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Anon on credit scores
(sh.itjust.works)
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this post was submitted on 23 Oct 2023
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For 25 years I've only carried a debt on my credit card one time, and that was for a few months under special circumstances. I have a top credit score.
It's a stupid game, but it's easy to play.
Why do Americans think you need to carry a debt to build credit? That is the opposite.
I put EVERYTHING on credit card, and pay everything off on time. Never missed a payment. My credit score was the highest it can be by the time I turned 21. I've never paid a penny in fees or interest.
That's not what they said, and Americans, in general, do not think that.
Holy hell they sure do. A lot of Americans don't even understand you don't immediately start accruing interest. You clearly have not witnessed the absolute insanity of Americans saying that they use a debit card because they "don't want to pay interest" or they "only spend money they have".
Also the comment you're replying to was likely in agreement with the premise established by the person they were replying to.
The ignorance is astounding but to be expected. 12 years of mandatory schooling and not one class on personal finance. These are not difficult concepts. They're just never conveyed.
The 12 years of mandatory schooling that they already get is wasted on most of them anyway. Mention President McKinley, and most Americans will respond with "who?"
Education in the US sucks in a lot of ways for a lot of people for a lot of reasons, and most "students" don't end up retaining much of anything as a result of those forces. We're trained to get grades based on attendance and participation, from material that is taught to the test. Very little of your grade has anything to do with whether you actually learned, digested, and retained anything...
We were all taught about the Whiskey Rebellion in high school. But bring it up in any conversation about taxes, and 99% of the time you'll get a blank stare, or "the what?"
So we can pile "financial literacy" on top of all the other things that are jammed into American curricula, and it won't make a damn bit of difference in the end. Because it doesn't matter what is taught - it's not going to be learned anyway. Payday lenders will still make bank, buy-here-pay-here dealerships will keep recycling the same cars at a huge profit, the poor will still play the lottery, and Santander will keep making car loans to under-qualified applicants at extortionate interest rates. People will still buy $70k pickup trucks on a $50k salary, and roll their negative equity into the next overpriced consumer wealth/masculinity signaling device.
I arrived to the US less than 5 years ago and I have top credit score. I never carry a balance, open credit cards that offer a lot of credit, benefits and bonus to increase my available credit (I have about 6 or 7 cards at the moment) and just wait. In less than a year I already had 740 which was enough to get a car loan with 1.9% apr (lowest offered was 1.85%)
I’m the same as you, and I think we kinda had an advantage because we started with a blank slate. No student loans (if you arrived as a working adult), no prior debts, and hitting the ground running (if you arrived with a job waiting for you).
Survivorship bias!!
Not survivorship bias.
Care to elaborate on why not?
Just so I know. I’m not saying you’re wrong.
I understand what survivorship bias is, I just don't see how it applies here. Could you explain?
That just because you managed to do that doesn’t make it the norm.
You could argue that that simply isn’t an option for many people. If you can live life without using a credit card implies you have not struggled for that extra cash, whereas some people simply don’t make enough to not use it.
I still don't see how this makes it survivorship bias.
But that being said, if you're not going to be able to pay off something in a few months, then you can't afford it with or without a card, because buying it with the card just makes it more expensive. Sometimes you need to tide yourself over, I did that when my wife was switching jobs and we were moving so there were extra expenses. But I quickly paid it all off when we returned to normal income.
I believe it’s SB just for the fact that having a line of credit available and not using it simply isn’t an option for some people.
Imagine you have a line of credit and you lose your job, but you still need to feed your family. Then that person is going to do what they need to provide food.
The bias come from you commenting in the vain of I did this, ergo everybody else should be the same, when in fact we are not all the same.
Similar to how someone from a council estate can make it as a politician, which neglects to consider that 99% of people from council estates with that dream didn’t make it.
I hope that makes more sense. I suck at explaining things.