Author Topic: Credit cards.  (Read 1986 times)

Offline Pugnate

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Credit cards.
« on: Sunday, October 23, 2016, 03:03:55 PM »
Hey guys,

I want to pay off my credit cards every month so I never have to pay interest. Can someone explain the difference Last Statement Balance and Balance Owing? (I've never had credit cards before and am only using them to build a credit history.)

I am guessing that:

1. Balance Owing is the total amount I owe and is updated in real time.

2. Last Statement Balance is the balance I owe that I must pay by the due date in order to avoid paying interest.

3. Minimum Payment Due is just the minimum I have to pay to avoid it going into collections, but paying just this won't avoid interest.

So as long as I am paying the The Last Statement Balance by the the due date I am not paying interest and I am looking good on my credit history. Am I understanding it correctly? I don't want to settle Balance Owing immediately just because.
« Last Edit: Sunday, October 23, 2016, 08:37:02 PM by Pugnate »

Offline Cobra951

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Re: Credit cards.
« Reply #1 on: Sunday, October 23, 2016, 04:17:12 PM »
As of last time I checked, #2 is correct.  You pay the full amount you've racked up by the due date each month, and you don't incur interest.  Minimum payment is just for for cash-flow emergencies.  You'll pay for half your life, and multiple times what you owe, if you regularly pay the minimum.

Offline ren

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Re: Credit cards.
« Reply #2 on: Monday, October 24, 2016, 11:36:45 AM »
You got it. Pay your Last Statement Balance by the due date and you won't pay any interest.

Offline scottws

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Re: Credit cards.
« Reply #3 on: Thursday, November 03, 2016, 09:03:55 AM »
As the others have said, as long as you pay at least your Last Statement Balance each month, you won't pay interest.

Look for a card with good features.  I have a Citibank Double Cash card that earns me 2% on all purchases (well 1% on purchases and 1% on payment, technically).  Then I have other cards that have quarterly 5% bonuses like shopping at grocery stores, or Costco, or Amazon, or gas stations, or whatever.  It's just annoying because you have to activate and keep track of the promotion.

But these little things do make a difference.  Sometimes I'll literally save $70 in a month just by my credit card choice alone.  I put the down payment on my car on a credit card just to get the cash back.

Anymore, I only use cash if there is a credit card surcharge that exceeds the 2% or 5% or whatever.

Offline Pugnate

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Re: Credit cards.
« Reply #4 on: Thursday, November 03, 2016, 09:34:10 AM »
You are right. It's complicated to keep track but worthwhile to do so.

At the same time I've heard that it isn't good for your credit rating to have too many cards. Shouldn't have more than two or three according to some expert I saw on TV.

Offline Cobra951

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Re: Credit cards.
« Reply #5 on: Thursday, November 03, 2016, 09:50:31 AM »
There's a sweet spot on the amount of credit you have quick access to.  I don't know exactly what it is, though.  Too little credit is also harmful to your rating.

Offline scottws

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Re: Credit cards.
« Reply #6 on: Friday, November 04, 2016, 10:03:17 PM »
I've got a bunch of credit cards and just financed a car and my rating went up. Go figure.

Offline Pugnate

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Re: Credit cards.
« Reply #7 on: Friday, November 04, 2016, 10:16:00 PM »


This was a bit scary.

Offline gpw11

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Re: Credit cards.
« Reply #8 on: Sunday, November 06, 2016, 12:30:45 PM »
I've got a bunch of credit cards and just financed a car and my rating went up. Go figure.

The ratings are complicated on their own but as far as any lender is concerned they don't mean all that much.  Like, if I was going to go in to apply for a mortgage or new Line of Credit they'd definitely pull my rating to take a look but they'd weigh the rating a lot lower than other factors (income, equity, TYPE of debt I carry, etc).   

What you mention is part of the reason why - you can make sudden movements to raise or lower your rating drastically in a short amount of time, which isn't a great indication of your financial status or reliability.   Hence, the credit report itself is much much more valuable than the actual rating.   


Note, in Canada you're entitled to one free check of your credit report a year to make sure that there aren't any errors on it.  This won't give you the rating, but will give you the report.   

Also of note, Pug, is that I've never run into a credit check for a job or when renting in Canada. I know it's more common down south and might be spreading here but I've still never run into it.

I wouldn't stress about yours too much, just use the credit card and pay the bill.   In your case, time will be the biggest factor in your credit improving.