60+ year old thread.

Good morning guys and gals (I hope I didn't offend anyone with the misuse of outdated cultural depictions of pronouns). The kids have finally figured out that I'm retired. I'm off this morning to drive 50 miles to my son's house. I'll be painting the baby room and hanging a ceiling fan for my grand-daughter coming in November. Remember that a phone call with a "hey dad" is going to cost at least $100 or more. Have a good day everyone.

 

Oh for sure.
No one calls me (family or friends) 98% of the time unless they need something.
I expect nothing else…
So I’m not disappointed..

 

Credit rating companies go with the information they have. Credit card statements generate those reports, so no statement, no report. I’m no longer paying current balance down to zero for that very reason. Pay the statement balance and let it go at that. I like to use those zero interest installment gimmicks also. I did a heat pump that way, a small monthly payment stretched out over 3 years is like free money in these inflationary times. Just set up automatic payments and forget about it.

 

Along with utilities and such. Property taxes. If someone has the financial means to get to the point that they buy vehicles and homes for cash and has a history of keeping up with their utility bills and property taxes I don't see how credit (Edit) agencies (delete card companies) should be able to ding their credit. The system is set up to get people to incur debt as though that is a good thing.

That's something I should check out.

Any interest paid is taking away from interest made. If you have a 4% mortgage and are making 8% on investments you're earning half of what you could be earning on an equal amount of money. Lenders get rich loaning money. I've never heard of anyone getting rich by paying interest. Paying interest is taking money out of any profits being made.

 

Afternoon all:

Same here, I have the 66 insured through Hagerty, much cheaper than what my regular insurance would be, and I can also insure it for stated value.
When I inquired at another specialty ins. co. and told them the engine was blueprinted, they said it wasn't stock ???????? , IDIOT!
Hagerty didn't seem to have a problem when I mentioned that, so I went with them and have been with them for quite a few years.

 

I’m pretty savvy regarding finances but don’t really understand credit scores. We use credit cards lots but pay them off every month, no exceptions. Otherwise we pay cash for things. We paid cash for our house built 8 years ago (our prior house had been paid off years before), paid cash for our vehicles, last one was a 2020 Hylander , cash for the boat and everything else.The only things we pay monthly are things like utilities, water, garbage etc. etc. Our credit score is over 800. That’s about as good as it gets.
For me it was important to be 100% debt free when I retired. We actually accomplished that goal years before I retired. My financial consultant explained to me how some debt like a property mortgage maybe financially advantageous. But I’m old school and bone headed and zero debt is where I want to be. That’s just me though. Mark mentioned that he has a mortgage at 4%. He’s also mentioned in the past that his wife is a cpa. Well when it comes to money, taxes etc. you just don’t get any smarter than a cpa, so he knows what he’s doing.
The thing is I planned for and prepared well for my retirement. I was just fortunate I could do that.

 

Evening all:

We think alike Ken, looks like I'm old school also! I have only one credit card that has cash rewards of 3% on gas, that's the main reason that I have it and pay it in full every month. Sometimes when I buy something off of the internet that's not available locally, and they don't offer pay pal, I will use the CC, in that case it's just convenient.

 

I don't know my credit rating, but it is apparently very high. I have been living debt free for nearly 50 years.

 

If you don't know... then why do you think it's high? I thought mine would be gold... until I found out the insurance companies were charging me more because I pay cash for everything. Do you know if you are getting charged extra for car/house insurance?

 

As I understand it, it isn't so much as not "qualifying as making regular payments" as it is, "not making any payments at all". Why? Kind of a long story...

Over the last year or two my wife and I started looking to get back into a house after having "downsized" in 2013, so I thought I'd do a little research on credit ratings and such. I signed up for the myFICO credit monitoring service, and was kind of surprised to see my credit scores (especially the FICO 8 scores) took a pretty good whack some months and bounced up other months. Browsing a few credit related forums I learned there is a highly complex set of metrics and analytics involved in the calculation of 30+ different FICO scores; for those trying to maximize their scores for say, a new car loan or better still, a new mortgage, you should practice what is called an "AZEO" (All Zero Except One) payment model for your revolving credit cards. Basically, pay off all of your cards to zero immediately before they report to the credit bureaus except one card which should have a sub-$100 balance reported. Given I always pay my cards off immediately prior to each due date, some months I had all cards showing a zero balance, most months showed one card with a small balance (basically a latent charge which cleared between the date I paid the card off and the statement date), and even a few months where I had a few cards showing small balances. As the AZEO model predicted, my scores were typically 800(ish) on months where all cards reported zero, 830-840 for the months where one card had say a $50 balance, and then back down to 810-820 for months with more than one balance.

What was also interesting was a month where a card which had always had a zero balance reported (even though I'd moved a few thousand per month through the card) suddenly reported a balance; red flags went off all over the place for an unusual trend and a "dormant" card coming back to life. This last bit ties back in to my premise above, if a card is ALWAYS paid off every month and reports a zero balance, the various credit bureaus considers that card inactive, and if every card reports zero every month, that means you effectively have little or no credit activity and that hurts your scores.

In the end I played the AZEO game for about 18 months to get a good feel for how my scores would react, and then cancelled my subscription.

 

THAT is very interesting. I'm going to look into that.

 

Don't bet on it!!!
I also paid for everything and had NO CREDIT RATING. I couldn't even get a credit card when I wanted one. Luckily I had some leverage and threatened to pull my accounts if Bank of America, who owns Merrill Lynch, didn't give me a card, they did not want to lose those accounts and they issued me a card!

 

One of the other things I learned from my credit research was about how valuable rewards credit cards could be. Me, I'd always stuck with my moldy-oldy credit cards I first got back in the late 1970s and early 1980s, and other than a short lived airline credit card, I never took a dip into the rewards pool. Two years ago this last June I finally wized up and picked my first rewards card (3% dining, 2% gas and groceries, and 1% everything else), and then added a few more specialized cards after that; since June of 2020 I've already earned $2,000 in cash back rewards. While two grand isn't HUGE money, it is certainly two grand more than what I would have earned if I'd stayed with old cards. Yeah, adding those four new cards has hurt my average age of credit a bit, but not enough to significantly hurt my scores.

 

I was at Sam's Club one day buying a paper shredder, the cashier asked me if I wanted a Sam's credit card. I said no.

She said it only takes a minute for approval and you get an instant $50 off your purchase. $50! - I said sure.

What I noticed is it pays cash back 5% on gasoline always, no messing around with websites, etc.

I buy all my gas with it and pay off every month, I went to Sam's to buy a pressure washer and had enough cash back built up it cost me $5.

 

That's another thing I ran into. I've been keeping a low limit credit card ($500) just for internet purchases and in case I needed to rent a car or book a flight... and eventually I ran into something I wanted that would have cost over the $500. I asked them to increase the limit and they wouldn't because my credit rating was low... even though I pay the card off every month. I don't know... but maybe they consider anyone paying off their card every month as a deadbeat anyway.

So I went to a bank to get a higher limit credit card and they wouldn't issue one without a bank account of course, and to get one with a high limit the account would have to be active for a few months and the higher the balance the higher the limit on the card would be. They had no sympathy at all for me paying cash for everything, and even seemed skeptical when I told them my experience. They got a lot more polite and interested when I made a substantial deposit.

 

Dale, I almost exclusively use mine for gas, so I don't rack up as many rewards as you do, I usually request a check when i have $100 in rewards, I just recently got another check for $100, think it was the fourth one. I opted for the 3% on gas, also have the 2% and 1% on other things.

 

Yeah, not all rewards are created equal; the rewards from CapOne are by far the easiest to use, especially if you shop Amazon a lot. After the first time I used my CapOne card on Amazon (and saved it in my Amazon wallet), they linked my card and now, every time I buy something on Amazon, I have the option of paying for it directly from my CapOne rewards.

Regarding getting higher limit cards, even though I ran a pretty fair amount of money through my bank account each month (and had for years), Bank of America refused me a card; I immediately moved all of my bank accounts over to TDBank who offered me a card with a $5,000 limit right out of the gate; then 18 months later, even though I don't think I'd ever charged more than $2,500 in any one month, they bumped my limit to $8,500 without me asking. Similar story with CapOne, even though I didn't have any sort of a banking relationship with them, they started me out with a $3,000 limit, and then 18 months later they bumped it to $5,000. Long story short, you don't need to carry balances to get them to bump your limits.

 

When I got my card, BOA asked me if I wanted automatic limit raises, or if I wanted to call them if I wanted the limit raised, I declined the automatic limit raises. They were willing to go to a 50k limit after I "persuaded" them to give me a card, no way did I want it that high, I actually wanted only about 1-2k but the card I got has a minimum 5k limit, so that's what I ended up with and have never come close to maxing it out.

 

Yeah, I don't like automatic raises in limits either.

In fact many of the "benefits" CCC offer are designed to prey on people that can't pay off their balances so in general I see them as scammish. I've been tempted by "cash back" but it still hits me as a slimy come on to attract weak customers. Of course strong people work the system and if they do it well and consistently they are ahead of the game.

It all adds up to penalizing people that pay cash and avoid debt. And somehow people are more interested in using the corrupted system than in fixing it so everyone saves money and lives better.

 

In younger years, to build up a credit history a Sears credit card was the easiest to get. Had that card up until they closed their stores. Always came in handy for tools and such.
Now I have a BP gas visa which gives me .15 cents off a gallon and with the price of gas when I left, I'll take it. Have several other gas cards but never carry a balance