How do you feel about credit cards?

[vees]

I'm thinking about writing a short article about how the recent threats from the credit card companies are going to change people's habits. I'd like to get a feeling for how y'all plan to or are handling the recent changes. Results are hidden, except to me. Comments welcome!

Poll

Comments

[illusiongrl]

I don't actually use credit cards, so my opinions maybe shouldn't count. Mostly my opinion is based on the credit cards I manage at the office. We pay off every month, so I'd totally drop a card w/o a grace period.

My personal philosophy, though, is don't spend it if you don't have it.

[brcmapgirl]

Your poll is flawed because a self-selecting group of your friends is reading your blog and generally since birds of a feather flock together, your poll answers will be horribly skewed towards fiscal responsibility/cash model.

The other confounding factor in your poll is that if you log IP addresses (as you are right now) people may be inclined to answer less honestly because they are being indirectly monitored.

Of course, I will be honest and tell you that *I* am the person who always carries a balance. But that's at 2.99% and is actually less than my mortgage. I will continue to deleverage my condo in the method *you taught me*. HAHAHA

[vees]

I'm not going to use the results of this as scientific evidence of anything, just as a zeitgeist of my friends. If my friends skew towards cash and responsibility, that's an interesting point to write about.

I did disclose in the top that results are visible to me, which folks like unprotoize have mentioned in the past is a deal-breaker for private questions. There's not really a whole lot I can do about that.

Are you talking about balance transfer arbitrage?

[brcmapgirl]

Not strictly arbitrage. Arbitrage would mean I was getting a direct benefit from lowered rates. I'm talking about deleveraging the HELOC onto credit card BT's, something you told me you were doing.

Yes, there is an interest rate arbitrage play happening there, but it was more about deleveraging the house and lessening the debt on it.

I am perfectly blunt about it obviously because most of our friends can just go read my topical blog. But I do see Proto's point which is why I point this out.

You know I do some statistical sampling work right now, right? Therefore all 'polling/sampling' is endlessly fascinating to me.

[vees]

Yeah definitely if there's no or little cost of transferring between multiple loan accounts, the money should always flow into the one with the smallest rate.

I haven't had a good low APR balance transfer offer, or one without a 3% plus $50 transfer cost in months and months so my outstanding balance has been setting in the HELOC and gets an auto-pay of $50/week at the minimum.

Since my interest comes out to about $15 (tax deductible) every month, it would take better than ten months just to break even on a 3% transfer cost even with a 0% teaser. If I got a penalty-free 0% transfer I'd take it in a heartbeat and pocket the difference.

But of course I'd be the only one to profit from that deal.

[vees]

Yeah, the industry threat is to treat purchases in the future the same way they treat cash now. As soon as the funds are dispersed, you start paying an interest penalty.

[vees]

Yeah it's mostly meaningless political posturing, but I'm curious how meaningless it is to my friends. So far nobody is saying they'd be remotely hurt by credit card company shenanigans.

[mcfnord]

i have a unique relationship with credit. in 2006 i aquired as many as i could in rapid succession, getting the 0% balance transfer money, until i eventually held $80k. during this time i paid no pennies toward interest. the last of these is ending this month. credit interests me none if it costs any money. even the 0% transfer stuff actually costs 2% or more now so forget it.

[vees]

I made about $700 in balance transfer arbitrage a few years ago. I'm not sure what the total amount was but I think it was near $30k.

[mcfnord]

those were the days!

debit only

[photocindy23]

I'm with quite a few others, it seems; I don't have or use a credit card of any kind. So, cash-only girl, here. Within my means and all that.

Otherwise-wise, I'd have a house full of filmmaking equipment, and be up to my eyeballs in debt. I prefer the challenge of making a film with a $100 video camera...