Abandon Nest

In my last post on money I went a little off the deep end halfway through the post. I may have come across as a little harsh and I think part of that comes from the financial reality of my childhood. This isn’t an apology post, however. I’d just like to offer up a view of someone who actually seems to get personal financial responsibilty. Her name is Claire and she posts over at Tired but Happy (great blog by the way, check it out).

In one of her recent posts she discusses her credit card philosophy. In it she lists six goals that she uses when making credit card decisions. They’re all great and, while she doesn’t expand on them, I’d like to take this opportunity to do so.

• Pay balances off in full each month - The best strategy for anyone who uses credit cards. Why carry around a balance that you’re just going to end up paying interest on? You’ll be responsible for someone else making money. Don’t do it.
• Pay no annual fees - It is my personal opinion that paying fees is like throwing your money out the window or burning it. When there are so many feeless options, what would possess you to pay to give someone else your money?
• Keep cards with long histories to boost credit scores - When you find a card that you like, keep it around. Follow the above two points and build up a great credit rating with a long-term credit committment.
• Maintain at least one joint card with my spouse - I can’t really comment accurately on this one yet, as I’m not married, but it sounds like a great idea. Maybe someone with a little more experience can expand on why in the comments.
• Maintain one card in my own name only and make sure my spouse does the same - This I know is a good idea. It is important to maintain your own good credit history in case something bad happens. (Something bad includes divorce and/or death) If all the good credit is in your wife’s name, and she leaves you, how will you be able to get a credit line on anythign?
• Maximize rewards, prioritizing cashback over miles or other points systems - My girlfriend is a firm believer in cashback rewards. She prefers Discover but there are plenty of cards to choose from. In my own experience, cashback tends to build up faster than point or other reward cards.

What kind of goals do you have for credit card use? Do you have anything to add to this list?

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