LPT: Stop Paying Credit Card Interest.

This advice is really over simplistic. Because it overlooks the fact that you don't know what you can afford.

Here's my example. I was working as a retail manager making $15.50/hr in 2010. Things were going well with my girlfriend so I proposed. We got married. I got sick of throwing my money away paying rent instead of building equity. So we bought a house. I specifically chose one about a mile from the store I was working at. Six months later the store closed down and I had to find other work. To add a nice wrinkle my wife found out we were going to have our first kid right around the time I learned I was going to be a dad. So I get this other job. It was 25 minutes away so already I was burning way more gas than I would have at my old job. Additionally it paid a little lower but I took the job because I needed actual income and not the small sum of money that unemployment was giving me. The plus side was tgat tge new job was about 20 minutes from my in laws so once the kid came we had free child care service. Things were going okay but then my car broke down. So I shelled out $700 to rework something on the transmission (before I did I made sure that fixing the car was in our best interest by comparing blue book values etc.). I had to put that on credit because we were still paying the hospital bills and I didn't have any real savings to fall back on because I used that to make the down payment for the house. Things were going well again and even though I didn't have the cash flow to pay off the whole $700 at once I was paying more than tge minimum and I was okay with it just noting to myself that it wasn't ideal but it was not the end if the world to carry a little credit card debt. Then the car had an issue with the idle air control valve. That cost $300 which because it was unrelated to the previous problem meant that it was still better to fix than get a new car. So we did. We couldn't pay that off either so that was a little more credit card debt. Still no big deal. Then my work announced that we were moving our base of operation a few cities over. Which meant my daily commute got about 40 minutes longer because I now has to drop my kid off with my in laws and then drive to my work and then go pick them up at the end of the day. So that was more gas money. Right after we moved to the new shop I find out we're expecting another kid. Then the car breaks down again and this time it makes more sense to replace. We get the car. Then my wife has the kid she comes down with postpartum depression and up and quits her job.

So here I am. I've got a house. A spouse, two kids both in diapers, a car payment, and all the bills and need to provide food, clothing. I know I should pay off the credit card in full every month but how is that actually going to happen?

I'm not complaining about my life. I'm actually one of the most frugal people I know. I almost never eat out. I only drink water. I haven't paid to see a movie or any event in about 10 years and I drive the most fuel efficient car I can afford. I've even taking to grocery shopping with a spreadsheet do I can figure out what the best deal is with coupons and alsi to give me an after tax total so I can see if I can put it on debit or if I need to throw it on credit.

I think for a lot of people this is sound advice but my guess is there are a LOT of people who know how they should use credit cards who aren't using them right because at this particular juncture of their lives it might make more sense to carry some credit card debt than for example defaulting on a large loan or not repairing something like their only mode of transport.

Lastly I plan on being out of debt by this time next year. I know I can do it and then the first thing I will do is make sure I use my credit card correctly.

/r/personalfinance Thread