Is anyone successfully doing this on a massive scale? What are your experiences so far?
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Anyone successfully doing this?
- Thread starter fenix
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This person might find it hard later on trying to get a mortgage. Every new credit card application, or any credit application per se, is a hit on your credit file. It will stay there for so many years. This could work against you later down the track when lenders look at your credit file and see so many (bad debt) transactions in short period of time. They will flag you as a high risk borrower and could potentially decline every application you make in the future.
To each his own I guess, but not for me....
The dude is quite correct. Credit cards and discipline are great partners.
But most of the populus don't have discipline and THAT'S what the banks count on. But that's ok ...we'll always need tenants !! LL ( Who has several credit cards with huge limits that are never used and pays off the full amount every month.)
But most of the populus don't have discipline and THAT'S what the banks count on. But that's ok ...we'll always need tenants !! LL ( Who has several credit cards with huge limits that are never used and pays off the full amount every month.)
I investigated this a few times in my life, and on paper I love the idea,
the only problem I have found is that, a lot of htese cards have one of or more of annual fees, balance transfer fee etc. etc.
some say fee free for the first year, so if you are relying on getting the first year waived when its not free, the threat of walking doesnt work all the time
also, you have to be pretty disciplined, if you put away say $2.5k per month, you are essentially saving $15k per year average @ 5% which is $750 per year,
minus the fees, and you might save $500 in interest,
better then nothing yes I agree
but BTs dont come across all the time,
plus the hits on your credit, cant be a good thing
the only problem I have found is that, a lot of htese cards have one of or more of annual fees, balance transfer fee etc. etc.
some say fee free for the first year, so if you are relying on getting the first year waived when its not free, the threat of walking doesnt work all the time
also, you have to be pretty disciplined, if you put away say $2.5k per month, you are essentially saving $15k per year average @ 5% which is $750 per year,
minus the fees, and you might save $500 in interest,
better then nothing yes I agree
but BTs dont come across all the time,
plus the hits on your credit, cant be a good thing
Rolling over half a dozen cards every 12-18-24 months is a great way of burning your credit file.
The effort vs. value isn't high enough in my opinion, if only people started looking a bit more heavily on the income column, instead of the expenditure they'd realise their true potential.
The effort vs. value isn't high enough in my opinion, if only people started looking a bit more heavily on the income column, instead of the expenditure they'd realise their true potential.
I did this for a period of 12 months and came to same conclusion - it simply wasn't worth the effort and the amount of applications required per year was too high for my liking.
Also the guy wears a bow tie.... that's enough for me not to take him seriously.
Too much effort to save a little bit more.
Why's he wearing a bow-tie?
Why's he wearing a bow-tie?
I believe most clowns wear them
I bet he doesn't factor the amount of effort filling out forms etc. into his 'savings'
Hmmm...
If opening multiple cards is a hit on your credit file, then is closing them a positive influence?
Is having multiple cards that are never in default with no late payments that bad?
How long until things improve on your credit history?
Across all my cards, my credit limit is quite large, but I never pay late and just have revolving BT's @ 0% and the cash sitting in offset against home loan. I guess the savings are not that great @ 4.94%. But if we had 8-10% interest rates, the savings would be much greater.
I did it more as an experiment and definitely can relate to the whole 'not enough benefit vs. effort in maintaining it'. I think this is the last round that I'm going to do it.
If opening multiple cards is a hit on your credit file, then is closing them a positive influence?
Is having multiple cards that are never in default with no late payments that bad?
How long until things improve on your credit history?
Across all my cards, my credit limit is quite large, but I never pay late and just have revolving BT's @ 0% and the cash sitting in offset against home loan. I guess the savings are not that great @ 4.94%. But if we had 8-10% interest rates, the savings would be much greater.
I did it more as an experiment and definitely can relate to the whole 'not enough benefit vs. effort in maintaining it'. I think this is the last round that I'm going to do it.
Every credit inquiry is counted as a negative hit upon your file - especially in the case of unsecured debt. The credit file does not provide information on conduct or whether the account is closed - so there is no positive outcome possible.
The easiest way to think of your credit file is to imagine being at 100%. Every time you apply for any form of credit a hit is made, and you drop down a few pegs. After successive hits from rolling debt over you'll find your credit file will quickly start looking quite sick.
You can subscribe to Veda for $89 a year and this will give you credit report every quarter. This also includes a monthly update regarding your credit score. This score can give you a pretty good idea of your credit file's risk ranking.
You can read more here:
http://www.veda.com.au/yourcreditandidentity/check/credit-file
Hi Fenix,
Go ahead and do it! I've been doing this for years and gotten quite a lot of leverage this way.
The trick is on the discipline side, I did miss the payment date once or twice, but its OK, I called and its OK. I made better relationships with some of the banks as my credit history with them is positive and they know I'm a good paymaster. Some banks don't even bother to check my credit score anymore.
So firstly, underatand how credit score works in your country, i cant imagine it being any different from where I am.
Secondly, start a spreadsheet to keep track of your payment dates and amount ( I set it to scheduled on the bank account).
Thirdly and most importantly keep track of the payment and be VERY disciplined.
Hey 1% saved is 1% gained...!
Years later these 1%s could do a lot and those financial discipline you picked up wouldbe tremendous help to your financial freedom.
This double edged sword held in the right hands is a good tool to have.
Keep going!
Go ahead and do it! I've been doing this for years and gotten quite a lot of leverage this way.
The trick is on the discipline side, I did miss the payment date once or twice, but its OK, I called and its OK. I made better relationships with some of the banks as my credit history with them is positive and they know I'm a good paymaster. Some banks don't even bother to check my credit score anymore.
So firstly, underatand how credit score works in your country, i cant imagine it being any different from where I am.
Secondly, start a spreadsheet to keep track of your payment dates and amount ( I set it to scheduled on the bank account).
Thirdly and most importantly keep track of the payment and be VERY disciplined.
Hey 1% saved is 1% gained...!
Years later these 1%s could do a lot and those financial discipline you picked up wouldbe tremendous help to your financial freedom.
This double edged sword held in the right hands is a good tool to have.
Keep going!
It's often too much hassle to chase the best account. I tend to stick to one that gives a good return, and if another is 20 basis points better I'd like it but usually don't bother.
If you are prepared to wait for a week or two, Veda and Dunn & Bradstreet will send the report for free. Part of the credit score is based on how long you have been on file, so applying for a credit file at a young age is indicated.
If you are prepared to wait for a week or two, Veda and Dunn & Bradstreet will send the report for free. Part of the credit score is based on how long you have been on file, so applying for a credit file at a young age is indicated.
I've done it few times when I needed it... opened new cc, transferred balanced (mostly when renovating house or going on Europe holidays), once I pay off balance I close that new credit card. I am disciplined yes, not as much to save, but to pay off debt so for me it worked great and I never paid any interest fee....
And now, how good or bad my credit record is I have no idea
And now, how good or bad my credit record is I have no idea
i don't do it to save money but i do it for getting more frequent flyer deals. So essentially saving 20-30k per year on flights.
