Growing up I believed credit cards were the devil. No seriously, I thought credit cards were evil. My father was anti-credit and my mother was pro-credit. My mother was charging it, while my father was an if you can't afford it don't buy it type of man. So, initially I adapted my fathers mindset toward credit.
Then I turned 18, I applied for a credit card at my favorite store, Express. They gave me a $1,000 limit. Keep in mind I had no income, well I did have a summer internship. So, I took the Express credit card because of the discount but I paid the bill off in full immediately. Then it was time for me to go off to college, my father said, DO NOT GET ANY CREDIT CARDS. Well, that all sounded good however on campus, they had representatives offering credit cards for free t-shirts. Now I had savings, some investments at the time and my mother was giving me about $300/month allowance.
What does that mean? I applied for credit cards, by the time I was finished with college I had 7 credit cards all maxed out and in default! When I graduated my credit score was in the toilet. I decided to take charge and I joined a debt management program. It took me about 4 years but I completed the program. 4 years to pay off clothing and other things that had no value and brought no value to my life. 4 years paying off liabilities I was no longer benefiting from.
Now, I have 3 credit cards I didn't max them out but I made some unwise decisions in my past. Last year I did the Savings Challenge we posted a couple of weeks ago, and I began 2014 by paying off 1 of my credit cards. I then applied for a new credit card that offers 0% interest for transfer balances, so I transferred the balance on my 2nd card and that will save me money as I'm not paying interest.
At the end of 2013 however, I learned a different way to look at credit cards. I learned to look at credit cards as Other People's Money. Instead of calling it a credit card, I now call it an investor card and I understand the value of my investor card. I also understand the value of having huge credit limits coupled with discipline.
The moral of this story, credit cards are not the devil. My parents both understood the concept of credit they just didn't know how to combine their efforts and use their investor cards wisely. Now that I've attended a seminar and learned from the wealthy. I realize both of my parents were right in a sense they just needed more financial literacy to understand how to use credit cards to their benefit.
My credit score is now over 700! Understand we need credit, we need to establish credit history and credit worthiness in order to obtain loans for certain things and receive great interest rates. Now, if you have a lot of capital and assets you don't need credit. Nevertheless, until you build up to that point, you need credit. You need to protect your credit score, use credit wisely, and treat them as investor cards.
Haven't checked your credit report lately? Don't Know Your Credit Score? Visit http://www.annualcreditreport.com pull 1 report every 3 to 4 months from each bereau, check for any errors and have them removed immediately!
If you would like to learn more about how you can become financially free and on the road to discipline, wealth, and multiple streams of income, contact us. We have a Free Wealth Building Mastermind coming soon. Stay connected on social media and join our mailing list.
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