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Discussion Starter · #2 ·
And to start things off - do any of you use any kind of general budget tracking software, or even a spreadsheet? I keep solid records of all of my major bills (car, bike, credit cards, etc), but my general day to day purchases (beers, smokes :(, lunch, strings, bullshit) I don't track, and I think if I did I might be horrified to find out just how much of my money I blow on random crap.

My parents are retired, so my pops tracks his whole budget. Everything he spends on gas, food, golf balls, you name it - he keeps a log of it in a spreadsheet. At the end of every month he has a great perspective on where his money is going and places he can save. I'm tempted to start doing the same, but with the amount of travel I do (and the fact that I don't bring lunch to work like an asshole) it might be a pretty daunting task.

Anyone have any pointers, if you do this? I'm looking at Quicken, and for $70 it seems pretty slick, and one of the best things about it is that it will automatically grab all of my current bank information (Bank of America) and import it right in, so I'd immediately have a ~1 year perspective.
 

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Bro of Bros, Bro.
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I don't track, and I think if I did I might be horrified to find out just how much of my money I blow on random crap.
I started tracking the small stuff, and it scared me so much I stopped doing it. It was a rather sobering experience realizing how much time and money I was spending going out to bars.
 

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My financial adviser said if you can get a credit card with a good cash back bonus on it (say 5%) and you pay off your balance each month you can get back $5k on $100k at the end of the year (he uses it for Xmas shopping)

To put this in perspective If I were to receive %5 back on just my Gas and Grocery purchases for the year I would get 500 bucks cashback. Not too shabby really....

My father in law tracks everything with Quicken. He said it really helps at tax time as it makes it easier to find all of his deductions.
 

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Volvo Mis-Enthusiast
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I am 20 years old and I live with my father. I work part time (if you want to call 10 hours a week part time... :rant:) and go to school full time. I pay for my share of my band's practice space rent ($75), and basically anything that I don't eat or use at home. I also try and fill up my dad's and my mom's car, as I drive them around quite a bit. I pay for car and guitar parts out of my own pocket... I'll being doing the timing belt on my mom's car when it stops snowing in Texas (in MARCH).

I use my online banking with BOA to keep track of everything. I've got a checking, saving, and credit card account with them. I've gone entirely paperless and almost exclusively move money around online. :shrug:

I've found the best way for me to save money is to simply... walk around without any. :lol: Sure, I may need gas money or whatever, but it creates and incentive to eat at home and otherwise manage money wisely. :yesway:
 

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MG.org-er
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This is a really useful thread for someone who's due to leave home for university in 6 months (like me). :agreed:

I must get into the habit of tracking every purchase that I make. My family and I calculated that money will be tight when I'm at uni, so I will have to be viligant.
 

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It's not lupus.
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To save money I simply don't spend it... Which is kind of a stupid statement, but realistically, I limit my purchases to stuff I really need and only rarely buy stuff I want.

I keep at least $1,000 the bank at all times for emergency use. If I want to make a purchase of something that I want, but don't need (new guitars, amps, games, sports equipment, etc.), I will not purchase it unless I have at least double that much saved beyond my normal $1,000 minimum. Example: I want a $600 gun. I wouldn't purchase it unless I had $2,200 available.
 

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DOO)))M
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I do financing normally on Tuesday or Wednesday since my payday is Thursday. Breaks down into normally :

Lessons
Gas (if needed)
Bill (if due)
Random here and there (give $30 as an estimate)

Then I take whatever's left (not very much) and put it into my saving towards my new car. Over the summer I'm gonna try to get a second job so that my main job (pharmacy) will be the Bills/Gas/Living expenses job and the second job will be the 'all my money towards my new car or small gear here and there' fund
 

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sawdust aficionado
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I've been using a simple Excel spreadsheet for the past 8 years. Food, gas-car, gas-house, electric, insurance, mortgage, etc. have their own column so it's easy to see where the money goes.
 

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Yeah, you can really do a LOT with Excel.

It's been a long time since I've sat down and done a proper budget - these days, I mostly just keep an eye on my checking account balance, use automated payments whenever possible, and do most of my saving through automated transfers into a BoA savings and ING savings account. I should probably do something a little more formal, though, simply because it HAS been a while.
 

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For you young guys take this advice.

Dont ever use a credit card unless you can pay off the balance post haste. You can really pile on debt if you just start charging everything. Whenever you are thinking about making a major purchase - take the time to really consider what you are getting yourself into. Say you buy a new car .... then 6 months later you lose your job and your unemployment isn't enough to cover your rent/utilities/other bills and car payment.... what would you do?

Ideally you should have about 6 to 9 months pay in savings as a safety net/ emergency fund but I know it can be really tough to save when you are just getting by paycheck to paycheck.
 

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THUNDERBEEEEAR!
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Yeah, you can really do a LOT with Excel.

It's been a long time since I've sat down and done a proper budget - these days, I mostly just keep an eye on my checking account balance, use automated payments whenever possible, and do most of my saving through automated transfers into a BoA savings and ING savings account. I should probably do something a little more formal, though, simply because it HAS been a while.
What would be really cool is if you made your formal stuff into a "excel for the horrendously stupid". I haven't got a clue to how that works.

I use automated payments as much as possible and monthly transfers to my savings account. works well, but I should tighten things up a bit. you never know when shit hits the fan.
 

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DOO)))M
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For you young guys take this advice.

Dont ever use a credit card unless you can pay off the balance post haste. You can really pile on debt if you just start charging everything. Whenever you are thinking about making a major purchase - take the time to really consider what you are getting yourself into. Say you buy a new car .... then 6 months later you lose your job and your unemployment isn't enough to cover your rent/utilities/other bills and car payment.... what would you do?

Ideally you should have about 6 to 9 months pay in savings as a safety net/ emergency fund but I know it can be really tough to save when you are just getting by paycheck to paycheck.
One thing I try to do with credit cards.... only buy something with them that I'll still be using when it's paid off. So no going out drinking, or vacations etc. on the credit cards.
As someone who doesn't have a credit card, these are some of the reasons I've put off getting one. I have a hinting suspicion that once I do get it, I'll use it too much (on slightly big things) and not pay it off immediately and fuck my credit over.

If/when I do get a card, I plan on using it for mainly meals during work (like $4 or so), drinks, etc... so that I only pay off like $40 maximum a month instead of dealing with X amount of payments over Y amount of months to be debt free.
 

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Motherfucker.
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I worked out how much I spend (approx.) on drinking in a year the other day...holy fuck, it's a scary figure to say the least. Admittedly the money I save for the weekend is half of what it used to be as I worked out some time ago that what I was saving for the weekend, I was using all of.

However, it might be time to tighten the strings a bit more. I have savings, but I like a nice fat bank account because it makes me feel safer if anything dire ever happened.

A spreadsheet of my weekly expenses/purchases would be a real eye-opener. At the moment I'm glad I don't own a car as, from what a mate was telling me today, he hasn't used his for a month because it's actually cheaper to get public transportation than it is to run his motor.
 

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Bro of Bros, Bro.
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As someone who doesn't have a credit card, these are some of the reasons I've put off getting one. I have a hinting suspicion that once I do get it, I'll use it too much (on slightly big things) and not pay it off immediately and fuck my credit over.

If/when I do get a card, I plan on using it for mainly meals during work (like $4 or so), drinks, etc... so that I only pay off like $40 maximum a month instead of dealing with X amount of payments over Y amount of months to be debt free.
Believe it or not, it's actually good to have a credit card and carry a balance. It will actually help your score. Paying off credit cards can actually be bad for your score as they say you are "actively managing your credit" and it can be tough to get a credit card if you don't maintain a certain credit balance history. They really like for you to pay X amount a month for Y amount of months.
 

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DOO)))M
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Believe it or not, it's actually good to have a credit card and carry a balance. It will actually help your score. Paying off credit cards can actually be bad for your score as they say you are "actively managing your credit" and it can be tough to get a credit card if you don't maintain a certain credit balance history. They really like for you to pay X amount a month for Y amount of months.
Oh yeah definitely, that's what my mom is always telling me; I'm just still really unsure of myself with that kind of power :lol:
 

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Discussion Starter · #18 ·
I am a credit nazi and will elaborate more later, but here's a quick nutshell.

What you want to build good credit:

4 Open Lines of Credit

Not 3, not 5, four.

  • Two of them should be revolving accounts, like credit cards.
  • One of them should be over two years old and in good standing (student loans are perfect for this).
  • The last should be a loan/line of credit. For example a personal loan, or a car loan.

This is the "optimal" credit outlook that you want to have when applying for _anything_, along with (of course) a high score. This advice is straight from my credit union's loan agent for mortgages, and lots of credit forums and the like will agree. If you have more than two credit cards, you have too much credit floating around. Close the rest, keep two.

Keep your balances at or below 50%.

Just because you have a 5,000 limit doesn't mean that you should go out and charge up $4800 worth of shit. The amount of CC usage you have directly impacts your credit score. If you have high balances and are car-shopping, STOP. Pay them down a bit and then go back out, your APR will be a LOT better. 2-3% over the life of a loan on a 30,000 loan is a lot of money.

There are two types of credit inquiries. Hard, and soft.

Soft inquiries are generally you, getting your credit report, or your current lenders checking up on you to make sure that their accountholders are keeping their other accounts in good standing. These do not adversely effect your credit score, though they do go on your report. If you use a credit monitoring service, you can soft-inquire until your heart's content with no worries. Google this for more, the important one is next:

Hard inquiries occur every time you apply for a line of credit, or if your credit score is pulled for the purpose of getting a loan, line increase, or background check (eg: for an apartment lease agreement). Hard inquiries aren't "bad", per se, but they do directly and immediately effect your credit score if you have upwards of 5-7 (depending on the bureau) on your credit report. If you are constantly applying for cards, store lines of credit or auto loans, this WILL bring your score down. Hard inquiries stay on your report for just over two years, about 26 months before they start dropping off.

THIS IS ESPECIALLY IMPORTANT TO KEEP IN MIND WHEN CAR SHOPPING, ESPECIALLY FOR A USED CAR. If you are at a Dealer, that dealer will (generally) do a single hard inquiry on your report, and use the dealer's credit service to shop your credit score around to get the best rate. This is the way to go, keeping in mind the following: EVERY time you apply for credit at a different dealership, it is a hard inquiry. It doesn't matter if two dealerships use the same bank, it will be a unique, score-impacting inquiry for each. So whatever you do, DO NOT let the dealer run your credit, at all, until you are absolutely, positively sure that you have found the car, and the dealer that you want.

USED CAR DEALERS ARE THE FUCKING DEVIL, AND WILL FUCK YOU. If the dealer specialized in used cars, chances are they have a good amount of banks to go through. They also see a lot of people with bad credit, who are drawn in by the "Bad Credit?! No Problem!" signs.

STAY AWAY FROM THESE PLACES. What can happen here is this: Say for example your credit score isn't the best, say low 600's. That's at the low end of "fair", and almost "poor", but you can still get a car loan. You'll probably pay an APR in the 19's. However, you need a car and there's nothing else you can really do about it. What the dealer will do is have you fill out a credit app, and they will SHIP THAT FUCKING THING TO EVERY SINGLE BANK THEY POSSIBLY CAN TO GET YOU THE LOWEST APR. That can be 1, 3, 5, 10 banks. I helped an old roommate get his credit in order a couple of years ago, and he had seven hard inquiries in one afternoon, from one dealership, for one car.

Go in there armed. Know your credit score, and once you decide on a used car, ask them what banks they go through. Then stop. Don't fill the app out. Go online, and get your FICO score. (I'll go into this later). Then go home, and call up the banks that the dealer goes through and be straightforward with them. "I am Bob, my FICO is 613 and I want a car that's $15k and a 48 month loan". Generally they'll be able to tell you without pulling your score if you're apt to get approved.

Bottom line: DO NOT LET THE USED CAR DEALER RUN YOUR CREDIT UNTIL YOU ARE READY TO BUY AND HAVE CONTACTED THE BANK ON YOUR OWN. You can bomb a score 50+ points or more in an afternoon at one of these shady places, and that will fuck you APR-wise like no tomorrow.

Use a credit monitoring service. Now.

I use CreditExpert.com, and have for about 5 years. It's great. You can perform unlimited soft inquiries (no impact on credit score), and it archives your reports for you. There are also a bunch of great tools including a score illustrator that will show you an estimate of your credit score if you cut down balances, lose inquiries etc. It's $10/mo and well worth it. CE will also email you immediately any time any change is made to your report - wether it's a new inquiry, a new line of credit or a late payment.

These things can save your ass. If someone steals your ID, signs up for something with your info, if you lose your wallet or even if you fuck up your banking and are late on a payment, this will trigger an alert. Generally if you're 5 days late on a CC and you've always been on time, you can call the bank up and explain to them. 99% of the time they will take care of you, but it's up to you to stay on top of it.

If you have a low APR card with a high balance, pay it down NOW before it becomes a high APR card.

I recently ditched Discover, because after 10 years of perfect payments, my $3500 balance/$15000 limit 2.9% "forever" card suddenly went up to 21% for no explicable reason. When I called, the guy on the other end was completely straightforward with me: Because of the new legislation, they are doing this to everyone with a high credit limit, regardless.

As I understand it, I'm a liability because I have $11k of credit available at a low APR, so they do the industry thing and jack my rate up so that I close my account. I did.

If you're paying $150/mo on a low APR, that payment can quickly become $250/mo and even less gets taken off principle, for no reason other than the CC industry is a train wreck right now.

Anyway..

All that said, be smart. Do the right thing, and if you can't save up for it within a few months, don't buy it. Don't pay interest on a vacation, or a bar tab, or dinner. It makes no sense. Right now is the absolute worst time to be anything but completely diligent with your credit and spending. Stay on top of your credit score, stay away from your credit cards, and wait until the waters cool before you go make any large purchases on credit.

If any of you want tips/help/advice with getting your credit in order, fire me a PM. I had shit-tastic credit out of college because I got a bunch of "sign up for card, get tee shirt!" cards in college, spent that money on beer, and promptly ignored them until they came back to bite me in the ass. :lol:

I spent the last 5-6 years analyzing and researching the shit out of all things credit, and I've helped a bunch of my friends go from low 500's to mid to high 600's in short time. My score out of college was in the 500's, and it's in the high 700's today because I am fucking neurotic about it, and I'd be glad to offer any advice I can. :wub:

I guess that wasn't so short. :lol: I feel like Drew!
 

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Bro of Bros, Bro.
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What you want to build good credit:

4 Open Lines of Credit

Not 3, not 5, four.

  • Two of them should be revolving accounts, like credit cards.
Chris, that is all some excellent information. I just want to elaborate a little bit on this point.

One thing that will look negative in the creditors eyes is if one of these accounts is, say, a department store like Victoria's Secret (which I'm sure applies to a lot of you guys here).

It is completely fine to have a department store balance, but you want to make sure that it is less than 50% of your credit lines out there. So if you have a Capital One card with a $1500 balance on it, try to make sure that you're not buying more that $1000 worth of lingerie for the lady friend.
 
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