PIF all the time...really?

[Anonymous]

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@navigatethis12 wrote:

I have paid in full since my first card two years ago and never plan on not doing so. The only times I do not is when the annual percentage rate is 0% for a certain amount of time (Amazon Store card). If you pay interest on a rewards card then most likely any rewards you accumulate will just be paying back the interest.  I guess one way to make sure you pay in full is just not charge more than you know you can afford. You could also just use a debit card.

To me it's also the whole principle of paying interest. I'm someone who won't pay for something that I do not have to. Just like I would never obtain a card with an annual fee. Fees in general are things that I avoid at all costs.

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+1

If I like our business relationship I will use your card to buy gum, pay storage, and date night with the wifey! Get your interest elsewhere!

[frogfan12]

Thanks OP for keeping it real. 

[aussiesareforever]

While I agree that people most likely make up stories sometimes, I think it is very possible to PIF every month. Given my previous credit troubles, I never buy what I cannot afford to pay off when my statement comes in.

The only advice (and probably most helpful advice) my BK lawyer gave me was "get a new CC, use it for gas and pay it in full every month.

I have listened to him for almost four years now and strive to live within my means. However I understand life gets in the way sometimes and I feel very blessed that I haven't had rough circumstances that will make me depend on my credit limit instead of my checking account balance for my daily bread

[JustMe77]

The last time I carried a balance was over a year ago, and even then I didn't absolutely have to carry a balance. I just wanted to carry the balance to save up some disposable cash. I can PIF everything because I pay for absolutely everything with my cards (except certain bills that add fees to do so, like my utilities), so my paycheck basically just goes to the credit card company. I'm a PIF-er, but only because I use the cards like debit cards. 

I just can't stand the thought of paying interest. My cards all have really high interest rates (22-25%), except Orchard (15%) but the Orchard has a crazy $79 AF. 

[CreditScholar]

I charge $3-4k every month (sometimes as high as $9k), and agree that it is possible to PIF every month. Granted I have a decent income, but there's a huge difference between treating credit as cash vs. using credit in place of cash. If you have expenses that you would have paid for anyways (through a check, cash, debit card), you can charge them all and PIF. You're not slogged with any interest, and you reap rewards at the same time. This is treating credit as cash, because it temporarily substitutes for cash you would have paid out in little pieces. However you have the cash already for these purchases.

Where most people get into trouble is when they use credit in place of cash (typically that they don't have). For them it could be buying things they simply can't afford (even if they REALLY need it), impulse buys, emergencies, or as a stop-gap measure for large expenses.Then they get slugged with declines at the register, overdraft fees, late fees, etc. I find that these people are the ones who complain most about credit cards, and have the most negative views on banks. This is using credit in place of cash.

Most people who fall into the second category either are spending beyond their means, don't have much savings, and/or simply can't track/control their spending 1 month in advance. Yes there will be some people who say "but I have medical bills that needed to be paid and I couldn't afford it or didn't have the cash". The sad truth is they don't care what the bills are for, it's just money owed to them. That isn't the lender's fault, they're in business to make money and everyone has a choice whether they use credit or not.

[Odiseous]

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@CreditScholar wrote:

I charge $3-4k every month (sometimes as high as $9k), and agree that it is possible to PIF every month. Granted I have a decent income, but there's a huge difference between treating credit as cash vs. using credit in place of cash. If you have expenses that you would have paid for anyways (through a check, cash, debit card), you can charge them all and PIF. You're not slogged with any interest, and you reap rewards at the same time. This is treating credit as cash, because it temporarily substitutes for cash you would have paid out in little pieces. However you have the cash already for these purchases.

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+1

I have a strict mentality.... Credit Cards are simply "Debit Cards on Crack". I don't charge it, unless I *already* have the money to pay off the charge in my checking account.  Note: Switching from a "Pay cash for everything" policy; to a "charge it for the rewards, then PIF" was a bit of an adjustment. But it's earning me extra money; so I stick with it. 

[Anonymous]

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@CreditScholar wrote:

I charge $3-4k every month (sometimes as high as $9k), and agree that it is possible to PIF every month. Granted I have a decent income, but there's a huge difference between treating credit as cash vs. using credit in place of cash. If you have expenses that you would have paid for anyways (through a check, cash, debit card), you can charge them all and PIF. You're not slogged with any interest, and you reap rewards at the same time. This is treating credit as cash, because it temporarily substitutes for cash you would have paid out in little pieces. However you have the cash already for these purchases.

Where most people get into trouble is when they use credit in place of cash (typically that they don't have). For them it could be buying things they simply can't afford (even if they REALLY need it), impulse buys, emergencies, or as a stop-gap measure for large expenses.Then they get slugged with declines at the register, overdraft fees, late fees, etc. I find that these people are the ones who complain most about credit cards, and have the most negative views on banks. This is using credit in place of cash.

Most people who fall into the second category either are spending beyond their means, don't have much savings, and/or simply can't track/control their spending 1 month in advance. Yes there will be some people who say "but I have medical bills that needed to be paid and I couldn't afford it or didn't have the cash". The sad truth is they don't care what the bills are for, it's just money owed to them. That isn't the lender's fault, they're in business to make money and everyone has a choice whether they use credit or not.

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+2 great way of putting it!

[Anonymous]

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@Anonymous wrote:

I'm going to tread on what perhaps might be "touchy" ground, but I feel that I have to touch upon this.  In reading many threads and posts over the many months I've been on these boards, it seems that a lot of folks claim that they "PIF" their balance every month.  Then I read other posts wherein these same folks talk about how they've run up their balance to however many thousands of dollars and consistently PIF the balance every month and doing this over several cards.  Or so they claim. I for one know that I do not PIF the balance every month and I make a pretty decent income, if I do say so myself.  If I've only charged up a small amount, yes, PIF is no problem and I'll quicly do that.  However, if I happen to run up a large balance or have made a large purchase then I will definitely try to float it for 2 or 3 months.  And I feel no shame in doing so and saying so.  I sometimes get the feeling that some folks on these boards are "frontin'" like they PIF every month but they really don't.  If you've got it like that and can do that, then kudos to you, and that's great.  But the reality is that there is nothing wrong with floating a balance if you can.  If you're only paying the minimum amount due, then yes, that's probably going to be problematic and viewed negatively, but I doubt if creditors are sweating you if you don't PIF every month.  Clearly with the AmEx charge cards PIF is a must but for the revolving cards, it's not as essential and it's not essential to pretend that you do.

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If you are living within your means you should be able to PIF every month regardless of your income.  Purposely leaving a moderate to high balance instead of PIF when you have the money to PIF is just silly.  You are paying unnecessary interest fees.  Creditors also don't care if you pay only the minimum.  The only creditor who will know you have only paid the minimum is the creditor you are paying.  The less you pay on your balance, the more interest they get to charge you.  Minimum payments are a win-win for creditors; they get some payment, plus they get to charge you more money.  Say you have $100k saved up and someone asks you to borrow $1000.  You give them the loan and they agree to pay you back a little each month, with interest.  You've got $99k in the bank and you aren't really missing that $1k, so where do you stand to gain most?  Them paying you back the minimum agreed upon each month?  Or paying you back in full 1 month later?  That's exactly the situation with CCC.  They give you X amount to spend with understanding that you will repay them.  Do you think AMEX cares if you rack up a $10k balance and then pay them $100 every month until you finally pay it off?  Heck no, they'll profit a ton off of your poor credit management.

I'm not sure why you felt the need to try and call out people for lying, or "pretending" that they PIF when they really don't.  Many people here are open about not PIF and actually try to keep a certain balance in order to maximize their score each month.  PIF does not make you cool, and certainly does not make you better than anyone else, so I highly doubt anyone here is lying about PIF; they have nothing to gain from lying about it.  

The longer you spend here, the more you'll see that a lot of us have credit cards in order to maximize rewards and get as much money back each year as possible.  Carrying a balance and paying interest is counterproductive to that goal.  I personally have been PIF my monthly charges since about June, but only recently finished paying off old CC debt.  Luckily all of that debt was on a card during its 0% introductory period.  You will also notice others who love to keep their score as high as possible, so they carry a 1-9% balance every month.  The interest they are paying is minimal, since they are carrying such a small balance.  

[jefftca925]

I saw this thread posted and felt the need to throw my two cents in.  I am a proud member of the "PIF" club and I have done so for the last 4 years.  The ONLY time I've floated a balance is when there was a 0% financing offer attached to the purchase.  Even then I've paid them off within a few months.  I don't make a boatload of $$ but I do feel it's important to spend only within your income and make it a point to always put $$ into my rainy day fund every month.

I wouldn't read to much into the claims of folks charging thousands of dollars every month and PIF as there are probably extenuating circumstances that make this possible and a necessity (i.e. large family, business expenses, etc.).  I think the important point here is to keep your spending on CCs in perspective and under control to prevent ourselves from falling victim (AGAIN!) to the belief that material happiness is only a card swipe away.

Charge ONLY what you can pay off quickly (especially recurring monthly expenses), put some bucks away in case you someday need the money in the event of an emergency, and ALWAYS stick to your financial game plan.  Not being a PIFer every month is not a crime but floating thousands of dollars every month in CC debt is just financial suicide to me.  I like sleeping at night 

[Anonymous]

Just a minor note, letting a balance of 1-9% report doesn't necessarily mean you have to pay interest on it. It is simply referring to not PIF before the statement generates each billing cycle. You can then PIF anytime after that but before the statement due date and not accrue any interest.