Savvy or Stupid: Should I put my credit cards on ice?

From the Community…

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  Posted by Caitie Wed Apr 29, 2009 8:34am PDT

  I keep mine in a box out of my reach. Out of sight out of mind. If I have to get a chair to get my cards down then sort through them (I keep gift cards, credit old licenses, and hold hotel cards together) do I really need though shoes?

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  Posted by springtime Wed Apr 29, 2009 9:29am PDT

  I'm so sorry the Cookie Monster didn't win. See there. That just proves life is not fair. I may never get over this.

  I have three credit cards. Many times when I go out, I do not carry them. It just comes down to self discipline.

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  Posted by opiniononly Wed Apr 29, 2009 12:03pm PDT

  If you can't control your spending habits and freezing your cards helps, then do it. They can be thawed out but don't melt them in the microwave. The swipe strip will arc out the 'wave and you'll have to find another charge card in order to charge the new one.

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  Posted by fools_and_sages Thu Apr 30, 2009 8:17am PDT

  Oddly, not using your credit cards does lower your credit score. Mine was 803 last year at this time. Then I started a job late last summer that allows me to avoid using the cards completely or allows me to pay them off in full each month. Now my score is 735.

  Loan agents claim that your debt credit to ratio (how much you owe versus the grand total of the credit limits on all your cards) needs to be low to have a high score. But. . when you have a high total credit limit and you owe nothing, I'm not sure how that can adversely affect your credit score.

  Example: Your total credit limit is $30,000 when you add up all the limits on all your cards. You actually owe $3000. That means your debt to credit ratio is 10%. . meaning you have used 10% of your available credit.

  Last time I checked, owing $0 on your cards and having a $30,000 total credit limit means you have used 0% of your credit. And, in my world, ZERO is LESS THAN 10, which means my debt to credit ratio is as low as it can get. If having a low debt to credit ratio keeps your credit score high, how can having NO BALANCES your cards LOWER your credit score?? You can't get lower than ZERO when it comes to money. It makes no sense.

  If Obama really wants financial institutions to lend money more responsibly and stop preying on consumers, then reform needs to occur in the credit markets. The current system penalizes financially responsible people and rewards those who have middle of the road card balances and make their payments on time. In the real world, having no debt means you can be relied upon to pay off what you owe. In the banking world as it exists right now, building debt and keeping up with the minimal payments equates to reliability. The banking industry creates economic instability with this philosophy because, when good paying jobs disappear (or most jobs disappear) and people can't make those payments, the system collapses.

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  Posted by Shelby P Thu Apr 30, 2009 8:19am PDT

  I use a variety of free work at home companies. I’ve cleared over 14k in the last year, it’s not a way to get rich, but you can avoid retail/fast food jobs by doing it or make extra money to pay bills. You can see what I’m doing at http://www.freewebs.com/free2workathome/ if you’re interested

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  Posted by Michelle C Thu Apr 30, 2009 9:55am PDT

  Yeah but keep in mind credit card companies are closing accountd or lowering limits on accounts that aren't used often enough also, so experts are advising using each card at least every 3-6 months. Doesn't anyone read or watch the news - this is OLD news.

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  Posted by Kimber Thu Apr 30, 2009 10:40am PDT

  I freeze my cards, and they are fine after they thaw. Leave them on the counter to thaw and the spending urge does tend to be gone by the time the card is ready to be removed. I have no self control when it comes to impulse shopping, so this really helps me out.

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  Posted by fools_and_sages Thu Apr 30, 2009 1:11pm PDT

  I do use each one a couple times a year. But it's the while idea that you HAVE to. It's stupid.

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  Posted by jessicaw Thu Apr 30, 2009 2:29pm PDT

  I have actually done this. I am not like most people. I am like you! It does help, they still work if you really need them (once it defrosts). I would do it, I have to refreeze mine tonight.

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