to up mine I have to take loans out and pay them off instead of just never taking a loan out... What the fuck lmao
Yep, credit score isn't a measure of how thrifty you are, it's a measure of how milkable you are as a debtor. High credit scores mean you've been taking on lots of debt through credit cards, home loans, student debt, etc for a very long time without missing a payment. A cow that never produces milk is only good dead, that's the neoliberal way.
That's not exactly true. You can take out a credit card and pay off the balance in full every month, avoiding interest and fees, and you'll still have a good credit score.
Credit score is more of a disciplinary tool. It's the same purpose as China's spooky "social credit" system.
Yeah as long as you don't miss payments (whether paying minimum or full, it doesn't matter), then your credit score goes up, and lenders see you as "low risk". They care more about getting their money back on their own terms than they do about milking you specifically for interest, they will always have ways of generating revenue.
Well yeah you can, but paying off your balance every month doesn't necessarily mean you don't make the credit card company money. Read this section on the topic of deadbeats:
Because credit card companies still earn money from deadbeats. One way they make money is that merchants pay about 3% of each credit card transaction in fees to the credit card company.
There's also the matter of annual fees and other services.
The credit card fees are baked in. You pay for them anyway, might as well get a credit card with rewards to get something back. It's like saying that there's no reason to use coupons because the store makes money anyway!
There's also no reason to get a card with a monthly fee. Bad financial advice is another form of poor tax. I know people mean well, but if you want finance tips, look at what rich people do. They fucking use credit cards and pay them off so that they can get that cash back!
That's not exactly true either. In order to be issued a credit card without sufficient credit, you need to pay a security deposit to the creditor. This deposit acts like an interest free loan. Those of us that have no credit or bad credit and are poor don't have access to that method.
All the downsides that apply to normal banks really. Credit Unions are slightly more member/customer friendly, perhaps less punitive fees and rates, but they exist within a capitalist framework & function as capitalist entities.
Somebody check me if i went too ultra.
Looking into a local credit union a while ago and the biggest downside was that it seemed like most ATM's wouldn't play nice with them.
Could keep most of your cash savings and things like certificates of deposit (had way better rates than non Credit Union options) in the Credit Union and have a small checking account you keep fed from the Credit Union account so that you can have a cash card that works in more places.
Just opening a credit card will improve your score, just have your subscriptions and bills on it, and then pay the statement balance at the end of the month. No interest charged or anything, and no need to actually take out a loan.
If you don't have a credit card already, you can ask about options at your bank or credit union like other posters said. If you have a short credit history, then Discover It is a good place to start, just apply online.
If you have no or bad history, then get a "secured card". You pay the bank a couple hundred bucks or something as collateral, and you get that amount as your "credit line". After you've shown that you can pay the bill on time for 3-6 months, you can usually upgrade it to a standard card (and get your money back). Of course, many people can't afford to leave a couple hundred bucks sitting around for so long, so it has its issues, to say the least. A final alternative is to have someone cosign on a card, which basically means that they are equally liable for whatever happens with the card. You get all the benefits of the card, but your cosigner is trusting you to not fuck up or screw them over, so it's not ideal unless it's like a spouse or something imo.
Good credit takes around 3-5 years to build if you're starting from nothing, great credit takes 6-8 years, so it's worth opening lines of credit as soon as possible (and not really using them, of course). As long as you don't miss a payment, banks will offer accounts with almost-decent interest rates and increasingly higher credit lines that you can use in an emergency situation.
Pro tip: if you have good enough credit score for a line of credit, they have a much lower interest rate. Set your line of credit to be the same account as your chequing account, that way you can go into the red and it pays itself off as your paycheques come in, and your credit score can increase without you even really trying or paying attention.
