Well i am 17 years old. Saving up for my first bike. Plan on getting one in the winter time. I dont have any credit as you all know. Do any credit card companies offer any sort of starter loans? or give me a card with a small limit by any chances???

Okay. Stop. Now is a good time to get off this particular money-myth merry-go-round. You don't need "credit", except to buy a house and that's many years away for you. Pay cash for your motorcycle. Save up the money and buy a nice used bike for a couple grand. Keep saving while you learn how to ride that thing. Next spring you'll be ready for your next bike, and you'll have...TA-DAA!!.... money to buy it. Repeat as necessary until you're riding whatever bike you want at age 21 or so. Your broke friends will make fun of you. But do not take financial advise from broke people - your results will not be any better than theirs if you use their ideas.

Do not start off your financial life with a set of ideas that benefits ONLY the credit card company. Making payments on cars and motorcycles is an Express Ticket to the lower rungs of the economic ladder. I'm not kidding - that's the single biggest stupid expenditure that poor people make. Don't do it. Just keep saving.

+1 for what Dorkfish said. This is the best way possible. I know you are 17 and it would be "cool" to have a bike and a lot of fun, but your best bet is to buy something cheap and then keep saving.

However, if you are going to ignore that great advice and take a loan out to get a bike, you definitely do not want to use a credit card. Work one out with your parents to see if they can help you or go to a bank. Credit card companies are the worst to be in debted to (besides the mafia).

i agree pay cash is the best.

however I did that with both cars which helped me to learn to save, however, I am 24 and I dont even have a credit history.

I say pay cash for the bike but try to get a credit card with a small limit which you can pay off each month. I should of did that earlier then started at 23. It was so hard to get a card for free (no way I was going to pay for a card) started out with 2 store cards and worked my way up through Sears to a Sears Mastercard and in about 2 months the company said I can move over to their regular card which a lower apr and decent limit.

It takes time to built a credit history and I am finding that out. For my bike I used my dad's credit card at %3 apr of the entire loan, so at least I am building his credit up more.

I dont have any other bills so using that method doesnt hurt me, but I wouldnt recommend doing it if you have other payments to make and stuff.

"Toys" should be bought in cash like Dorkfish recommends.

And if you must get a loan please use a bank loan, and dont use a credit card that has %25 apr, to much debt.....

Some just like to have things now and dont want to save up, because they think the money is coming all the time, so people do loans and finance and most do fine but some fall into hard ships. Every heard of a repo man :)

at a young age u will pay like 23% interest which will make it near impossible to pay ur bike off.... trust me i know lol

get a small credit card from your bank and keep it under 50% utilized. It is not bad to buy you bike on a card if you pay LARGE payments. if you get a promo payment of 99 bucks, pay 300-400 bucks a month to get your balance down quick. once your balance is under 50% of the credit limit, your beacon score will shoot up. A good thing to do is to save the money for the bike first, then get a suz card and put your bike on that, then pay it down quickly. this will give you security and a good credit score.

Do what is recommended above with the following exception: save up the money to buy the bike, then skip the silly step where you put it all on a card, then skip the equally silly step where you view your Beacon score as some sort of Merit Badge, then buy the bike with the money you have saved up.

What builds a high Beacon score is borrowing lots and lots of money using lots and lots of different types of loans. It's nothing more than an "I Love Being in Debt" score - certainly nothing to be proud of. Don't play their stupid game - the game that says having a high FICO or Beacon score means you're successful. Having money indicates you're successful - a high net worth, not a high debt score.

Dorkfish, I am pretty sure that the name of this thread is establishing credit. therefore, I stated how you can establish credt. If you do not want to establish credit, then buy cash, however if you would like to establish credit, then save your money, buy on a card or installment loan and then pay the balance down quickly with your saved money. It will cost you a little more, but that is because you do not earn good credit, you buy it. Again, the name of the thread is esablishing credit, not how do I spend the least.

Unless you are a millionare, you will need to finance something at some point and having a solid credit history is not a bad thing. You do definately pay for it though

Okay. Stop. Now is a good time to get off this particular money-myth merry-go-round. You don't need "credit", except to buy a house and that's many years away for you. Pay cash for your motorcycle. Save up the money and buy a nice used bike for a couple grand. Keep saving while you learn how to ride that thing. Next spring you'll be ready for your next bike, and you'll have...TA-DAA!!.... money to buy it. Repeat as necessary until you're riding whatever bike you want at age 21 or so. Your broke friends will make fun of you. But do not take financial advise from broke people - your results will not be any better than theirs if you use their ideas.

Do not start off your financial life with a set of ideas that benefits ONLY the credit card company. Making payments on cars and motorcycles is an Express Ticket to the lower rungs of the economic ladder. I'm not kidding - that's the single biggest stupid expenditure that poor people make. Don't do it. Just keep saving.
Absolutely right :thumbup

But if you absolutely MUST "build credit" just get a small credit card and just spend like 50 bucks a month on it and pay it off every month.
DO NOT buy a bike on a credit card, ESPECIALLY suzuki credit card. With the interest rate you would get you could easily be paying that thing off for 10-20 years. (With the minimum payment every month). You really want to still owe on your first bike when your coming up on 30 years old. I think not.

put it in your parents name and get a loan cosigned by your parents that way you start a credit establishment basically you need a cosigner when you turn 18 pretty much your first anything credit your gonna need a cosigner so then would be a good start...But You MUST make All your payments on time or you will have a hell of a time getting credit later on......

Absolutely right :thumbup

But if you absolutely MUST "build credit" just get a small credit card and just spend like 50 bucks a month on it and pay it off every month.
DO NOT buy a bike on a credit card, ESPECIALLY suzuki credit card. With the interest rate you would get you could easily be paying that thing off for 10-20 years. (With the minimum payment every month). You really want to still owe on your first bike when your coming up on 30 years old. I think not.


you should never make the minimum payment on any credit card. you will never pay it off. again, if you want to establish solid credit, make big purchases on a card, just pay them down quickly, as to avoid the interest.

making the minimum payment is what the bank wants you to do. if you buy on credit and make the minimum payment you are retarded. IF you want a good credit score, you have to BUY it by paying some interest. if you don't care about credit score then buy everything cash. having credit does have its advantages though.

also, you do not have to be buried in credit card debt to have a good score

you should never make the minimum payment on any credit card. you will never pay it off. again, if you want to establish solid credit, make big purchases on a card, just pay them down quickly, as to avoid the interest.

Yes that was the point of my post. It was informative as to why it's a bad idea to buy a bike on a credit card.. It's very easy to make a impulse buy when someone says you can have this sweet bike for ~$150 a month. Then being so young if he isn't making much money on a monthly basis he is not gonna either be able to or want to make more than the minimum. Thus getting himself into huge debt and big trouble. This is why i suggested pay cash and if he wants to build credit get a small credit card and just pay it off every month.


But thanks for making my point more clear. :cheers

Ride Safe.

There are plenty of people out there to tell this fella what you guys are telling him - how to "build credit"; rationalizing buying things you can't afford; etc. My self-appointed job on this forum is to tell youngsters how to handle money for personal success, wealth building, and peace of mind.

If I don't tell them, who will?

Everyone in this guy's life has told him to "build credit". He now says "fine, how do I do that?". Because it's my job to tell people how to win with money, I tell him "Don't. Don't build credit. Don't buy the lie that you need credit to get through life, or you'll be a gerbil in a wheel for the rest of your life".

Money handling conventional wisdom in this country now reflects what the banking industry wants you to think and do: You can't have a car without a payment; you can't have college without student loans; home equity loans are smart because they're tax deductible; you can't rent a car without a credit card; you'll be smart if you spend "our money" for that Gixxer instead of "your money". If I can convince a few youngsters on gixxer.com to handle money in a different way, a way that first benefits their family or themselves rather than a bank, I will put a tick in the "W" column.

I agree with you dorkfish. I wish someone like your self had taught me that lesson before I taught myself through experience.

werd. how many bikes on this forum do you guys think are financed? more than half? I financed mine on a suz. card, but i put a big down payment and pay 500-600 per month over my 99 minimum, so it will be paid off quickly.

hey, can you finance a house if you have no credit? If you can't, then that could be the only reason to build credit, but if you can, then i guess there really is no reason to build credit.

We're not talking about buying houses and we're not saying having credit is bad or useless. But it will come naturally. He is 17. He does not need to go into debt right now for the sake of "building credit".

And like I said, if you he wants to do something to get himself started... Get your cell phone in your own name. Pay your own car insurance on your own policy. When you get your first apartment make all your rent payments on time. Utility bill, cable bill etc. Then when your 21-22 you graduate college. Your sitting debt free or school loans at most and ready to start your life adult life.

Much easier to buy a house when your not trying to pay off a motorcycle or a car or credit card.
Debt to income ratio is huge. It's not just your 3 digit score.

I am 17 I put 2500 down and financed my bike with my parents via our bank at 7% I put like 500-700 down each month to pay it off asap I also put 2000 in a savings account to insure i have money if something happens and i lose my job or something just to be safe

No one under 18 can enter into a contract so I beleive this is a mute point until the boy is 18...

Purchasing a motorcycle on credit (as your first credit transaction) is not a wise choice... The best way to establish credit is to purchase a car on credit with a decent down payment and co-signed by one of your parents so the interest rate isn't ridiculous.

Until your on your own and know how to handle your bills and credit... I don't personally recommend a credit card for anyone. Just IMO. Hope this helps.

I am 17 I put 2500 down and financed my bike with my parents via our bank at 7% I put like 500-700 down each month to pay it off asap I also put 2000 in a savings account to insure i have money if something happens and i lose my job or something just to be safe

Most 17 year olds dont have that kind of money laying around for a down payment. Plus you co signed with your parents so you got a good rate at 7% through a seperate bank(not suzuki). In your situation I'de say you got things covered and props to you.

Generally speaking a guy turning 18 and choosing to finance his bike because he wants to build credit is a big :nono. There are much bigger better things to be focused or worried about at 18.

Credit history becomes a big deal if you ever need to finance something. Only having one CC with a $1000 limit for a few years, that is always paid off may net you good score but doesn't entitle you to a $30,000 car loan when you want one, let alone a house.

For credit building purposes, I suggest financing a few major purchases, even if you have the cash, for a minimum of 1 reporting period (one month) and pay it off. At 17 I wouldn't worry about it too much though.

If a good credit score can even save you 1% in interest when it's time to get a house, the small interest payments made on previous fianced purchases are a drop in the bucket compared to roughly $40K saved on 1% for a $300K mortgage

+1 to that ^^^^

When i was 18 I bought my first bike, a gix 750, for about 5 grand. I was working summers, and had saved about 2 grand when summer hit. I banked with the same bank as my father and mother had for years, so they knew our history. The bank let me have a loan at a great rate when my father co-signed for me. This is how most younger people get their first car and what not, if they don't have a huge history of finance already, which I didn't. I paid the loan off in about a year even though I financed for 2. Not only did that help start my credit off right, it made a believer out of my bank, and they pretty much approve me for anything ever since.

I however, do 100% agree with the saving method. Why finance a bike, if you think about it, you are paying money for nothing but your impatience. Wait 6 more months *what i am struggling to do myself at this point* for the money to bulk up. It feels so much better to have something thats yours, and totaly paid off, then wondering if you will be able to make your next payment.

Also, keep an eye out on insurance. It will be high, very high if you finance, as most banks want full coverage, and at your age, we are talkin sucky payments. As much sometimes if not more then your bike payment. Factor all the issues in before jumping!

What builds a high Beacon score is borrowing lots and lots of money using lots and lots of different types of loans. It's nothing more than an "I Love Being in Debt" score - certainly nothing to be proud of. Don't play their stupid game - the game that says having a high FICO or Beacon score means you're successful. Having money indicates you're successful - a high net worth, not a high debt score.


:lol:thumbup
I enjoy reading your comments and lots of great advice here.

Also, keep an eye out on insurance. It will be high, very high if you finance, as most banks want full coverage, and at your age, we are talkin sucky payments. As much sometimes if not more then your bike payment. Factor all the issues in before jumping!

oh HELL YEAH

Insurance will be CRAZY

the annual cost for full coverage on a sportbike for an 18yr old rider will be close to (if not) the total cost of the bike. Go to progressive.com to get a rough quote. I know progressive doesnt necessarily have the greatest motorcycle rates but its not a bad thing to be prepared for the worst case scenario

its insane

Good luck though

When i was 18 I bought my first bike, a gix 750, for about 5 grand. I was working summers, and had saved about 2 grand when summer hit. I banked with the same bank as my father and mother had for years, so they knew our history. The bank let me have a loan at a great rate when my father co-signed for me. This is how most younger people get their first car and what not, if they don't have a huge history of finance already, which I didn't. I paid the loan off in about a year even though I financed for 2. Not only did that help start my credit off right, it made a believer out of my bank, and they pretty much approve me for anything ever since.

I however, do 100% agree with the saving method. Why finance a bike, if you think about it, you are paying money for nothing but your impatience. Wait 6 more months *what i am struggling to do myself at this point* for the money to bulk up. It feels so much better to have something thats yours, and totaly paid off, then wondering if you will be able to make your next payment.

Also, keep an eye out on insurance. It will be high, very high if you finance, as most banks want full coverage, and at your age, we are talkin sucky payments. As much sometimes if not more then your bike payment. Factor all the issues in before jumping!

Had I gone with financing on my gixxer... Which I didnt. My minimum monthly payment would have been about half of what my insurance is.


19, with 5 speeding tickets and one at fault accident in cars, 1 speeding ticket on a motorcycle with no M endorsement or insurance(grabbed the jacket I thought my info was in, wrong jacket, learned to keep it in the trunk with that one... I of course corrected it.)


Trust me... I don't even like to think about how bad my insurance company is raping me.

Unfortunately in America these days you have to establish some credit early on so that it will benefit you later on in life. The score is becoming so important some jobs, insurance companies are beginning to look at them to judge a person's responsibility.

I used to pay for everything I owned in cash and all that did was hurt me when it came to buy a house. Even though i had 20% down and make good money I couldnt get a good interest rate mortgage because i had no credit history. Same will go if you want to purchase a car that you can't pay for in one lump sum.

If you want to avoid interest rates and build up credit in the process just get a credit card and then pay the bill in full each month to avoid the interest fees.

Step to having good credit and being able to buy expensive things later down the road without having to pay in full.

1. Cell phone in your name
2. 1 or 2 credit cards- no late payments and good history
3. Small auto loan
4. Personal loan- aka for motorcycle
5. Mortgage

Do these 4 steps and pay them off on time every month and you'll have an excellent (750+) beacon score and not have to worry down the road for major purchases and expenses.

But then again this is only my opinion. But after being in the car business for a couple years I see people everyday with fucked up credit or no credit history at all who bite the bullet one way or another.

you wouldnt want to put a bike on a credit card even if you could. you would end up paying back so much in interest, it wouldnt even be funny.

Unfortunately in America these days you have to establish some credit early on so that it will benefit you later on in life. The score is becoming so important some jobs, insurance companies are beginning to look at them to judge a person's responsibility.

I used to pay for everything I owned in cash and all that did was hurt me when it came to buy a house. Even though i had 20% down and make good money I couldnt get a good interest rate mortgage because i had no credit history. Same will go if you want to purchase a car that you can't pay for in one lump sum.

If you want to avoid interest rates and build up credit in the process just get a credit card and then pay the bill in full each month to avoid the interest fees.

Step to having good credit and being able to buy expensive things later down the road without having to pay in full.

1. Cell phone in your name
2. 1 or 2 credit cards- no late payments and good history
3. Small auto loan
4. Personal loan- aka for motorcycle
5. Mortgage

Do these 4 steps and pay them off on time every month and you'll have an excellent (750+) beacon score and not have to worry down the road for major purchases and expenses.

But then again this is only my opinion. But after being in the car business for a couple years I see people everyday with fucked up credit or no credit history at all who bite the bullet one way or another.


Totally agree with him^^^. Im 18 and i took a personal finance class as my first college class and damn does it help. You dont realize how much your credit score and what not affects everything you pay on. With a good credit score you will live a much happier life. I agree that its always good to pay with cash if you have it but establish some credit first. I started off with a best buy store card and bought a labtop. Payed it off in the 6months no interest deal. Got a credit card threw the bank. Pay it off EVERY MONTH! Went and bought a new matress with a store loan or w/e. have 2 months left with $60 and no interest. I have put close to 4 grand in 6 months on these cards and have no payed a dime in interest yet i have like a 700 credit score or something. Only problem is i dont have enough established credit to secure a good loan. I financed my bike for 4 grand with a personal loan my father helped by cosigning. If i had done a auto loan i would have to pay like 2 grand a year in full coverage. With the money i save i could buy my bike in 2.5 years! As long as you live in your means and make more than the minimum payment you'll be fine

Totally agree with him^^^. Im 18 and i took a personal finance class as my first college class and damn does it help.

You should get your money back for that class as it was taught by an idiot. Well, maybe not an idiot, but definitely someone with more theory than money.

You dont realize how much your credit score and what not affects everything you pay on. With a good credit score you will live a much happier life.


That's a myth. You don't need a good credit score. Having actual money is the key to prosperity - not credit scores.

I agree that its always good to pay with cash if you have it but establish some credit first.


You don't need to establish credit. Just pay with cash. And not "if you have it..." - if you don't have it, don't buy the item. We're not two-year-olds any more.

I started off with a best buy store card and bought a labtop. Payed it off in the 6months no interest deal. Got a credit card threw the bank. Pay it off EVERY MONTH! Went and bought a new matress with a store loan or w/e. have 2 months left with $60 and no interest. I have put close to 4 grand in 6 months on these cards and have no payed a dime in interest yet i have like a 700 credit score or something.

You're a financial meltdown waiting for a place to happen. No one sets out to end up deeply in debt. They all think they're "building credit" or some other academic tripe, but they're really just spending money they don't have or haven't earned yet. You're going to wake up 5 or 10 years from now, no better off financially than you are right now - if you keep playing this losing game. How can I tell you're losing? Because.....

Only problem is i dont have enough established credit to secure a good loan. I financed my bike for 4 grand with a personal loan my father helped by cosigning.

How's this all working for ya so far? You've been playin' their game and they still don't really love you, do they? The banks are absolutely desperate to loan money. They send credit cards to dead people and dogs. They have loaned billions of mortgage dollars to people who couldn't qualify. They hand college students credit cards even though they don't have jobs. Branch managers have "loan production" quotas they have to meet. All that and they still won't loan you money without a cosigner. You know why? They know you're not going to pay them. That's why they required a co-signer. Your well-intentioned Dad probably doesn't understand this, but he's on the hook for this loan. Every time you pay late - it dings his credit. Every time you don't pay - it dings his credit. When you quit paying because of a layoff, the repo goes on his credit and they sue him for the deficit balance. You need to re-fi this loan to get your Dad out from under it before things start going bad and he's faced with paying off your bike or showing a repo on his credit. You guys made a common, but very ill-advised move here and if you don't want it to damage your relationship - refi it or sell the bike.

Once again the youngsters have been taught how to live like Normal Americans. Unfortunately, Normal Americans are broke, living paycheck to paycheck, too much month left at the end of the money, no savings, car debt, couch debt, second mortgage, no retirement, no college savings, and still braggin' about Discover Points or CitiBank Visa Frequent Flier Miles.

Once again the youngsters have been taught how to live like Normal Americans. Unfortunately, Normal Americans are broke, living paycheck to paycheck, too much month left at the end of the money, no savings, car debt, couch debt, second mortgage, no retirement, no college savings, and still braggin' about Discover Points or CitiBank Visa Frequent Flier Miles.

As always I agree with you...

I know a few people that are BROKE - They have good jobs - make close to 100k and are 100% broke - Paycheck to paycheck - I am talking about not being able to go out to dinner cause they dont get paid till Friday - But they brag about how they flew to Miami for free last week... :lol

but the thing is im not broke. I have the 4 grand in the bank and more money in CDs and savings. Ive been working since I was 13 and have been saving ever since. I payed cash for the truck when i was 16 but i rather keep my money in the bank for something such as a layoff or blown tranny then use it all on the bike and take a hunk of change out of my rainy day fund. And whats wrong with buying something with no interest for 6 months? Your just paying the same amount but over a period of time. Didnt i say i pay it off at the end of the month? What does it matter if i use a credit card instead of the debit card? If i can save money when i do buy a house because i have established credit then more power to me. What about you DORKFISH? Did you pay for your house with cash? highly doubt it

but the thing is im not broke. I have the 4 grand in the bank and more money in CDs and savings. Ive been working since I was 13 and have been saving ever since. I payed cash for the truck when i was 16 but i rather keep my money in the bank for something such as a layoff or blown tranny then use it all on the bike and take a hunk of change out of my rainy day fund. And whats wrong with buying something with no interest for 6 months? Your just paying the same amount but over a period of time. Didnt i say i pay it off at the end of the month? What does it matter if i use a credit card instead of the debit card? If i can save money when i do buy a house because i have established credit then more power to me. What about you DORKFISH? Did you pay for your house with cash? highly doubt it

If you didn't have 4 grand in the bank and more money in Certificates of Depression and savings, but your bike was paid-for, would you ask your Dad to co-sign for a $4,000 loan against your bike and put it in CDs?

Take the 4 g's and pay off your bike. Today. Then take your old bike payment and put it in savings every month until you have 3-6 months worth of living expenses saved back up. Quit trying to "build credit". The only reason to have a high Beacon score is to enable you to go very deeply in debt. Mathematically, these "same as cash" deals are an absolute joke. From a personal finance standpoint, you're playing with snakes: 88% of these contracts do not get paid off in the term. Life happens to people and their pseudo-sophisticated plans. Then they revert to junk paper at 28-36% interest, back-dated to the date of purchase, with credit life and disability life insurance tacked-on, and huge pre-payment penalties. So there's a reason they push these things so hard. Not only are you over-paying for the mattress in the first place, they get to re-sell the financing contract and make yet more money. All because you thought it was wise to use "someone else's money" to keep your money in the bank and make roughly the price of two cups of Starbucks on it. Yeah, you're killin em.

You know how to work. Don't work for them. Work for you. Bring your money home. You don't need a FICO score to qualify for the best possible mortgage rates. That's what's known as A LIE. FICO lending is a recent development designed to allow chimps to get into the mortgage business. Plenty of high-quality lenders (the only kind you want to do business with) will still do "manual underwriting" wherein they actually look at the person - his bill paying history, his rent paying history, his work history, etc., in order to qualify him for the mortgage at the best available rates.

I know what you've been taught is "what everybody knows": build credit, responsible use of debt, Other People's Money, payments are a way of life, you have to have debt, and all the rest of the lies that bankers want you to believe and act on so they can continue to own everything and work in really nice buildings. A few years ago, the Forbes 400 - the 400 wealthiest people in America - were asked as part of an interview "what's the most important ingredient in becoming wealthy?". Seventy-five percent (75%) of them said "getting out of debt and staying out of debt". This is not some broke finance professor (or more likely a TA), or your Uncle Jimmy with all the theories. These are the wealthiest people in North America. And they agree with me.

And, yes I paid for my house with cash. I did it by doing exactly what I'm telling you to do: live well below your means; save up and pay for things; stay out of debt; invest ALL THE TIME NO MATTER WHAT; give money; live on a monthly written game plan for where the money is going to go before you earn it instead of wondering where it went after it's gone. And before you make the natural assumptions: no, I did not inherit a bunch of money; no, I did not make a zillion dollars a year - I built up all that money as a Captain in the Air Force and paid off my house while making about 40k/year.

As I've said before, my self-appointed job on this forum is to give Youngsters a chance to hear something different than what the larger culture tells them. Because the larger culture is BROKE. The vast majority of Americans live exactly as you have described in your posts. And NONE OF THEM HAVE ANY MONEY. Do you want to follow them, or the Forbes 400?

Its good to have both a good credit score and money in the bank. Apply for an amex blue card and when you get it, open the account, cut the card up and throw it in the trash. That is what I did about 6 years ago. Amex reports on my credit every month as "paid on time in full". My credit is in the high 700 range.

yes I paid for my house with cash. I did it by doing exactly what I'm telling you to do: live well below your means; save up and pay for things; stay out of debt; invest ALL THE TIME NO MATTER WHAT; give money; live on a monthly written game plan for where the money is going to go before you earn it instead of wondering where it went after it's gone. And before you make the natural assumptions: no, I did not inherit a bunch of money; no, I did not make a zillion dollars a year - I built up all that money as a Captain in the Air Force and paid off my house while making about 40k/year.

As I've said before, my self-appointed job on this forum is to give Youngsters a chance to hear something different than what the larger culture tells them. Because the larger culture is BROKE. The vast majority of Americans live exactly as you have described in your posts. And NONE OF THEM HAVE ANY MONEY. Do you want to follow them, or the Forbes 400?


Well of cource i dont want to be in debt. I much rather have no bike payment but that money is for college in the fall so its staying put. If you payed with cash though for your house, isnt that hurting you in taxes? I mean you do get to deduct any interest on a mortage every year so why pay it off early? My GFs grandmother makes like 90,000 a year and put a mortage back on her house just as a tax shelter. http://www.alllaw.com/articles/tax/article3.asp Then again you say you paid off your house making 40 grand. So i guessing you rented until you were able to buy a house for cheap? Im not trying to argue with you just trying to understand this more. You bring up alot of good points and granted i havent payed a dime in interest on my credit cards im going to continue to use it and pay it off every week like i have been doing. I can understand some kid who gets a card and has never been responsible for their own money because mommy and daddy pay for everything but i aint that kid. Those are the ones who rack up thousands and dont even have to worry about it becuase there rents will pick up the tab and give them a slap on the wrist

Well of cource i dont want to be in debt. I much rather have no bike payment but that money is for college in the fall so its staying put. If you payed with cash though for your house, isnt that hurting you in taxes? I mean you do get to deduct any interest on a mortage every year so why pay it off early? My GFs grandmother makes like 90,000 a year and put a mortage back on her house just as a tax shelter. http://www.alllaw.com/articles/tax/article3.asp Then again you say you paid off your house making 40 grand. So i guessing you rented until you were able to buy a house for cheap? Im not trying to argue with you just trying to understand this more. You bring up alot of good points and granted i havent payed a dime in interest on my credit cards im going to continue to use it and pay it off every week like i have been doing. I can understand some kid who gets a card and has never been responsible for their own money because mommy and daddy pay for everything but i aint that kid. Those are the ones who rack up thousands and dont even have to worry about it becuase there rents will pick up the tab and give them a slap on the wrist

Using YOUR SOURCE... He spends $11,400 on interest and saved $3720 on taxes... He loses $7680 by saving some money on his taxes... Not a very sound plan your girls G-ma is following...



I was also curious on how you recommend to pay a house off really early. I am looking at 10 years now... I know a few people that have done it but they all had high incomes. My buddy paid off a modest house in 4 years - But he makes well over 100k. Every penny he made paid off the mortgage and they lived off the 50k or so that his wife made. Not pinching pennies - but they weren't living large.... Now they have more money than they know what to do with. They own everything they have and they invest and they still literally piss money away.

I agree that renting and saving doesn't make much sense because you are out your rent every month that could go towards the mortgage.

Dorkfish - I am starting to see the errors of my ways (typical american with good credit - finance EVERYTHING even when I have the cash!!! You said zero percent? Sign me up! I'll set up auto pay and have my bank send you a check every month!). I want to be more like you (it makes so much sense)! I am assuming that you would buy the house and unleash hell on the mortgage??? What is your suggestion?

Well of cource i dont want to be in debt.

Then quit borrowing money. If you borrow money, you're in debt.

I much rather have no bike payment but that money is for college in the fall so its staying put.

You missed the point. You've put your Dad on the hook because you didn't want to make choices. You had enough money to go to school OR to buy a bike. You stomped your little feet and said "I want it, and I want it NOW!". You can't save and spend the same money.

If you payed with cash though for your house, isnt that hurting you in taxes? I mean you do get to deduct any interest on a mortage every year so why pay it off early? My GFs grandmother makes like 90,000 a year and put a mortage back on her house just as a taxshelter.

As was explained above, your gal's granny got some reeeeeally horrible advise. People who take advantage of the elderly ought to be horse-whipped.

Then again you say you paid off your house making 40 grand. So i guessing you rented until you were able to buy a house for cheap? Im not trying to argue with you just trying to understand this more.

Don't worry, you're not prying too much or being argumentative. I paid for my house with money that I invested throughout the '90s while I was in the service living in base housing. I invested my combat zone tax rebates, my per diem, and around 40% of my income. When I got out, I did exactly what everyone else in the US does: I got a mortgage despite having the money to write a check for the house. Listening to the Dave Ramsey Radio Show showed me the error of that particular bit of "normalcy". So I cashed out enough of my non-retirement investments to pay off the 145K I owed on my house. Then I re-directed my $960/month house payment back into investments, where it's rapidly growing back. About a year and a half later, I sold that house for $220K and bought my current house for 259K cash, pulling the difference out of that same investment. Last spring, my realtor told me she could comfortably get 325k for the house.


You bring up alot of good points...

Thanks. My over-arching desire is to convince people there's nothing special about wealthy people. They have better money-handling habits than broke people. I know what those habits are, and I know that if I can convince you to use them - forever - you'll retire rich and leave a legacy for your kids.


I can understand some kid who gets a card and has never been responsible for their own money because mommy and daddy pay for everything but i aint that kid. Those are the ones who rack up thousands and dont even have to worry about it becuase there rents will pick up the tab

As gently as I can say this: what's the difference between that and co-signing?

wtchtwr,
I'll write up the comprehensive plan in a separate thread.

wtchtwr,
I'll write up the comprehensive plan in a separate thread.

:punk Thanks buddy! I was a f'n economics major finance minor - and they tell you about leveraging and writing off your interest and all that b.s. It was like a prep course in being in debt the rest of your life. It wasn't until you spelled it out that I realized that I was spending a shitload of money to save a few bucks... My old accountant even told me to leverage one of my FL houses to get the tax writeoff when I had cash on hand... I drank a gallon of the fucking "finance it" koolaide....

Everything you EVER wanted to know about credit and how to use it is here...

http://creditboards.com/forums/index.php?

GL

I only started to build my credit when I was 20 years old. I got a starters credit card that has a $500 limit. I only used it to buy Taco Bell or other cheap food when I was hungry. I couldn't do a thing though because I was new to the country. I couldn't get a cell phone, couldn't buy a car without my dad co-signing for it. It was very tough.

What I do... Is I pay my car loan and still keep my credit card to under $100. I'm gaining a credit history slowly, but I'm not breaking my back doing it. I'm saving up atleast 3/4 of a down payment on a new bike. Or, if I can find a used one that's decent for pretty cheap, then I'll buy it for cash.

To establish credit you need to qualify first for I first. Lending institutions are all about risk assessment; they want to see how “creditable” are you.

If you are a CU member get a signature Visa, small amount. Start paying your cell bill with and pay if off each month. Small steps like this allow you to create credit history which the creditors like. I bought a fridge last year from Home Depot, I had the cash but they had a 6 month no interest offer on the their store card. I got the card, bought the fridge (10% off first purchase) and paid it off before the payment came due. I now have a credit line that I don’t use but it widens my available credit base. I did this for my wife we got married, started with an American Eagle Card, and now her score is better than mine.

Hope that helps. :biggrin

Yeah.... Don't do any of the stuff outlined above. Focus on having "money" in the form of "net worth" and let poseurs worry about their "credit base".

You'll be unique. Wealth is rare - good credit is not.

Yeah.... Don't do any of the stuff outlined above. Focus on having "money" in the form of "net worth" and let poseurs worry about their "credit base".

You'll be unique. Wealth is rare - good credit is not.

:clap