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March 31, 2005

More Credit

On the subject of credit, thanks to everyone who posted with your tips.

Basically, I want to be able to buy a house in New Zealand sometime around age 30-33 when I’m a legal permanent resident there. This is going to take credit.

In the mean time, there isn’t much of anything I need (though Cathy’s remark about using it as health insurance is extremely well taken). I wouldn’t mind buying a CD or two or a program each month on it and paying it off rapidly. I also wouldn’t mind buying some furniture up here (a sofa, for one thing) and Michael suggested buying things in that price range on credit, dinking with it on the card for 4 months or so and then killing it off. The one thing I think I would really like to have is a new PowerBook but Apple roundly rejected the idea of giving me their credit card. Allan suggested a loan with the laptop as collatoral, which seems like a brilliant idea, but which Michael doesn’t think the bank will go for because it’s hard to appraise computer equipment.

So, my plan is basically this:

  1. Go ask McBank for whatever credit card they’ll give me.
  2. Go ask McBank for a loan for a PowerBook when the G5’s come out.

As much as I like the latter, it seems too good to be true. But in the land of credit, “too good to be true” seems to be the way it works (i.e. the way you get fucked). So we’ll see.

Posted by FusionGyro at March 31, 2005 12:18 AM

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You will have a tough time with the latter because they will already be hesitant to give you a credit card let alone a credit card that basically has a limit of the cost of the laptop.

I definitely recommend getting a credit card from McBank betweeen $500-$1000, enough to buy some not-too-spendy furniture or whatever. Then stop using it and pay it off over a few months. This will show that you have the ability to hold credit for items that you can still afford, but pay them off over time and you keep your overall balance low (don’t max it out). Over the course of keeping the same card (this is important) for about 2 years (it’s most likely initial expiration date), your credit will begin building.

Once you have that down, it becomes much easier to get something like a car loan or a computer loan assuming your debt-to-income ratio is decent.

Posted by: Shippy at April 1, 2005 04:36 PM

Oh yeah, I don’t agree with wonko. The key term is ‘radical’ there. Retirement will happen for you if you take charge of your own retirement. You just have to be sure you save a good amount away (usually 25% of your income), but you have to invest it in some fashion. Make your money work for you. By the time you hit retirement age, you’ll be able to die broke, but you won’t have to work for the last quarter of your life. Retirement was coined during the Depression, but that’s because Social Security came around then, but you shouldn’t depend on Social Security anymore. The gov’t doesn’t spend your money wisely so you shouldn’t rely on its programs to take care of yourself or your relatives (which it seems this book wants to imply). This book is just a radical way of thinking to give hope to the Baby Boomers that put all their eggs in one basket and then lost ‘em. They’re not as young as we are so they have to save differently than us. Just be responsible and you’ll be able to have both the things you want, but be able to stop working before you’re poopin’ yourself.

Posted by: Shippy at April 1, 2005 04:57 PM

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