "Yeah, I have a $70 monthly payment on my jeans."

 

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:21    


     $14k          $8.5K          $7.5k          $7.5k         $6.5k             $6k             $5k            $5k             $5k              $5k           NPSL       @ 0%
Regular Contributor
kwazziee
Posts: 148
Registered: ‎09-26-2011
0

Re: What's the Big Deal with APRs?


jsickz32 wrote:
@migliogiorni
LOL Air Force 1's lover here too!

I really don't see anything wrong with OP spending habit. Every person is different on what they consider is worth buying. For some it's furniture, clothing, cars or big homes. I think it okay to buy high ticket item as long as one can pay them back. I would not spend that much on a pair of jean but sure can on a pair of shoes:smileytongue:

 

LOL Air Force 1's lover here too!!

 

Valued Contributor
navigatethis12
Posts: 1,936
Registered: ‎01-24-2012
0

Re: What's the Big Deal with APRs?

I was not really saying $200 is too much. I know everyone spends different amounts on everything. What I was mainly pointing out is that I do not believe you should buy something without the funds to cover it if you need to. One missed payment and you have a late fee and higher interest and that $4 turns into a bit more.  I am just cheap with everything and the very idea of having to pay interest is sour to me. There are many cards with zero interest for a period of time that you could use to buy things. You should just always be able to pay off whatever you charge to a card.

 

I also understand wanting to save cash reserves and just use a card, but in my opinion I would rather use the cash. You should have at least a years worth saved up so a new appliance should be small change. Everyone manages money differently though. If I want something I revist the idea many times and sometimes I forget all about it and that is money saved.

Established Contributor
compassion101
Posts: 596
Registered: ‎06-06-2012
0

Re: What's the Big Deal with APRs?

A little bit of interest is not a big deal if you decide it is worth it and you can afford it. There are many circumstances in business and a few in personal life where you might need to carry a balance when short on cashflow. While I agree it seems wasteful to spend $200 on pants, if you feel it's needed then why should I care. I once financed minutes on a phone chat line.

 

I would say though to be a bit careful about getting into a spot in life where you are financing jeans and similar items on a regular basis. It will end badly.

 

 

Regular Contributor
bobebob
Posts: 246
Registered: ‎08-14-2011
0

Re: What's the Big Deal with APRs?


laboi_22 wrote:

. . . . . . . 

 

I knew that my statement period had just begun. I wanted some jeans that were going to cost me $204 with tax. I purchased them:

 

Before the statement due date (about 25-30 days) I went in store and made a payment of $65 and some change so that I now owe an even $139. I then took out my handy interest calc and here is my payment plan:

 

month 1: $71,72

month 2: $71.72

 

I will have paid a total of $4.44 in interest for making 3 monthly payments that are easy to pay right in store, and now I have a pair of amazing jeans to boot! So $4.44 is not that much for me (based on 24.99% APR).

 

 


 I just have a small point to bring up on the interest you will pay in this case.

 

If you don't pay a balance off completely before the due date on the statement, the grace period goes out the window.  I.E. you will pay a finance charge on the entire purchase, not just the part you didn't pay off completely before the due date.

 

Here's about how it should go down:

 

$204.00 purchase.

$65 payment before due date.  But since it isn't paid in full, there will be interest charges on the whole amount of $4.24 appearing on your next month's bill.

Leaving a balance of $143.24

you could then pay this off in 2 equal payments of about $74

Interest for the second month on the $143.24 balance would be about $2.98 minus the $74 payment leaves a balance of $72.22

 

When you pay this $72.22 off you will still see another finance charge of $1.50 on the next month's bill.

 

The total interest would be about $8.72

 

Not the end of the world, but it is about twice what you had estimated.  

 

You have to pay the amount down prior to the statement posting not to be charged interest on it if you will be carrying a balance past your statement's due date.

bobebob || Sept: My FICO SW EQ(Upgraded Version) = 833 ||Sept: Walmart TU Fico=838Goal = FICO's>800 || In my wallet: CostcoAmEx(20k), DCU Visa Platinum (10k), BoA Visa Signature (17.1k), Walmart Discover (7.5k), AmEx Corporate (5k). All PIF every month.
Frequent Contributor
AF_23
Posts: 288
Registered: ‎02-06-2012
0

Re: What's the Big Deal with APRs?

[ Edited ]

Not a huge deal, but rewards cards in particular that people love on here are simly inflated with rates that can be questionable. Not to mention some prime cards throwing around a 21% APR seems almost laughable.

 

B/T's are a decent way to combant it if you have lenders who offer attractive rates so as long as you arent pyramiding debt

Established Contributor
laboi_22
Posts: 634
Registered: ‎07-07-2011
0

Re: What's the Big Deal with APRs?

I don't think it's a problem to buy an expensive pair of designer jeans. That's what I like to spend my money on. My bills are all paid. My partner and I make 100K+ together. I make 90 alone. I like to finance sometimes because we have a good bit of bills and we enjoy doing things that sucks up money. I have more than enough money to pay off right away, but if I know I'm only going to be making 3 total payments and racking up $4.00 in interest in a store that I'm going to be in every month anyway it just make sense to me. I may even pay it off earlier. I just like to use my left over gas money to buy my fancy jeans. My company pays my milage but I have a small car that doesn't use nearly what it pays me so I end up with an extra $200 a month in gas money that I either save or spend on jeans. I don't get a check every month for it though it just depends on when I submit my expenses so I thought everytime I get my gas check, I'll pay off my jeans. It only costs me $4.00. Crazy but hey it works for me!

Current Scores: EX - 728 FICO (5/11/13) TU - 771 FICO (7/02/13) EQ ??

Current Cards: Chase Freedom $5,000, CSP $5,700, BofA Visa Signature $15,000, AMEX BCE $6,000, Walmart $4,150, Gap Visa $10,000, JC Penny $5,800, Lowes $8,500, Dillard's AMEX $8,000, AMEX Hilton HHonors - $2,000, Chase United $12,000, Citi AAdvantage & Simplicity $6,000/$6,000, SPG AMEX $1,000
Established Contributor
Jlu
Posts: 766
Registered: ‎06-12-2012
0

Re: What's the Big Deal with APRs?

Imagine if instead of flushing $200/mo on jeans you took the money and invested it? You could have over $30k saved in less than 10 years. But instead you will have a pile out-of-style jeans - since metal suits will be all the rage in the year 2020.

Wallet: JP Morgan Select $10k | CSP $10k | Citi TY Premier $7k | AMEX SPG $5k | AMEX PRG NPSL | Barclaycard $5k | Discover IT $10k | NASA Platinum-Advantage $10k | Chase Freedom $3k | CapOne Quicksilver $3k | BofA Cash Rewards $8k | Walmart Card $5k | Amazon Card $10k | Chase Auto 1.49% | Joined myFICO 6/12 with a 540 FICO & today I'm over 750!

myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.

>> About myFICO
FICO Score - The Score that matters
Click to Verify - This site chose VeriSign SSL for secure e-commerce and confidential communications.
Fair Isaac Corporation is a BBB Accredited Financial Service in San Rafael, CA
FOLLOW US Social Media Facebook Twitter Pinterest Google+