Interest Free Financing

[Fred Coulter]

I wish I could spring for a keyboard right now, but I may be getting an AGO pedal board this summer. So I'm avoiding annoying my wife more than I need to. But if you're in the market, Sweetwater is offering 36 month and 48 month interest free financing on select manufacturers items.

If Korg was on the 48 month list, there'd be a Kronos 88 being shipped to my house right now.

REMINDER: Do not finance something that you won't be able to pay for. Once you've financed it, set up automatic payments through your bank's web site to pay it off on schedule without interest. Don't rely on getting bills and mailing payments. If anything goes wrong, you'll be facing very large interest payments and your credit rating will suck.

 

[happyrat1]

If you don't mind my asking, since this is the second time you've brought up financing a board, have you ever gotten in over your head credit wise in the past Fred?

While the Sweetwater offer may seem like a good deal to you in the US, in other countries it probably doesn't apply and since this is an international forum most of us couldn't use it if we wanted to.

Anyway, I have decent credit and an unsecured low interest line of credit with my bank but generally speaking, as a rule I never purchase anything with my credit card that I can't afford to pay off at the end of the month.

I financed my Kurzweil a few years back because it was worth almost as much as my vehicle, but even so I made every effort to pay it off within 6 months. It ended up costing me well below $60 in interest.

My advice to anyone out there who has problems with credit is to not use it at all or else take a personal finance course at a community college to learn how much credit cards with a high %age APR REALLY costs them in the long run.

Write up a budget and stick to it and avoid making large impulse purchases if you don't have enough in savings to cover the cost if the unexpected should happen and you lose your primary source of income.

Gary

 

[Fred Coulter]

I've dug myself out of a major credit hole over the past few years. At this point, the only things we owe (other than mortgage, car, student loans, and interest free stuff) are the monthly time shift credit card bills. Probably reduced debt by close to $100K. (And none of it on musical instruments. Sad.) Why the monthly time shift cards? Frequent flyer miles. (A time shift credit card is a credit card that you pay off in it's entirely at the end of the month. Full payment = no interest. We could pay the bills with a debit card, but then there would be no miles. And we would make a couple pennies less in interest.)

Why frequent flyer miles? My daughter wants to sing opera. The market is much better in Europe. So there's a strong probability that I'll be flying over occasionally. If I can avoid paying for that airfare...

Student loans in the United States are a special case. Unlike the people screaming about the evils of student loan debt, I consider it the last debt to get rid of. The interest rates are very low, and your payments are capped by your income. If you make the payments for twenty five years the debt is gone EVEN IF YOU STILL OWE MONEY. So when your philosophy degree from an Ivy college doesn't result in a great paying job -- well, at least you don't have to follow in Socrates footsteps -- after making payments that may not even pay the interest for twenty five years, it's gone.

But you're right that this only works in the United States. (I supposed that if you had relatives who trusted you a great deal you could work something out. But I've heard that borrowing money from relatives can be extremely dangerous.)

 

[happyrat1]

It all boils down to how you were raised I suppose.

My father taught me at an early age to avoid lawyers at all costs and to never buy anything on credit that I wasn't able to pay back.

I always took that advice to heart from day one.

My basic feeling is that people who get into trouble with credit simply don't understand math. Compound double digit interest rates are simply insane and border on loansharking. How the government allows them on credit cards at today's prime interest rates is painfully stupid.

Gary

 

[musicstand]

If you do not have the money to buy the greatest and latest "what-sha-ma-callit", then do not subject yourself to the never ending parade of temptations from TV ads or newspapers. Never a borrower or a lender be. Jim.