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12-01-2009, 10:12 AM
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#21
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
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The only change to my credit cards is that one of them has watered down the value of "points" for air travel. As their cash back hasn't changed and that's the option I choose, it hasn't affected me. Plus, this is only a 1% cash back card and these days I mostly use the Schwab 2% Visa card.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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12-01-2009, 10:29 AM
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#22
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2005
Location: Chicago
Posts: 13,186
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Quote:
Originally Posted by hguyw
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Pulliam is exactly the type of person we don't need advising folks about their financial matters. Arguing that the use of expensive, short term, unsecured credit is good and/or necessary for typical Americans is nothing short of sabotage. Despite her outrage that rates are going up, even at previous lower rates carrying a substantial ongoing balance on a credit card is financial ineptitude. Why is she supporting that?
I hope credit card companies raise rates and terms to such horrendous levels that all Americans use credit cards only on a pay in full each month basis or simply don't use cards at all. IMO, Congresscritters need to spend more on educating the American public about credit and less on legislating to protect hapless spenders.
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
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12-01-2009, 10:50 AM
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#23
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2009
Posts: 5,308
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Quote:
Originally Posted by kyounge1956
I will never understand the thinking of credit rating agencies, if they take the fact that my only debt is my mortgage as evidence of financial irresponsibility on my part.
I paid mine off years ago, before I ever heard of Dave Ramsey. Did your contact at State Farm give you any idea of how big a price differential there is on car/auto insurance between credit rating based on one debt and credit rating based on no debts?
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I don't think I kept it but in our recent insurance renewals there was a sheet showing how the rate varied based upon credit score. As a recall it was a significant difference.
I went and found an article at Kiplinger's which says "A recent survey by Consumer Reports among eight popular auto insurers found that drivers with top scores could pay up to 31% less on their premiums than if credit scoring wasn't factored in, while those with bad scores would pay as much as 143% more."
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12-01-2009, 10:59 AM
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#24
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
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Quote:
Originally Posted by youbet
IMO, Congresscritters need to spend more on educating the American public about credit and less on legislating to protect hapless spenders.
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I agree with you about the abysmal state of financial education, but I don't quite see how Congress should be involved. I'd love to see a semester of personal finance be a high school graduation requirement, but that's up to the local school boards and (in some cases) state requirements. I suspect Congress would only muck it up.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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12-01-2009, 11:07 AM
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#25
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2005
Location: Chicago
Posts: 13,186
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Well Zig, the odds are certainly on your side there. Congresscritters can and do muck up most things they touch. But if they just had to do something about their preoccupation with personal credit and whether citizens are being "victimized" or not, I'd rather see them legislate funding for personal economics education than legislate detailed operating rules for lenders. It's hard for them to do since they vision themselves as heros riding in on the white stallion to help the hapless victim by shooting the bad guy as opposed to empowering the victims to stand up for themselves.
But, I certainly understand your point.
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
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12-01-2009, 11:30 AM
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#26
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Recycles dryer sheets
Join Date: Feb 2008
Posts: 106
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Quote:
Originally Posted by kyounge1956
Did your contact at State Farm give you any idea of how big a price differential there is on car/auto insurance between credit rating based on one debt and credit rating based on no debts?
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No, but I just went back and looked up my insurance payments for the last three years. In 2007 I made some major headway in paying off the last of my CC debt - IIRC I paid off $12,000 in about 10 months. (Final payoff of all CC's was in October of that year.) So here's what happened to my car and homeowner's insurance in that time:
Car Insurance:
3/07 $283.30
9/07 $269.66
3/08 $264.66
9/08 $265.46
3/09 $250.22
9/09 $257.26
Homeowner's Ins.:
7/07 $419.00
7/08 $409.00
7/09 $395.00
These aren't huge decreases, but the overall trend has been down. Can't remember exactly but my credit score was in the high 700s while I was paying down the debt, and when I checked it again last year it was 812.
I just paid off my mortgage on October 26, so it will be interesting to see what happens with my insurance in the future, now that I have zero debt of any kind.
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12-01-2009, 12:17 PM
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#27
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2009
Posts: 6,695
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Hguyw, I worked in the P/C insurance industry for 23 years until I retired from it last year. I specialized in personal auto insurance in the actuarial area.
There are many more factors which can influence one's auto insurance bill than credit score, if credit score affects it at all. In my final few years of working, there was plenty of state litigation about whether it could be used. Some states sought to prohibit it from being used.
But back to insurance rates. The recent loss experience in one's area is a big factor in determinig insurance rates. Furthermore, particularly for auto, there are many coverages one purchases - from No-Fault or Medical Payments to Comprehensive to Collision to Bodily Injury and Property Damage Liability to Uninsured Motorists. The rate for one coverage can rise while the rate for another can fall. With Comp and Collision, a rate tends to fall as the car ages and its book value drops.
An insured can help himself by taking a defensive driving course to get a discount. Simply driving well and remaining accident-free can earn extra discounts.
Homeowners insurance has fewer variables than auto insurance, but loss experience in one's home area plays a big role, too.
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12-01-2009, 12:43 PM
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#28
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Recycles dryer sheets
Join Date: Feb 2008
Posts: 106
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Quote:
Originally Posted by scrabbler1
There are many more factors which can influence one's auto insurance bill than credit score, if credit score affects it at all. In my final few years of working, there was plenty of state litigation about whether it could be used. Some states sought to prohibit it from being used.
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That's pretty much what the State Farm rep told me too - it's a minor factor in determining rates, but they do look at it. (I'm in central/northern NY.) IIRC I asked about it when I'd called to see about raising my deductible; I was more curious than anything.
I do question the fairness of using the credit score tho; a score isn't always low because of irresponsible spending. I can see where someone dealing with overwhelming medical bills could also have a very low score.
Quote:
Homeowners insurance has fewer variables than auto insurance, but loss experience in one's home area plays a big role, too.
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That makes sense. We don't drive our houses down the road at 60+ mph. They more or less stay put.
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12-01-2009, 12:51 PM
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#29
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
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Quote:
Originally Posted by hguyw
I do question the fairness of using the credit score tho; a score isn't always low because of irresponsible spending. I can see where someone dealing with overwhelming medical bills could also have a very low score.
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True, but if there is a provable correlation between credit score and the cost of servicing an account and claims history, it's not really any different than using gender or age or marital status.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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12-01-2009, 03:40 PM
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#30
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Thinks s/he gets paid by the post
Join Date: Jan 2006
Posts: 1,645
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I think I remember USAA posting something saying they don't use credit scores to set auto rates.
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12-01-2009, 03:59 PM
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#31
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
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Realistically, I believe that cancelling an extra CC will only ding your score by a few points, so it should be no big deal. Now that my mortgage refi has gone through, I may kill off an extra card I got when I was stoozing, but have not used since. Just make sure you have access to enough credit for your needs.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
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12-02-2009, 08:04 AM
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#32
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 14,183
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Quote:
Originally Posted by ziggy29
I'd love to see a semester of personal finance be a high school graduation requirement...
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But they might have to cancel the Creation Science class...
__________________
Have Funds, Will Retire
...not doing anything of true substance...
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12-02-2009, 08:28 AM
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#33
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Moderator
Join Date: Dec 2007
Location: Eastern WV Panhandle
Posts: 25,340
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Quote:
Originally Posted by youbet
Well Zig, the odds are certainly on your side there. Congresscritters can and do muck up most things they touch. But if they just had to do something about their preoccupation with personal credit and whether citizens are being "victimized" or not, I'd rather see them legislate funding for personal economics education than legislate detailed operating rules for lenders. It's hard for them to do since they vision themselves as heros riding in on the white stallion to help the hapless victim by shooting the bad guy as opposed to empowering the victims to stand up for themselves.
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But wait! Those borrowers are entitled to the good life! It's the American Dream! Now you're saying that people have to assume responsibility for their debts? Oh, how 19th century can you get?
__________________
When I was a kid I wanted to be older. This is not what I expected.
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12-02-2009, 12:25 PM
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#34
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Full time employment: Posting here.
Join Date: Jan 2008
Posts: 649
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Quote:
Originally Posted by hguyw
That makes sense. We don't drive our houses down the road at 60+ mph. They more or less stay put.
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Audrey did (until her recent home purchase)
__________________
"There is no dignity quite so impressive, and no independence quite so important, as living within your means." Calvin Coolidge
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02-12-2010, 06:33 PM
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#35
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Administrator
Join Date: Apr 2006
Posts: 23,038
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Quote:
Originally Posted by brewer12345
Realistically, I believe that cancelling an extra CC will only ding your score by a few points, so it should be no big deal. Now that my mortgage refi has gone through, I may kill off an extra card I got when I was stoozing, but have not used since. Just make sure you have access to enough credit for your needs.
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Citibank just sent me a letter informing me that they are going to start charging a $60 annual fee. It is a card I used for stoozing about 3 years ago and haven't ever actually charged anything with. So I called them and cancelled the card.
__________________
Living an analog life in the Digital Age.
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