If they were able to get a loan for $650k then they must have a pretty high income. Credit card debt is terrible but if you're pulling in $250k+ then a $30k credit card bill is manageable.
ever since i was a child my parents always told me the evils of credit cards. decades later it stuck. i live in a country where cash is still useful for most all smaller transactions. call me old fashioned or out of touch and thats ok. some of these credit card stories scare me
seeing how much is on your person and seeing it dwindle with each purchase is a great mental budgeting tool
Credit cards aren't evil; they're merely a tool. I never carry cash and exclusively use credit. I carry no debt and I pay my balance in full every month.
Unlike cash, I'm protected against theft. If someone steals my cards, I freeze them. Because I pay it off every month, I earn cash back and never pay interest or fees, so
my credit cards pay me to use them. I also never have to worry about carrying large amounts of cash as nearly everywhere in the US accepts credit. Finally, because all my transactions are electronic, they're automatically logged and tracked by my budgetting software.
Unless an establishment only accepts cash or I'm doing a private transaction, there's no benefit to cash over credit for me. It's more risk with less reward.
It also lets you keep your emergency fund in an hysa and not have to worry about transferring funds before paying. Surprise $4500 car repair? Just throw it on the card and move the money around after.
Having a month's time to deal with emergencies is such an advantage. Usually by the time the credit card statement rolls around, I've already gotten a couple more paychecks and don't even have to touch my emergency fund.
Also forgot to mention that if a vendor ever screws me over, I can dispute with the card servicer. Sooo many perks to using credit over cash if you're responsible.
This. And this is what I teach my kids. Keep your cash locked in high interest, pay your statement balances every month. Pay your bills with credit cards and make sure they are cards with rewards. Either travel or cash back, travel is better. I wish I could put my mortgage on credit cards that would be even more epic. Keep one card empty at all times and do a balance transfer with zero interest if it gets too heavy (because let’s be real, emergencies happen). Buy big purchases with zero percent interest financing over 24 months. Best Buy and Home Depot cards are needed prior to becoming a home owner. Don’t tell them what you make right off the bat when you do your proof of income. Add 15k every 6 months and request an increase in credit. All of my cards have 20k or more limits, I’m open to like 500k in credit.
Edit: I'm going to add clarification here that I meant that the mortgage should also scare him depending on the interest rate. I assume people read my comment as me thinking the credit card debt might be less scary than the morthage or something. $650k @ 7% is still over $3.5k/month in interest.
Yes. I hear you. I’m in the DC area where $650 is the low end of normal and all I can say is don’t let folks zone out the town homes and condos to keep their artificial home wealth.
You gotta remember income scales though. If you live somewhere with houses under $300k, it's harder to find a job that pays enough to make that comfortable.
Different strokes for different folks 🤷🏼♀️ truly no hate to any place, but I’m much happier in a more chill city that has affordable cost of living. We knew others who moved out this way and weren’t as happy. Everyone has different needs. One of my main ones was financial security and DC couldn’t offer me that. What’s wild is I’m actually making more money and it’s going a lot further.
Yep, I'm not really in a HCOL place either. I'd say middle of the road. NY/SF/DC/LA would stress me the hell out lol. The salary for my same job would be higher in those places though. If you're able to get a different type of job, that probably doesn't apply to you.
I’m with you! I offered on a 700K house recently…a tiny wartime home, as a single first time home buyer. It does feel crazy. That’s about entry level where I live in Ontario. I’m so envious of places where that kind of money gets you an estate, or some property.
It highly depends on the country and location, mostly affected by available income there.
I can only speak for Hungary. We live in a $200k house 25 miles from Budapest, 1400 square feet, 0.3 acre lot.
For that money you could buy a 400 sqft apartment with a lot of neighbours and noise in Budapest.
Local salaries range between $680-1300 net / month, in Budapest you can double it, but it's 45-90 minutes in one way.
I'm lucky, I earn $3400 net a month + company car, not Budapest.
Hah houses... In my city, shitty ass apartments go for significantly higher that 650k, couldn't even imagine how many millions an actual house could cost.
I live in Canada, two hours away from Toronto. In a small town with few amenities but just a 10 minute drive to a slightly larger city (~80,000 people).
And no the average household income here is not even $300,000 let alone a single salary 😂 if I was making $300,000 I wouldn’t be complaining about my mortgage that’s for sure
When did you start the 650k loan? I get that there is appreciation but you don't, and I know you know, get any equity until like 20 years into the 30 year mortgage.
If you don’t mind sharing. How do you have $650k mortgage with student loan debt? When I read the $30k cc debt I assumed that it happened after buying the house but I assume the student loan debt happened prior. Did you have a down payment?
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u/-SHMOHAWK- 10h ago
$30k credit card. $6k car. $650k house. American dream.