When purchasing something, do you save up or put it on credit?
 

I find myself to be the kind of person that saves up until I can buy something "straight up," instead of opting to buy it over time (credit card, or store payments).

Granted, this is hard to do for more expensive things, but I am saving up for a car and I am going to wait longer and buy a used one (paid in full), as opposed to making payments for 3-5 years.

What do you find yourself doing? Saving up and buying all at once, or putting on credit or paying the store in timely payments?

I'm the same way, I save until I get all the money and then buy. There's nothing I hate worse than knowing that I owe people money.

it all depends how expensive something is. if i know i can make the money by the time the cc bill is due, then i charge it.

I make myself wait at least a week and decide if I really want it. Then, if I still want it, I'll go buy if I have the cash or wait till I have it saved up.

Cash only. At some point, you pay more than the guy who paid cash if you used credit.

I think credit cards are beneficial to have for things like unforseen emergencies or that "perfect" gift for someone special. But no more use than three or four times a year.

I think everyone should note one important thing:

If you never use credit, you will never build it up, and you won't have it if you really NEED it.

My suggestion (which I follow better than I used to), is to have one or two cards and occasionally use them for small and big purchases (key word, occassionally) and then PAY THEM OFF IMMEDIATELY.

This way you will begin building a credit history of being a reliable person and when you WANT that CAR or HOUSE, you will be able to get a loan, and at the lowest interest rate available. (Higher risk individuals pay higher interest rates on loans.)

Cripes... you guys have too much patients...... I WANT EVERYTHING NOW :) hehehe....

Save up! It's the only way to go. Not only do you not end up in debt, but you also respect it more once you finally have it. Plus you never know--it might be on sale or cheaper by the time you get it.

I save up for it, put it on credit, turn around a pay it off right away. Builds credit.

My wife and I have immaculate credit (enough so that the credit manager came and shook our hands when we bought our first car). We generally try not to spend on credit, but when it's unavoidable, we don't blanch at the idea.

If it's a frivolous purchase (and I <i>love</i> those), it better be cash, or be on the credit card only until the statement comes.

Right now I only use cash (I'm a 19 year old college freshman). I think having a credit card would be too dangerous for me. I recognize my spending habits. If I have money on me, and I'm in a store I like, like Eastern Mountain Sports or Best Buy, I will generally spend it. Because of this, I rarely carry more than $5 with me, and I only have an ATM card, not a debit card. If I had a credit card, I think I'd just be too tempted to buy things that I couldn't afford, then get into trouble when I couldn't pay off the bills.

Good point Lebell, I hadn't thought of that. I guess I'll just have to work on my self control first;).

Depends on what I'm buying, if its expensive I'll usually put it on credit cause I dont like to carry a lot of cash. Though I rarely buy something on credit if I dont have the cash in my bank account.

I do both. I use credit if I know I will pay it off when the bill comes. But if it something expensive, I have to know that I can pay for it if I charge it.

I always use the credit card for extended warrenties and cashback bonuses. But I pay them off every month. I have done this since college. I did buy one car on credit because my old one was going to need major work and I could not see putting the money into it. I paid it off a year early and my next car was with cash.

Considering my credit sucks thanks to the assistance of my ex-wife. I use cash b/c I do not have any credit cards. Now that the ex is gone I have been cleaning my credit up

Put everything on credit, but only what you have in cash so that you can pay off the whole bill when you get your statement.

Aside from the benefits mentioned above about credit rating you can also expect to benefit in the following manner:
<ol>
<br>You earn reward miles or loyalty points on all purchases. Trust me it adds up.
<br>You get a record of all your purchases that you can match to your receipts. You can't match your receipts to a one line debit to your bank account.
<br>If you pay it of right away you are not charged any interest.
<br>If you have a good credit card you get insurance on all your purchases.
<br>And here is the big one...<b>the money stays in your bank account for one extra month and you earn the interest instead of the merchant</b>.

Unless its a house or a car -- I pay for it outright. I do use credit cards but pay the balance in full every month. Been down that other road before and sure as hell on going back for a return visit...

Credit is the Devil.


I pay for everything in cash... I like carring around thousands of dollars in cash... not all the time so don't come find me.

Save, the only execptions I can think of is a car and a house sometime in the future.

Now I save up. I have some stupid credit card bills cause I was dumb a few years back. It's my own damn fault.

Credit berry berry bad. BAD! No use credit, is bad.

Save, pay cash, be happy.

Credit cards evil tool of satan. Cause much misery, sadness, brokeness.

Don't mean to hijack the thread, but I think this is on topic enough. Currently I have about $1600 or so in credit card debt. I have $1200 in a money markey account that is maybe doing 1-2% if that. I was thinking about taking the money in market account and paying down my credit cards. Good idea? Bad idea?

Straight saver! I always give myself some mad money though

kgb, unless your card debt is at 0%, that is a good idea. Very good idea.

I save up for everything except classes and books, those go on the credit card. For the most part, if I can't pay in cash, I probably don't need it.

I usually pay for everything with my credit card, but I only charge what I can pay off in full each month to help build my credit.

If I really need something and have not got the money I will get it on credit.If I have the money in my pocket and was thinking about something regardless if I was going to leave myself short Iwould buy it

I always save up. Otherwise you'll get stuck in so much credit card debt, and that would be very not good. :)

Thank God that smoeone actually has the balls to admit it's their own fault and not the credit companies.

I don't care how great a Platinum AmEx card makes people feel about themselves, they would change their opinion if they ever had a chance to carry that $20,000 around in a briefcase full of small bills. Even if it isn't your money, it's one of the greatest feelings in the world, as far as money matters go.


Speaking of credit, I want to know who the hell fucked up my rating so I can't even get a fucking student card. I haven't ever been delinquent on a payment for anything.

depends on the item, sometimes i save up, but if I really really want the item or need it then I may charge it.

I usually err on the side of caution though. hence no home theatre system :)

I've always been a cash man myself. If I couldn't afford it, I didn't want it. Never even had a credit card.

This came back to bite me when I decided to buy a house. (which I did recently) I had to scramble to establish credit, save a HUGE downpayment and hope for the best.
Now I'm mister credit card. Barely think twice about big ticket items. I think having an income well into the six figures helps me feel more relaxed about buying things too.

I've charged a few things lately, only because my credit card has a killer intro rate, and I should have no problem paying it off before the rate increases. I put a new camera (Canon EOS Elan 7E) and new speakers (Definitive BP-10) on it.

I'm right there with you. I paid for everything cash up to this point in my life, while using the credit card for occasional credit-building items. And now, my wife and I are 21 and able to afford a brand new house, which we move into next month.

I always put it on credit. I'm 21 and I've had a credit card since I was 17 and I've never not paid off my balance every month. I have one of those rebate cards and they add up nicely!

When I get the chance I pay cash, I don't try to put anything on credit, I only use my CC if I need to do something online, if not I use cash (or debit card).

Cash or Debit only.

I was Mastercard's bitch for 20 years - never again.

I buy everything on credit... and miraculously manage to pay it all over at the end of the month :). I spend within my means, I'll never carry a balance.

Alpha phi and I save up....we don't own credit cards....
I've seen many family and friends go into debt because of them....
The only way I would get a credit card was if we were going to travel overseas...

If you have the discipline to pay off the credit cards every month you can get a lot of interesting bonuses. I can gift certificates to a book store almost everymonth. When I was renting an apartment I charged it and had almost $4k towards my next car.

Good idea. The credit card debt is probably at least 6% so you are losing money if you are only getting 1-2% in the money market.

Take the money that you would normally allocate to the credit card each month and push it right back into the investment. Once that 6-8% fee is gone each month, you'll have that money also to plow into an investment.

Also, you'll get the benefit of paying off credit card debt and that will look good on your credit rating.

normally I'd never advocate going into debt, but when buying a car, I don't think it'd be a bad idea to go ahead and take out a loan on it.

It'd be a more gradual drainto your bank account, and as long as your income is decent you should be able to maintain your balance. Paying off a car looks pretty damn good on a credit report... so however you do it, just be sure you can afford it beforehand... i know several young people who are deep in debt cause they stretched themselves beyond their means early in the game.

i have to save for whatever i want; but i need a job first. :P

I do the same because skogafoss wants us to get frequent flyer miles. Worked out well because we did our whole Honeymoon flights on frequent flyer miles traipsing across Europe.

but I do try to save before spending... and i try to find a sale to boot.

Being in debt up to the proverbial eyeballs causes me to 'stash cash' for something I know is coming up. Lately, due to lack of available cash, I have resorted to almost living on plastic. We are currently about $33,000 in debt and it ain't getting smaller.....

I WANT to save.

But I'm weak.

I buy on credit.

My grandmother pointed out to me many years ago that "You come into the world with nothing, so if you die in debt, you're ahead of the game". :D

It's a mission.

I recently got a credit card. I put most stuff I buy on it and pay it back as soon as I get the statement, to build my credit history.

I'd be pretty scared of using it any other way.

Save up usually. We bought a fridge and othre appliances recently on credit but it was interest free for 5 years and our fridge at the time was leaking on our floor and sucking up the electricity. Otherwise? Save up. We have no credit cards now.

I pay cash for everything.. I'm actually one of those that didn't ever get credit to get a rating to get a credit card.. dizzy times :confused:

I use a lay-by/lay-away system to get what I need if I don't have the cash on me straight up, I have been working on getting a credit rating so I can at least get a credit card for emergency use or to at least get a few of the advantages they can offer.. but I would work on the concept that it would have to be paid off when the statement came in.

Use credit cards to build up points for other stuff. Pay off at end of month. I do have a car loan that's just about done. Due to falling interest rates these past few years, I called and got the interest rate lowered a few times. The laptop I'm using to write this I purchased from Compusa on one of their promotional "3 years, no interest" plans. I'll probably have it paid off within a year. I get credit card offers all the time so I must have pretty good credit.

I almost always try to save up.. but sometimes it doesn't work and i have to put items on credit.

I have no credit anymore... which is a good thing.

I was never taught personal finance, and my parents were very bad role models... By the time I was 28, I was $60,000 in debt.

I realized that I needed to do something, but I was powerless to stop it. (or so I thought)

I started going to a credit counsellor, and ended up working out a repayment plan. I cut up all my credit cards that day.

I still have about $20,000 left to pay off, but it's worth it for the feeling of relief. It's taken a lot of work for me to get used to using cash. I've never saved for anything before (hard as it may be to believe).

I'm pretty paranoid about money now, and don't really like to spend it at all... which isn't really healthy either. I am working towards re-establishing my credit so that I can by a house, and a CC would be handy for some deals online.

I whack everything on my credit card then pay it off every month. I loath paying interest, but I love flying for next to nothing.

Unfortunately, I've been a crediholic for most of my life. I'm slowly turning that around but it's taking time to overcome bad habits. I'm teaching my kids, cash only, that way you KNOW you can afford it.

I’m 21 and I have had a credit card for about a year now. I attend classes full time and work part time about 22 hrs a week. I signed up for the card through a promotion Citibank was doing at my school and have had it pretty much maxed out since. It only has a 500 dollar limit but that’s hard to pay off when you barely bring home a hundred a week and keep using the damn thing :o. I’ve been reading the TFP finance boards a lot and I’m trying to pay it off. Each week I put about half my pay from work towards the card. I’ll keep the card and probably use it to purchase gas. 350 dollars to go and it’s back to cash for me :thumbsup:

As long as you can pay it back on time, use the credit card. 1. You've paid for the priviledge. 2. You can get points, (if you have one of those cards.) 3. Builds up positive credit. 4. Your ATM card probably has a transaction fee.

But if you're asking about hire purchase or something like that, wait for one of those interest-free deals. You're using it much earlier without having to pay anything extra, (of course, you could argue that prices would have dropped by the time you had the cash...)

I guess having a card and paying it off monthly makes sense, if you're looking to gain points. But you'd better have discipline. I don't.

I have never had a straight credit card in my life. I always saved up for what I wanted and put money away. The one time I financed a car, I financed it at the Bank of Dad. As for building credit, I wasn't even on the credit bureaus' radar, as I found out when I bought my first house. The mortgage company was puzzled by that. But I had the down, assets, a good job, and no debt, so I got the loan.

After you get your first home loan, you don't have to worry about credit cards to build credit. The fact that you make monthly home loan payments is good enough.

So: a big credit history isn't necessary to buy a house, if you've got the down and good prospects. And once you buy a house and make payments, your credit is good. So credit cards aren't necessary to build good credit for the one loan you really _need_ to have, so long as you stay out of debt and save your cash.

Stay out of the credit trap. Don't even go there.

I save up...mainly because 1) I don't have a credit card, and 2) credit cards charge interest, which means I actually pay more (which I don't want to do)

I pay for everything with my Sony card and get the points for free stuff. I pay it off every month.

If I'm buying something expensive, like a big screen TV, I use their 18 month or 24 month financing and pay every month whatever the fraction of the cost is...but always pay them off on time. If they will let me use their money for a year I do it gladly.

only buy if you have the cash...living on a cash basis is nice :-)

of course, the caveat is that you have to be able to afford to live like this

You're one of those people the big credit card companies just adore! Not me - I always pay off my card within the month, except for air tickets or big purchases. Then I over pay and pay it off fast...I hate paying interest! It's usary, IMHO. A dangerous habit for anyone to get hooked in to...

I'm pretty sure that he just said the same thing you did. It's worded kinda funny, but you can cancel out the never and not and it's easier that way.

One of the best practices you can engage in with respect to getting credit worthiness established is to have a single card and purchase on the card only what you know you can pay off at the end of the month when the bill becomes due. A regular pattern of paying on time and in full will put your credit score in very good standing.

I typically only use a credit card, now anyway, for only large purchases such as vacation travel, or home repairs/upgrades, etc. And at that it's after planning the budget accordingly so that I don't suffer from budget shock. Impulse purchasing on the credit card is a major no-no. Limit shocks to your budget by avoiding temptation to use the magic card.

On the subject of budgets if you don't have one then shame on you. It's a good practice to build a budget even as a college student with limited income. ;)

Using a credit card and getting the rebates/points/miles/extended warranties, etc. is a great deal . . . as long as you pay it off each month! I buy just about everything on cc, even utility bills that do not charge extra for the service, then pay it off each and every month. It is a great feeling for me to know the credit is available in an emergency.

For those who use debit cards, though, a word of caution . . . if you use it and the vendor makes an error and double charges the card, it may take a few days to get the money refunded to your account (a very dear friend of mine experienced this recently). If the error had occured with a credit card, he could have simply disputed the charge and the credit card company could have resolved it with the vendor.

Free financing is great, too (the 18 months or whatever "interest free") but be absolutely certain to budget for the purchase so it can be paid off entirely at the end of the free interest period! Those lenders through the furniture places probably make a ton sticking it to people who forget or plan poorly . . . read the fine print for the rate that will apply (and the interest is normally charged back to the day of the purchase!)

With cash, I can walk around with the same $60 in my wallet for weeks :p

I do both, cars are bought with a loan from my 401k. In effect, I borrow money from myself and pay myself interest. 18 years left on the mortgage. Most other things are paid for using cash, with the exception of home improvement projects. These inevitably go over budget. I've take several 12 months / 0% interest deals from Home Depot. I'd rather deal with payments, than do a half assed job.

If I can't pay for it with cash, I can't afford it. That's my mantra, and it has worked great for me. Now that does exclude homes and cars, but covers everything else.

I never purchase somthing that I cannot safely purchase using my debit card at the same time. I simply use the credit card to build up credit.

It depends on the purchase. The new car we are thinking of purchasing will have to be financed somehow..whether a loan or perhaps just leasing the car. Smaller things like video cameras, etc. I'll make sure I have the money first. Then I'll put it on credit card to defer the actual payment by a month and keep the money in an account making some sort of interest. I also get "Visa Points" or Airmiles depending on the credit card.

I always pay my credit card bill. If we don't quite have enough to pay off a credit card we will draw down on our line of credit paying the bank about prime to re-pay instead of the high interest charges on the credit card.

As Destrox says..paying with a credit card when you already have the money (or will have the money by the time the bill is due) helps build up some great credit.

Credit cards don't necessarily help you build your credit rating. If you have 30 CC's and no balance, it negatively affects your credit rating. You would be better off have a car loan or mortgage, those are the things that will build your credit, not using credit cards. The more you use credit cards, the higher credit risk you are, simple as that.

I do both. I save up AND put it on credit. The rewards points thing really got me hooked. I even pay my monthly bills with credit just to get those points! I just charge everything on my card then pay off the balance each month.

I am one broke-ass college student. I don't even have a summer job yet, and i have a little over $200 to my name....

I still applied for my first credit card the other day.

Very dangerous.

this thread is reminding me to check my bank account online... as I don't keep records in my checkbook. And usually know a good estimate of how much money is in the bank at a certain time...

I have one main credit card + a victoria's secret card. I'm thinking of getting another credit card to use as my main one just to see if the APR is better.

Anyway, I tend to put stuff on credit a lot, and use my debit card way too much instead of normal cash... So yes, I put it in credit rather than save up but I try to be aware of how much I'm spending so I don't overspend the amount of money I actually DO have to pay those back with..

Right now, I'm not too concerned because I'll be getting an easy $10/hr. on some tedious crap job (archiving cds) for an ad agency for about a week and then I'll have a part-time job in the summer... Plus my extra student loans. I'm all set. :P

i have only 1 credit card and i use it to pay for everything that i can. however, i pay off every statement completely and i only buy things where i know i'll have the ability to pay it off when the bill comes. it's a student citicard credit card because i got rejected from the "standard" citicard, however, i don't know what the difference is.

right now the card gives me reward dollars. however, after having the card for the past 10 months, i only have $70 in rewards. i'm looking for a card with better rewards like airline miles or vacations or discounts. anyone know anything good?