Big day of my life..

Pay the darn thing ahead of time if you have to!
Don't try to buy something that you don't have the cash for.
 
I disagree with those who say credit cards are worse than debit cards. I understand why they say it from a personal responsibility issue, but from a fraud issue, the credit card is much better. If your debit card number is compromised, your checking account can be immediately emptied, and it's your responsibility to prove it wasn't you who made the purchase. You'll PROBABLY get your funds back eventually, but you may not, or it may take months. With a credit card, you're limited to a fifty dollar charge at most. If the fraud is on the internet, zero liability. If a billing mistake is made, you can contest it with the credit card, with the debit card the money's gone until you prove otherwise.

I think the credit card is better IF you're responsible, but that's a tough thing in you're late teens, early twenties. Maybe the debit card is better for some.

If you have a credit card and are only going to use it for purchases infrequently, and think you might possibly use it too much because it's so convinient, do this. Put the credit card in a zip-lock bag, fill with water, place in freezer. That way you will be a bit less likely to make that instant impulse purchase.

Knowing what I know today, for a somewhat responsible person, I prefer the credit card in the freezer, over the debit card in the wallet.

Also, NEVER pay by check over the phone, NEVER.
 
These guys are giveing you a wealth of knowledge. I wish I would have asked their opinion before I got in debt up 2 my ears. Sometimes we have to lern the hard way. Get yourself a Benchmade. Some gun and knife stores have nice law-a- way plains. Spiderco Delica is a nice one that won't break the bank.
 
Heh 'break the creditors' you mean.
Unfortunately, I'm in CANADA and not only that, but in SUBURBIA so there are no gun and knife shops here :eek:

Great information, this has ALREADY prevented me from purchasing some fancy stuff on ebay I would have otherwise impulsively bid on. Great stuff guys, thanks a lot.

The Leek however is 30 mins away from my grasp. MUAHAHAHA, I hope it ships here before prom. It should be a nice addition to my tux
 
Everyone that has told you to cut it up has good points. But the ones saying to get a debit card aren't offer too much of a better solution.

First of all a debit card does not help you build credit. Credit is important for everything from renting a college apartment to buying your first car.

Second, debit cards don't protect you from overdrafts. You think you can't go crazy and buy everything with a debit. You sure can. It's called overdraft protection. It helps AND hurts you.

Third if a dealer defrauds you, debit cards really suck at getting your money back. I am not saying they won't but CC companies make it very simple to fight charges.

I got my first credit card when I was a freshman or sophmore in college. Spend alot of time researching NO fee type cards, preferbly ones that will give you some sort of benefit such as cash back. I never applied for student cards because I always felt they were cop outs. Worst about student cards is the 20% APR they try to rape you with. YUCK.

Pay all your bills off monthly, don't spend more than you have or more than you expect to have come in and your credit score will rise.

Do all this and you'll be a 21 year old with a FICO score of nearly 750, like me :) Find me a bunch of adults that come close...
 
Put it to you like this dude - most people in this country have ten's of thousands of dollars in debt, and most of them started in exactly the same position as you.

I wound up having to cash in my entire savings to get out of debt, but I don't regret it a minute because debt was a heavy monkey. Don't make the mistakes I did. The best way to get out of debt is never let it pile up in the first place.

Nowaday's, I only use the credit card for purchases I'm going to pay off immediately - nothing revolves. My last major purchase was my motorcycle, last year. It was paid for that month, and the card hasn't been used since.

18% interest is insane - so why let the credit card company make money off you? As long as you treat it like a debit card without overdraft protection and pay it off immediately, you'll be fine.

Nothing will get you good credit other than paying your balances & time.
 
upon further consideration.....

this will help you build credit AND not dig your own grave: get a CC with a low limit -- LOW -- like $200. $10,000 may look cool, but it's not so cool when a year or two later it's - $10,000.

OR, get a secured card -- that means that you have to put money on it before you can use it. this will allow you to make your online purchases, and not rack up debt.
 
Originally posted by NFMee
upon further consideration.....

this will help you build credit AND not dig your own grave: get a CC with a low limit -- LOW -- like $200. $10,000 may look cool, but it's not so cool when a year or two later it's - $10,000.

OR, get a secured card -- that means that you have to put money on it before you can use it. this will allow you to make your online purchases, and not rack up debt.
Click to expand...

Well said. My limit is only $1000 CANADIAN which amounts to a mere $710 USD so no worries. Keeping a mini-balance book in my wallet now (sheet of paper) where I keep track of every penny that goes through my bank (where I'm depositing to pay CC bills) and cards. Looking good so far, I'm 5.07 over at the days end and I have two leeks purchased :)
 
When I was your age I got my first credit card. Then I got a high maintainance girlfriend who turned into my practice wife. Then I got more credit cards. Finally at 26 I parted with the practice wife and went to Bankruptcy Court...:( I accidentally got in way over my head over the course of a few years and completely ruined myself financially.

Your FICO score is also called your credit score. FICO is based on what's called the Fair-Isaac score which is a statistical computation of the probability that you will repay the debt in a timely fashion. There are three main credit reporting agencies in the US (Equifax, Experian and Tans-Union), and they each use a variant of this method to evaluate a person requesting credit. Virtually all financial institutions use these credit scores to determine if you're credit worthy, and what level of risk you represent and that determines what interest rate you pay.

Keep this in mind. If you ran up $1000.00 in credit card debt, then cut up the card and never charged another thing, by making the minimum payment, it would take nearly 30 years to repay the debt and cost you many thousands of dollars when it is done!

The posts above are right-on about fraud protection being WAY better with a real credit card vs a debit card. A credit card is also a good way to build your credit if used correctly. Charge something, then pay it off right away. Calyth has a great idea about pre paying a purchase. Send the check to the credit card company at the same time you make the online purchase and you get the benefits of using a credit card without the negative side effects. The other negative about a debit card is that most of them have a daily spending limit which can prevent you from making a large purchase. With Bank of America it's $700.00 per day. This one bit me in the ass several years ago when I was in my early 30s and still recovering from the BK years before. I went to a trade show with my boss and went to check into the hotel but because it was a $150.00 per night hotel, my debit card wouldn't take the charge for the room for a week even though I had plenty of cash in my account to cover the charge. I was quite embarrassed to say the least.

I'm happy to say that today at 40 I've rebuilt my ruined credit and have a top shelf credit score (over 750). It took many years of hard work, but now the only debt I have is my mortgage and an equity line of credit that I use for things like auto purchases so I don't have to deal with the car company's high interest rates. I have a couple Platinum cards with high limits and NO BALANCES! I use them regurlarly for purchases both large and small, but pay them off in full each month. This helps me to get more rewards points!

The rule of thumb I use that I learned after Bankruptcy is that if I don't have the money, I don't buy it. With zero credit after BK (no one would extend any to me), I had no other option.

One more thing, these days many of the better jobs require a good credit score. The thinking is, if a person can't be financially responsible in their personal life, what kind of employee would they make? A guy with a poor credit score is more likely to steal, have car trouble he can't pay for, etc...

Credit is an important part of modern life, but is a double edged sword. Like anything sharp and pointy, be careful.

jmx

PS: Where's Gollnick when you need him? He'd have saved me a lot of typing here by explaining this all before I even saw the thread.
 
Is there any way of finding my NICO score?

Well, hopefully this daily balance thing will work out for me
 
First of all congrats.

Well, let me give you some advice. I got my first credit card about a year ago too when I was 18. At first I made real sure that I had money to cover every charge I made. I kept up real well for almost a year, then I started making small sharges I couldn't cover. I haven't let it get away from me that bad, but I warn you. It is real easy to just charge somehting and say you will pay for it by the end of the month somehow. The hard part is that somehow, you will eventually have to pay for everything you buy. If you start spending lots more than you are able to pay the interest will get you quick.
 
You can request a copy of your credit report from each agency. I think you can get one free once a year from each agency, otherwise there's a nominal charge.

You can also try here:

http://www.freecreditreport.com/

although I'm a little hesitant to get a credit report online.

Sometimes you can get a 3 agency credit report as well that combines all three. This info is for the US, I'm not sure about Canada. I know your mortgage laws are different up there (weirder).

In the US, when you buy a house or refinance one, they pull a 3 agency report.

There are also credit monitoring services which people with good credit subscribe to to make sure nobody is trying to pull an identity theft and use their good credit for fradulent activities. These credit monitoring service will usually provide a 3 agency report once a year as part of their services.

jmx
 
You are only as good as your word. Unfortunately, the FICO score is the only proxy available the society at large to measure your word.
 
Well everyone used to tell me that when I get a credit card I shoudl buy little things like candy or whatever on it to build up a good credit rating. Too bad that site doesnt work for Canadian credit reports
 
Where's Gollnick?

I'm here.

As has been pointed out, credit cards are a major double-edged sword. Both sides are razor sharp.

Modest, responsible use of a credit card can help you build a good credit history that will help you rent an appartment, get a job, etc. It can also help you get approved for responsible and necessary loans that you may eventually need, school, a car, a house, etc.

Irresponsible use of Credit Cards leads many to a hell-hole of debt and even bankruptcy. Credit is the leading cause of bankruptcy.

A credit card can also be a good backup for a TRUE emergency. But, wanting a fancy new knife is probably NOT an emergency. What is an emergency? Your house just burned down, you're now homeless and you need a place to stay tonight, some cloths to wear, a toothbrush, etc. You're on a trip and the airline just lost your suitcase with your twenty-dollar-a-piece heart pills in it. Your doctor will phone the prescription to a local pharmacist, but the only pharmacist in town doesn't take your brand of health insurance and insists that you pay before he'll give you the pills... and you're starting to feel chest pains. You're at school, fifteen hundred miles from home when the phone rings; it's your father. There's been a horrible accident. Your mother isn't expected to live much longer. She's asking for you. You need airplane tickets home NOW. In fact, you need to charter a Learjet, now! These are the sorts of true emergencies where it's ok to charge now and figure out how to pay next week.

Your credit report score goes up everytime you charge something and then pay for it. So, be sure that every month you charge something. A $10 lunch is all that it takes. And then, be ABSOLUTELY sure to pay it off every month on time. Make a rule: except in a true emergency, don't charge something that you couldn't pay for in cash if you wanted to. Make a rule: except in a ture emergency, pay the full balance on-time every month. Make a rule: declare a true emergency only when the need is very real and you have no alternative. Basically, you've lived 18 years and haven't had one yet.

A credit card is a serious adult thing. It's a bit like gun ownership. It's a serious responsbility. It can hurt you or it can help you.

My strong advice to you is treat your credit card with the same care and respect that you would a loaded gun.
 
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