PIF all the time...really?

[MarineVietVet]

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@jefftca925 wrote:

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 

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I agree 100% with this. My point was that some (very few) people talk like it is some kind of crime and hint that there is something seriously wrong with anyone who dares to carry a balance or pay even one penny in interest ever.

And yes there are posters with that attitude. Luckily though they are few and far between but they do exist.

My advice is still the same. Try as best you can to always pay in full and not pay any interest if at all possible but also realize that a few dollars interest (notice I say few) is not anything to lose sleep over. There are so many more important things in this life to be concerned about.

Just don't let it become a habit and let that few dollars become many. 

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

[Anonymous]

I guess it depends on your situation. I PIF because I'm a modified Dave Ramsey follower, lol.I believe in no debt, but I refuse to give up my cards...they are essential to everyday life. However, my monthly household budget is in the thousands, so I am able to pay because I've made a budget to pay. If I have a large purchase like a tv or treadclimber, I save the cash first, then buy it on the card, then PIF. That way, I get the satisfaction of no debt without paying interest and mega points.

[Anonymous]

I feel the same as the OP. Hey, it is great if you CAN PIF every month, but we're not all reading/posting on a credit forum if we all had pristine payment history and financial planning.

I know for a fact, at one time when I was in my late teens/early 20s (AKA the young, stupid era), I considered 'available credit' as another way of saying 'disposable income', which was...well stupid. That methodolgy led me to being in a mountain of debt and hurt, financially, but I recovered.

Now, anytime I go out, if I open my wallet, and even consider using a credit card, it is akin to someone stabbing me in the eyeball. I loathe even considering using a CC. Is that a bit overboard? Probably, but at least it is having the control to not use credit just because you want something.

I currently have a balance on only one card, the Citiy Simplicity: $1600 from Christmas, and I'm leaving it there for a while, because of no interest until April 2013.

[Gollum]

I PIF my lowest-interest-rate CC.  I don't care about rewards.  If I ever have to carry a balance again against my wishes, I would like the interest rate to be as low as possible.

I carry a balance on my oldest, highest-interest-rate CC with the highest limit.  It is sock-drawered because I hate that bank.  I choose a balance amount that results in approx. $50 annually in (mostly) interest.  The card has no annual fee, so I want the bank to have enough annual income to replace the annual fee so they don't close the card.

[Cdnewmanpac]

A few thoughts: First, the issue of responsibly carrying a balance comes down to opportunity cost. For example, we recently purchased a high efficiency furnaceon a credit card with a current apr of 6.99%. We knew it would take 3 months to pay off, so we would make at least one interest payment (not insubstantial on a $10k purchase). However, the opportunity costs (both financial and subjective) of using the old furnace for 3 more months while saving to pay cash were higher than the interest we paid by carrying a balance. The new furnace did cut our electric and gas bills. It also massively helped our allergies (something I'd gladly pay for) and led to a more comfortable house during the peak of winter. Totally worth what we paid in interest. So blanket statements about the advisability of pif ignore the very real benefit of borrowing money and paying interest. Second, we all use credit cards in a different way. There appears to be an element on this forum that are using cards purely to drive up their fico scores in some sort of competition, like betting on cockroach races, etc. Some of us use it for business expenses we expect to be reimbursed for. Others for miles, extended warranties or other rewards. The definition of responsible use cannot be separated from the intent of the use. But in a forum like this, made of people obsessed with their scores, I think you are going to select for people likely to pif rather than carry a balance. Ask people on a bipolar disorder support forum about their credit card habits and I assure you the answers will be different. Not evidence of lying, but a product of the audience you are sampling.

[learnin113]

To the OP, this is an excellent thread...and I feel ya on all levels.  From the moment I joined this board, I find 2 things a bit disingenous...the way that people always claim to PIF and kinda act like there is no other way...really?  In this economy???  Secondly, I almost feel being honest with posters who appear to be doing foolish things is strictly prohibited.  You're automatically cautioned of being too harsh.  I believe for the most part, most of the posters have either had credit problems in the past or no credit at all, so they should not be making the same mistakes over and over again.  They should be told exactly what the consequences of their actions will be...the sugar coating or kid gloves I think is dangerous.  And I'm glad this thread was started so I could get the courage to say it.

BUT everything else is super on here...so Mods...I'm hoping no AA.  I'm just throwing in my 2 cents.

[cahiatt]

I pay in full now. But for MANY years I never did. Never could. When I was younger as I'm sure it is with a lot of people you always want the latest and greatest. Easy. Just charge it....

At any given time I was probably rolling over $2k to $15k in credit card balances every month. I was always able to make the payments though. The problem was my line of thinking at the time also. My budget was always around "the monthy payment". I didn't really consider the purchase price of the item but cared more about can I afford the monthly dues to keep it. It was probably two or three years ago when I actually sat down and looked at my budget. How much was I spending every month on interest alone.

I finally got all my cards paid off about 1.5 years ago and been trying to keep them that way. The money I used to spend on interest and payments just goes into savings. If I need to buy something I'll still charge it but only if I have enough in savings to cover payoff or use an interest free promotion (Sears/Home Depot) to pay for it. I also try to use cashback cards. The wife and I put EVERYTHING through the charge/credit cards to earn points and pay it off at the end of the month. I also put my work related travel through them also.

The difference in treating my budget this way is huge. I went from spending $200 to $400 per month in interest alone to earning $50 to $100 per month in cash back and interest on my checking/savings accounts. That's basically a free car payment every month.....

[learnin113]

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@JusdoNit wrote:

LOL.  This is a hot topic

Over here we have nothing but love for the PIFer's.  I just wish they would let me know when it is "open season" so I can enroll in one of their programs.  I have some cards that would love to be PIF'd any month.  Let me know where to send them to.  I have my own stamps. ROTF...LMTO

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Word.

[nomoore]

For so many years I didn't PIF. I paid minimum payments and occassionally a larger payment on my one CC with a 19% APR. I would buy an occasional large item with it thus negating the payments I had made. Then one day it hit me how much money I was losing to interest and that basically I was never going to pay it off. If I didn't do something about it I would be paying this interest for the rest of my life. So since I actually had fairly good credit I got a personal loan to pay the $5500 balance. This way I knew I would be paying it off in 5 years. I then sock-drawered the card for a few months. I had had enough of paying interest on a CC.

Then I started learning more about the benefits of using credit cards for every day transactions. That's when I started using that CC like I would a debit card. I used it for everything that I would normally use my debit card for. I looked at it as I would a debit card. I balanced it like a debit card, never charging more than I had "right now". This did indeed allow me to PIF. I was putting 500-1000 dollars a month through it and not paying interest.

Hard times? Yes I had those. At first I was obsessed enough with never charging what I didn't have that I was able to refrain from this detrimental (to me) spending pattern. I just put off buying stuff or services that I really needed. Then I figured out that I can get behind by about $800 and still be able to PIF. Then I could catch it up when I wasn't in such a bind financially. And because it still bugs me a lot to not have the money to PIF immediately I do actually catch back up. So that's how I deal with the emergencies.

I now earn rewards with a better CC and actually make money from my CC instead of paying interest. I also have the security of knowing that if I ever DO need it for a larger emergency it is there for me. But it would have to be a pretty SERIOUS emegency for that to happen. And besides, I could take out a personal loan pretty quickly if I needed to.

I can honestly say I put about $1800 a month on my rewards CC and I PIF every month. I don't always have the money to PIF immediately but often I do. I have been using my card this way for about 2 years now and have never paid interest. I plan to never pay CC interest again, ever.

Credit cards mean different things to different people. If your attitude about it is that you can buy stuff now and pay later then guess what? You are going to really pay for it later. Buying something NOW when you can't afford it is going to cost you. You will have less money to buy stuff later (except for a very disciplined person combined with a 0% for X months deal).

P.S. Technically I still pay interest on stuff I bought on credit a long time ago. I'm still paying on that personal loan that I used to pay off my CC 2.5 years ago. But this is no longer debt on my CC and it does not affect how I have used my CC for the last 2 years.

[haulingthescoreup]

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@learnin113 wrote:

To the OP, this is an excellent thread...and I feel ya on all levels.  From the moment I joined this board, I find 2 things a bit disingenous...the way that people always claim to PIF and kinda act like there is no other way...really?  In this economy???  Secondly, I almost feel being honest with posters who appear to be doing foolish things is strictly prohibited.  You're automatically cautioned of being too harsh.  I believe for the most part, most of the posters have either had credit problems in the past or no credit at all, so they should not be making the same mistakes over and over again.  They should be told exactly what the consequences of their actions will be...the sugar coating or kid gloves I think is dangerous.  And I'm glad this thread was started so I could get the courage to say it.

BUT everything else is super on here...so Mods...I'm hoping no AA.  I'm just throwing in my 2 cents.

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A comment, and I'm not speaking specifically to any of your posts.

I'm all in favor of tough love when needed. I dish it out all the time.

But there's a difference between tough love and bashing. We see way too many posts with some variant on "I can't believe how stupid that is", or a similar vibe. It is possible to point out something without adding a frosting of personal insult, although it might take a little reviewing of the draft post followed by some editing. It's made more difficult by the fact that these are written words on an online forum that can't be modified by gesture or tone of voice. Things often do come out more harshly than intended; I've done it myself. If the person that you're trying to help feels attacked or insulted, he or she will simply leave without being helped.

And it's very possible that sometimes we mods over-react, especially if the member offering the criticism has a history of attack posts or other issues. We try not to, but we're all human.

In the end, we're trying to make the forums a place where people come to learn and to share, and help one another out. Having Triumph the Insult Dog offering commentary doesn't advance the cause.

And of course, no "AA", as you put it. Why would there be? The mods are just a bunch of volunteers, often (ahem) sneaking on during working hours, trying to keep things chugging along. I wouldn't try to speak for the other mods, but I welcome feedback. It's all part of the process of continual improvement.

Unless you insult my cat (in my avi), of course.