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10 Responses to "Credit Card Debt"

1. | Reply Mike
   Posted 23 Mar 2008 at 7:20pm #
   

   Don't buy what you can't afford, and pay your bills on time. It's so easy.

   Then again, I haven't yet bought a house or a car, so I'm sure eventually I'll need some help to buy something big...but it blows my mind that people will buy stupid stuff on credit, as if they have extra money to burn.

2. | Reply Alan
   Posted 23 Mar 2008 at 11:05pm #
   

   As of today, yes but I haven't sent in my expense reports for work yet. 😀

   $140k? Wow, that is unbelievable.

3. | Reply Jeff
   Posted 24 Mar 2008 at 2:32am #
   

   I voted "yes" - but it's down to about $500, to be paid off in the next month or two, and i generally charge up and pay off about that much a month...

   So that's pretty close to "no" - or would be, if the question were "Do you pay interest on your credit card?"

   School loans, and vehicle loans, now that's a different story.

4. | Reply Bryan
   Posted 24 Mar 2008 at 5:07am #
   

   I'm with you, Jeff. My credit card balance is at about $350 and will be paid off soon. I use it to get stuff quickly without having to corral funds together. Then I pay it off. I've done it a few times, but I'm still relatively new to the whole credit thing. Quite frankly it frightens me, so I avoid it when I can.

5. | Reply Erik J. Barzeski
   Posted 24 Mar 2008 at 8:49am #
   

   FWIW, I don't consider using a credit card and paying it off monthly to be "credit card debt." Carey and I earn rewards for using our credit card, so we buy all kinds of stuff each month on the CC… and then pay it off when the bill comes.

   So if that wasn't obvious by the question, that's what I'm asking: are you carrying a balance between months?

6. | Reply The Plaid Cow
   Posted 24 Mar 2008 at 9:23am #
   

   Yes, but at a rate that is over two percentage points lower than my mortgage.

7. | Reply DJ
   Posted 24 Mar 2008 at 12:49pm #
   

   I have friends who've gone through med school and racked up $200,000 plus in debt. Some of that is tuition, of course. But once you get past $100,000 in overall debt, you do seem to pick up steam. I knew one guy who had more than 100K in credit card debt alone – paid for everything on his card and paid the monthly minimums only. He wasn't just buying food and books, but electronics, concert and plane tix, etc. Took him several years as a well-paid doc to pay it down and improve his credit enough to buy a house.

   Personally, we use our cards like Erik - get the rewards, but pay the balance every month. I remember feeling bad about having a balance of $600 on my credit card when I graduated from college. Never again!

8. | Reply Tim Buchheim
   Posted 24 Mar 2008 at 3:25pm #
   

   I did carry balances fairly often in the first two years or so that I was out of college, mostly due to living in an area where rents were ridiculous (and I had a great bargain, only $1350/month, in an apartment which could have easily gone for $1800.). I do the "put everything on the card to get reward points" thing but pay off my balance every month. Those people carrying those ridiculous balances are paying for those Borders and Target and Circuit City gift cards that I get from my credit card company once every few months. 🙂

9. | Reply Erik J. Barzeski
   Posted 24 Mar 2008 at 4:13pm #
   

   [quote comment="46845"]Those people carrying those ridiculous balances are paying for those Borders and Target and Circuit City gift cards that I get from my credit card company once every few months. :-)[/quote]

   Interesting - we just get "points" which equates to dollars. Something like around 1-4% (4% is on gas, most everything else is 1 or 2%). Currently we have $120 already this year. They just apply it to our December balance every year.

10. | Reply Freddy
    Posted 25 Mar 2008 at 2:31am #
    

    A couple things to remember here:

    (a) Some people use credit cards as money for startups or personal businesses. This may not be the best idea in the world, but lots of small businesses have done it. Not hard to reach these astronomical debts this way.

    (b) You can charge medical care. As crappy as that sounds, it is also more common than you might think. Also an easy way to have very high credit debt.

    (c) Once you jack up huge amounts of credit debt, the additional fees added each month are ENORMOUS. I'm sure you all already know what a ripoff credit cards can be (high interest, fees, etc). Now imagine the same thing once you have $100k as a balance. Yowza. I suspect that if someone has, say, 60k in credit card debt that it wouldn't be very hard to reach 100k without purchasing another thing with the cards (just interest and fees alone).