Reply
Contributor
Posts: 567
Registered: ‎10-04-2012
0

Re: What's the Big Deal with APRs?


Dustink wrote:

Any interest is bad interest, and any fee is a bad fee. I am against paying annual fee's and paying interest. I have never done either one. The banks should be paying us, not the other way around. They collect enough off merchant fee's, we don't need to give them interest as well.

 

If you need to carry a balance which it sounds like you do. First and foremost, you should not make the purchase unless it is for your families well being. At the very least you should be using a low interest card, not a high interest store branded card. If you plan on carrying a balance, which is a bad idea in the first place. You should use a card in the neighborhood of 6%, not 25%.

 

It is a bad mentality to get into the idea of it's only a small amount it doesn't matter. Every penny adds up, and the more you waste now. The less you will have later on.

 

For example. $8 now and $4 (increased 3% each year for inflation, as in your jeans are costing more so your finance charges are going up by 3% each year) each month invested at 6% over the course of 40 years (retirement age) adds up. In this case it will be $12,000. So every penny counts. I am not even going to go into the waste of money for the jeans. Just always keep an eye out for ways to save money. The money is flowing well now, but image if the cash flow stopped. You would feel pretty bad about wasting all that money when now you can't even afford necessities.
 


Interest is a cost of acquisition & convenience. One must weigh out whether the pluses of acquiring something more quickly outweigh the minuses of paying a higher price for it. That's a subjective judgment that each of us can only make for ourselves.

 

FICO 04 scores: 809 (EQ) 812 (EX) 818 (TU)

Amex Platinum NPSL - Citi HHonors Sig. $58k - BMW Ultimate $40k
Chase Sapphire Preferred $62k - Merrill Lynch + Signature $41k - USAA Rate Advantage $28k
NFCU Flagship Signature $50k - USAA Cash Rewards AMEX $28k
Citi Platinum Select / AAdvantage Signature $31k - Chase Amtrak Rewards World MC $41k

Valued Contributor
Posts: 3,099
Registered: ‎10-02-2012
0

Re: What's the Big Deal with APRs?

I understand that for a house, but not for a superfluous item at 25% interest.

 

I will stick to being a deadbeat.

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:23    


     $17k       $8.5K          Closed          $19k      $6.5k        $24.2k        Closed         $5k       Closed     $8.5k        Closed      @2.49%
Community Leader
Valued Contributor
Posts: 1,408
Registered: ‎07-12-2011
0

Re: What's the Big Deal with APRs?


Elcid89 wrote:

Dustink wrote:

Any interest is bad interest, and any fee is a bad fee. I am against paying annual fee's and paying interest. I have never done either one. The banks should be paying us, not the other way around. They collect enough off merchant fee's, we don't need to give them interest as well.

 

If you need to carry a balance which it sounds like you do. First and foremost, you should not make the purchase unless it is for your families well being. At the very least you should be using a low interest card, not a high interest store branded card. If you plan on carrying a balance, which is a bad idea in the first place. You should use a card in the neighborhood of 6%, not 25%.

 

It is a bad mentality to get into the idea of it's only a small amount it doesn't matter. Every penny adds up, and the more you waste now. The less you will have later on.

 

For example. $8 now and $4 (increased 3% each year for inflation, as in your jeans are costing more so your finance charges are going up by 3% each year) each month invested at 6% over the course of 40 years (retirement age) adds up. In this case it will be $12,000. So every penny counts. I am not even going to go into the waste of money for the jeans. Just always keep an eye out for ways to save money. The money is flowing well now, but image if the cash flow stopped. You would feel pretty bad about wasting all that money when now you can't even afford necessities.
 


Interest is a cost of acquisition & convenience. One must weigh out whether the pluses of acquiring something more quickly outweigh the minuses of paying a higher price for it. That's a subjective judgment that each of us can only make for ourselves.

 



+1

I agree.  There has always been that debate regarding AFs card and non AF cards for example.  One will never understand the other on this and it is all subjective. My dad is of a mind that no card is worth the AF and I believe differently.  What's good for one isn't always good for the other and it's a personal choice.  However, I don't at all disagree with the premise that going into debt is a not good idea and paying more then you can afford for a item should be done with great thought to the possible consequenses of the cost.


Starting Score: 642
Current Score: EQ 773, EX 780, TU 777 (All FICO)
Goal Score: 800+

Cards: NFCU Flagship 50K, DC 30K, BCP 28.6K, Arrival+ 25K, Citi DP 22.8K, CSP 20.5K, TotalRewards 20.5K, QuickSilver 20K

Valued Contributor
Posts: 3,099
Registered: ‎10-02-2012
0

Re: What's the Big Deal with APRs?

We are off topic here with the AF discusion, but I will comment. I will edit, because I am only against paying an annual fee for average spending habbits. I think an annual fee is worth the cost if the benefits outweigh the cost. For me and for most, I have not found a card that does. I have the US Bank Flexperks Visa Signature, but the annual fee get's waived. I have not found a card with an annual fee that offers better rewards for most spending habbits.

 

I can see how somebody with high spending say $10k-$20k per month could benefit from paying AF's. They would benefit by having a card for each spending category. Airline, hotel, ect. They would also have the specialty perks that go along with the cards, ie free nights, companion tickets, ect.

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:23    


     $17k       $8.5K          Closed          $19k      $6.5k        $24.2k        Closed         $5k       Closed     $8.5k        Closed      @2.49%
Established Member
Posts: 42
Registered: ‎02-25-2009
0

Re: What's the Big Deal with APRs?

I just have to chime in about the jeans issue...I really don't see spending that much on jeans a bad thing. If OP can afford them, whether it's cash or making payments, then that is great. Not my place to judge. There is nothing wrong with buying nice things once and a while. What fun is life if it's all about money and finances. I hope you enjoy your jeans!! I bet they are fab! The quality of more expensive jeans makes up for the cost as well!


Current: TU (Wal-Mart) 640 EQ (myFICO) 627 EX 628 as of 10/12
BK Discharged 08/10 (The dark times)
NavChek (5000) Cap1 (2500 & 1000) hhGregg (1500) Amazon (900) & WalMart (500) Lowes (300)

Goal: No apps until 07/2013 & 700's across the board
Contributor
Posts: 567
Registered: ‎10-04-2012
0

Re: What's the Big Deal with APRs?

I have found that my AF's are outweighed by the benefits that I receive, but I almost literally live on an airplane. As with most things, it's a value judgment that each of us can only make for ourselves.

FICO 04 scores: 809 (EQ) 812 (EX) 818 (TU)

Amex Platinum NPSL - Citi HHonors Sig. $58k - BMW Ultimate $40k
Chase Sapphire Preferred $62k - Merrill Lynch + Signature $41k - USAA Rate Advantage $28k
NFCU Flagship Signature $50k - USAA Cash Rewards AMEX $28k
Citi Platinum Select / AAdvantage Signature $31k - Chase Amtrak Rewards World MC $41k

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

Re: What's the Big Deal with APRs?

[ Edited ]

knj601 wrote:
I just have to chime in about the jeans issue...I really don't see spending that much on jeans a bad thing. If OP can afford them, whether it's cash or making payments, then that is great. Not my place to judge. There is nothing wrong with buying nice things once and a while. What fun is life if it's all about money and finances. I hope you enjoy your jeans!! I bet they are fab! The quality of more expensive jeans makes up for the cost as well!

They are Fab. Thanks.

 

People stop commenting on this thread. IT"S OVER! IT'S DONE. I GET IT. YOU DON'T. IT'S OK. We are not all meant to understand each other. I'm sure everyone here had bad habits and if purchasing something that you need to float for a while regardless of what it is is your business. 

 

THE POINT I WAS MAKING IS DON'T ALWAYS ASSUME INTEREST ON A CREDIT CARD TO BE A BAD THING BECAUSE THERE IS MUCH WORSE THINGS IN LIFE THAN THAT...THAT'S IS ALL

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
Posts: 932
Registered: ‎06-12-2012
0

Re: What's the Big Deal with APRs?

*crickets* 

JP Morgan Select $10k | Citi TY Premier $15k | PenFed PlatRewards $22k | BofA AMEX $15k | Chase Freedom $20k | Discover IT $10k | Barclay Arrival+ 25k | AMEX SPG $10k | NASA Platinum-Advantage $10k | CapOne Quicksilver $5k | Amazon Card $10k | NASA PLOC $30k @ 8.25% | Joined myFICO 6/12 with a 540 FICO & today I'm over 750!
Community Leader
Valued Contributor
Posts: 1,408
Registered: ‎07-12-2011
0

Re: What's the Big Deal with APRs?

Haha- Right! Apparently we aren't supposed to comment on a statement/question posed to the forum. lol.

Starting Score: 642
Current Score: EQ 773, EX 780, TU 777 (All FICO)
Goal Score: 800+

Cards: NFCU Flagship 50K, DC 30K, BCP 28.6K, Arrival+ 25K, Citi DP 22.8K, CSP 20.5K, TotalRewards 20.5K, QuickSilver 20K

Frequent Contributor
Posts: 470
Registered: ‎08-14-2012
0

Re: What's the Big Deal with APRs?

lol - I still don't think people got the point but that's okay. That's why we have chocolate and vanilla, right?

I do see the point of CC's allowing you to buy things on a payment plan even if you could afford them outright, but I also see the point in who would want to pay the interest if you did not have to. In some cases, it is often the latter that starts leading into a life of debt and eventually bankruptcy because one starts to think they can truely afford stuff when in reality they cannot. As for the OP, I think he's made it clear he can afford these purchases. But, others who have been or helped people in debt situations, could attest that the difference between what you can buy and what you can afford begins to blur and eventually leads to high credit card balances and interest that begins to spiral out of control.

Also, not everyone especially young adults starting to build credit in a fragile economy have had the opportunity to build a nest egg yet. They care about APR because these days, it almost seems there is no "secure" job so they like to know that if they have a low APR CC, they could float themselves between unemployment and still be able to cover the necessities in life and pay it back faster (lower interest means you can apply more of what you can afford to principal and not interest).

Therefore, APR means many things to many different people. To some, its the ability to get by in tough times. Others, the ability to pay for something over time. And to someone in deep in debt for whatever reason, it is the worst thing on the Earth.

In my wallet: Amex PRG & Zync, Amex BCE (19.2k), Chase Freedom (5k), PSECU Visa/PSL (20k)
Current Scores: Equifax: 738 (Fako) TransUnion: 721 (Fico) Experian: 717 (Fico)
Disclaimer: I am by no means a financial advisor. My posts are based on opinion, experience, and/or knowledge.
Advertiser Disclosure: The listings that appear on myFICO are from companies from which myFICO receives compensation, which may impact how and where products appear on myFICO (including, for example, the order in which they appear). myFICO does not review or include all companies or all available products.
† Credit cards for FICO Score ranges: The score ranges are guidelines based on actual applicant approvals and having a FICO Score in a particular range does not guarantee you will be approved for credit cards recommended in that range.

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.