h2g2 The Hitchhiker's Guide to the Galaxy: Earth Edition

That's not as bad as it sounds.

Several years ago the former Mrs Gosho suggested I get a credit card because it would be another tool in building a credit rating besides, eg, paying your utility bills on time. I wasn't keen on the idea but she said it'd help because a good rating is useful in all kinds of ways that I couldn't even begin to think of, not just for getting a lower rate on loans, for instance, and even getting a job. That's just not right as far as I'm concerned, but it's the way things are

So I did, and I used it sparingly, always staying within my limit, but only paying around 90-95% of the balance each month because I'd heard somewhere that credit card companies don't like people who pay all their balance every month (because they don't make as much interest off people who do that), and that it's not unknown for them to simply close your account. That was some time ago; I don't know if they still do that, or are allowed to. I wouldn't be surprised if they can.

Any road up. Over the years I've used it less and less, partly because I can't see the point of buying something with a card, that's going to charge me interest, for something I could buy with cash, which won't, but mostly because we now know how much data about us corporations are collecting, almost minute-by minute. The credit card company will have been doing that and profiling me through my purchases, and although I'm sure that by now they already have a pretty good idea of what kind of person I might be based on their algorithms and judgements, but I want to minimise that as much as I can from now on.

(Did you notice there how I avoided using that ghastly buzzphrase 'going forward'? )

There are going to be times, such as online payments, where I don't have any choice but to use some form of plastic payment, and I'd rather it be a credit card rather than a debit card because if someone gets your CC details they're spending money that you, in all likelihood, won't have to pay (that's been the case with me twice now), but if they get the details of your debit card there's always the possibility they could empty your bank account. A remote possibility, given the way that unusual activity is flagged these days, but a possibility nonetheless.

So this month, for the first time, I wrote a cheque for the full amount of the (very, very small) balance, and will continue to do so from now on.

I noticed the other day that my APR on my AmEx has snuck up above 15%. Before the financial collapse of 2007-2008, I was rather happy that I didn't have a card with an APR over 10%. Funny how that works. I've been damn good at paying off my balances, if not always monthly never more than two months. I haven't carried a balance in years really. But it's not MY behaviour that has caused my rates to rise, but the behavior of the CC companies themselves >bastidges!<. They behave irresponsibly and face restrictions to how they can skin us so they find the ways they are still allowed to skin us. And they buy more politicians to remove the restrictions anyway.

Anyways, I'm not that concerned since, as I said, I don't carry a balance anymore. I did check my credit rating last year (need to do it again soon) and I believe it was well into the 800s, which I believe is rather good. I'm not overly concerned. Unless something drastically horrible happens to my Subaru I'm not planning on any major purchases any time soon. My 17 year old Subaru only has 104,000 miles on it. It should transport me well for another decade or two.

By the way, I now know the Filther doesn't let you speak of illegitimate children.

800s is *very* good.

The top credit score possible is 850, so well done!

I don't keep a balance on my Amex and use the card to pay most of my expenses. Then I just pay the total when the statement arrives. My score is also in the 800s. I do have a balance on my big box home improvement store card because I purchased some new appliances and they gave me 12 months to pay it back interest free. It's a good deal.

The condition of my credit card is that I need to spend at least £100 on it each year (so they get a decent cut from the shops I use it in) or they will charge me a fee - that works well for me as I use it enough, I can clear my balance each month, and the credit card company is happy too.

Credit cards are useful for online transactions etc in case of problems as you say - there's an extra layer between the card and the cash which is reassuring, so I use Credit Cards rather than Debit Cards then too

A century over the course of 12 months seems like a fair exchange for waiving the fee. You could use the card for nothing more than a monthly Netflix bill with the card and make that limit

I tend to use my credit card for any/every electronic purchase; but all my houshold stuff is direct debit, or standing order anyhow; only other thing I use a lot is payhpal, and as that's just straight on/off the credit card, it amounts the same thing; think I've had tha tcard about twenty years no, and never paid a penny in interest and they've never hinted at closing it down, or anything; just randomly increase my limit on it, though its not a huge limit compiared to some peoples, its way more than I can imagine I'd ever want; more than enough for a massive spree in a department store, say, pucahsing new stuff for a house, or whatever... My current account is the main problem these days... its full to overlfowing, which, probably accidentially happens to tie in exactly with the point in time when I quit smoking - doesn't even seem any point moving it to my ISA, though, as interest rates are just so mind numbingly low everywehre... - Actually its more like the combination of not drinking alcohol, and not smoking that's make my balance shoot too high... - I keep trying to spend rediculus amounts of other things, like bonkers bath bombs and other stuff, and new beds, and curtains, an dcuddly toys, and stuff, bu, clearly I've not quite mastered the art of retail therapy yet... you'd think there was a course in it, somewhere for the unitiated.... = I think I'm way too tight with money; we were hutning for an old document I thought I had, the other day, and I came across an old building society book; that I'd forgoten about... with £13K in it... yeh... err... oops - If only I still drunk and smoked, I could go on one heck of a spree

envy?! - I'm worried I've got some kinda alsimers!; its not normally the sort of thing I'd forget! I blame... the drugs....

I'm sure part of the reason I'm as fiscally responsible as I am is the era in which I grew up. When I first became aware of basic economics was in the mid 70s to very early 80s when banks still gave decent return rates on accounts. Bank accounts returned as much as 10% interest APR. WHOT-THE-WHAT!?

Now 1% interest is surprising.

My last major credit card purchase was 2/3rds of the full price of my second motorcycle. I had just enough money in my bank accounts to pay for it outright, but wanted to leave enough in the bank for emergencies. I paid the remainder off in 3 months. My last motorcycle purchase was even sweeter. They gave me a great offer (and a very respectable trade in on that previous bike) expecting to get some of it back on financing. When we were done negotiating, I wrote a check for the full amount. The dealership made $75 on the sale.

I still bought the bike on installments. The difference was I made my payments before I made the purchase; I set aside money into my bank accounts for years before.

I grew up in austere times. I would get scolded for leaving a room and not turning the lights off. My mother would stretch shampoo by watering down the bottle. My yearly earnings now just qualify me as middle class, but I'm debt free. I've been putting 15% of my earnings into a 401K retirement account (hoping the big banks don't destroy it again) for as long as I've had that option.

Most people I know that are near my age are not so fiscally responsible. Maybe I was just paying more attention. One of my friends is considering selling his house and everything else he owns to buy an RV and sell silk screened T-shirts and decals and maybe sell a few bicycles as his "retirement". I think he's planning on dying young (he's in his mid forties).

Sometimes I think I'm the most responsible person I know.


Sometimes I wonder if that's a good thing. What have I missed?

I haven't been quite so fiscally responsible, at least in terms of preparing for retirement. But apart from a short while when I had an overdraft on my business, I've always lived within my means and not been in debt.

What have you missed? Who knows? I have friends in the UK who are taking early retirement, but they've been in relatively well-paying jobs with good retirement plans for many years. I, on the other hand, have gone through several careers, for want of a better word (and have just started another one at the age of 58 ), and spent almost half my working life self-employed. In doing so I saw and did and experienced things I couldn't have dreamed of when I left school, but that laissez-fair attitude to putting money away for retirement means I'm never actually likely to.

But like you, I was brought up by frugal parents, in this case both of whom lived through the Depression, then World War 2 with its rationing and shortages, and the austerity years of the late 40s and early 50s, so not wasting things and being careful with money was drilled into me, even though they were fairly comfortable by the 70s and the 80s. Friends wonder how I manage to live where I do, on my own, bearing in mind the rent I pay. It's because I know how to live well on what I earn.

ditto.... -never lived outside my means, and it seems I'm virtually alone in this, in the UK thesedays; never had a morgage, never bought anything on HP, never used my overdraft, and never paid a penny in interest on my credit card, or any other loan... - given recent events, mind, I doubt I need to be overly worried about a retirement fund, my genetics seem hell-bent on ensuring I don't have a seirously long life though, oddly, I can't rul it out entirely.... if family members don't die by the time they're 50 from our genetics, they just seem to mount up ailments and diseases, and opperations, and chronic disease, and alcoholism, and, somhow then picklke themselves into longevity Somehow seems I'm spending less at teh moment, than I thought, given some of my .... more frivelous purchases but even despite that, my current account seems to go up by two or three hundred per month once W and I have our finances together, and are living together, I think we'll be shocked, at how randomly well off we appear to be (largely I guess due to teh fact I bought this house, just at teh time in the market before the prices went mental; if I were renting a place like this, here, it'd probably be soemthing like £1200 PM; no way I could afford that, full stop!) W's got some very weird for life pension thing, which he took early, which is very decent, and was, of the time before pensions got rubbishj, with the added benifit, for some reason, that it passes, on his death, to surviving spouse, which I guess may be me, if I continue dodging death in this random way just lucky at the moment I've got my magic plastic card for being a cancer patient; I'd hate to see the bill for my months prescriptions at the moment! heck; in the US; the chemo drugs would just about have bankrupted me, at about a thousand pounds per throw let alone all the tablets and stuff in addition to teh 'real' drugs - I went into a shopping frenzy last night, though, and treatmeted myself; spent £1.90 on some hooks to go up in the bedroom, for hanging things from yeh... that is about my leel of frevilous spending ATM

No interest on the credit card... you intrigue me. No interest because the balance was paid in full at the end of the month I understand, but there's interest on the money spent (ie, borrowed from the CC company) during the month.

really? doesn' tseem to work that wa on my credit card; interest is only charged, once the amount spent on teh card, has been on it, more than a month; so paying off, before/by end of month, means I got no interest charges hmmm.... hang on, I've got a recent statement though, just teh other day

Hmm, maybe I've been misunderestimating the way credit cards work all these years If that's the case I should have no interest charges on next month's bill

If you pay the balance promptly when you get the bill, the interest doesn't apply. I think there's usually a week or so grace period before the interest is charged. Check your latest bill. It will indicate the date when the grace period ends.

Duly noted