When you save for things instead of just buying them, you: - avoid buyer’s remorse OR realize you really do want the thing, AND can find a better deal.
As an aside, Alayna said that RC Willey is not a furniture store, they’re a finance company. They make more money on financing than they do on furniture.
The ONLY things that you should finance are: a house, a car, school.
If you have debt, the first thing you need to do is get it paid off.
If you don’t change your habits, nothing will change. You will always have debt.
Okay, this was kind of interesting. There’s a guy in our class who used to work for a company that calculates people’s credit scores, and he said that the way that it works is, credit companies take random snapshots of your accounts. They like you to be carrying a balance of 40-60%. If you have a balance over 70%, it hurts your credit. (So, that has nothing to do with whether or not you pay credit cards in full when you get the statement or not, but just that you’re using the card and not dangerously.)
All of your debt should not be over 45% of your income, and really it should be under 35%.
Alayna’s husband worked for American Express before they got married. He was making like $18-19,000/year, and they offered him either a 5% merit increase or they would pay him 5%. He always thought he wouldn’t work there very long, and he ended up working there 5 years. Even though when he left he was still only making like $18-19,000/year, he had over $10,000 in his 401K when he quit. The moral of the story is, if your company offers a 401K program, a lot of times companies will match what you put into it, and you should take advantage of this as much as you possibly can.