Complete lack of credit knowledge

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Battery111
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Complete lack of credit knowledge

Postby Battery111 » Mon Aug 03, 2015 5:33 pm

Ok, I'll qualify this by saying yes I know everyone starts their credit knowledge someplace, and I don't expect everybody to be an expert in credit cards. But today I overheard a conversation where someone who was at least 20 was bragging about how responsible they use credit. They were talking about how for some of their everyday purchases they will select credit rather than debit when using their debit card to boost their score and improve their report. I just didn't even know where to begin with this, and I was only sort of part of the conversation so I chose not to spend the next couple hours explaining basic credit knowledge. But I will somewhat shamefully admit I was amused at the level of ignorance. Anyone else encountered this misconception that selecting credit while using a debit card causes it to report as a credit card before?
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yfan
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Re: Complete lack of credit knowledge

Postby yfan » Mon Aug 03, 2015 7:08 pm

I bet this person has never pulled their credit reports.

Whatamuji
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Re: Complete lack of credit knowledge

Postby Whatamuji » Mon Aug 03, 2015 10:13 pm

Well that takes the cake.
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Kevin86475391
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Re: Complete lack of credit knowledge

Postby Kevin86475391 » Mon Aug 03, 2015 10:28 pm

Battery111 wrote:They were talking about how for some of their everyday purchases they will select credit rather than debit when using their debit card to boost their score and improve their report. I just didn't even know where to begin with this, and I was only sort of part of the conversation so I chose not to spend the next couple hours explaining basic credit knowledge. But I will somewhat shamefully admit I was amused at the level of ignorance.


I haven't heard that one per se, but it doesn't surprise me and honestly seems like a fairly logical conclusion to jump to for someone who just doesn't know how it works and was trying to guess. The truly sad thing IMO isn't this particular person's ignorance, but the fact that it's emblematic of an education system that doesn't teach even the basics in personal finance management. When I was in school I was an A student who went all the way through elementary school, middle school, high school, and college without ONCE having a class that talked about credit scores or what a credit report was. Granted I wasn't a finance or economics major, but this is basic stuff that should be part of the core curriculum for all students.

I know very intelligent, older adults who to this day aren't any more informed about the topic than the young adult in your story. It's not because they can't understand credit or find it confusing. It's just that no one's ever sat them down and given them the information and they've never had the inclination to seek it out on their own.

takeshi
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Re: Complete lack of credit knowledge

Postby takeshi » Tue Aug 04, 2015 8:33 am

Battery111 wrote:I just didn't even know where to begin with this, and I was only sort of part of the conversation so I chose not to spend the next couple hours explaining basic credit knowledge.

Why would you need hours? You could just tell the person to pull his/her own reports and see how that debit card reports.

oldsoldier
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Re: Complete lack of credit knowledge

Postby oldsoldier » Tue Aug 04, 2015 10:16 am

takeshi wrote:Why would you need hours? You could just tell the person to pull his/her own reports and see how that debit card reports.


I say he probably didn't want to end up in a long debate. You know most young folks pretty much think they know it all. I see it everyday with my adult kids.
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Re: Complete lack of credit knowledge

Postby Vermonster » Tue Aug 04, 2015 2:40 pm

If they're confused about using a credit card vs pressing credit when using a debit card, you know there is going to be a lot that needs to be explained.
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kcm7
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Re: Complete lack of credit knowledge

Postby kcm7 » Tue Aug 04, 2015 5:04 pm

Some months back I posted about a conversation I overheard -- where a guy said he was building better credit by always carrying a balance (and paying interest) because it makes the banks happier and causes them to give you a higher credit score.

I figure that, if someone is doing something that hurts only themselves, it shouldn't matter. But when I hear them giving other people advice, I really want to step in.
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Battery111
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Re: Complete lack of credit knowledge

Postby Battery111 » Tue Aug 04, 2015 5:28 pm

This was actually something he mentioned after pulling his credit reports for the first time. He just didn't get it. Thing is, it was a finance class, and he was saying this to the instructor during a break period and the instructor didn't correct him. At that point my options were to just quietly shake my head, or take over teaching the class myself which really wasn't an option in the forum we were in.

Like I said, I'm not trying to make fun per se. I just thought it served as an indicator about how wildly varied everyone's credit knowledge is. When I see sites or classes that emphasize needing to pay your bills by the due date, I think to myself does that really need to be said? Apparently it does.
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Re: Complete lack of credit knowledge

Postby Gamma » Tue Aug 04, 2015 7:38 pm

kcm7 wrote:Some months back I posted about a conversation I overheard -- where a guy said he was building better credit by always carrying a balance (and paying interest) because it makes the banks happier and causes them to give you a higher credit score.

I figure that, if someone is doing something that hurts only themselves, it shouldn't matter. But when I hear them giving other people advice, I really want to step in.

I remember that thread. I agree with what most people said and I'd keep my mouth shut, even if they're giving false information to a stranger. Only time I'd give info would be to friends or known associates if they ask for advise.

Also regarding the guy choosing credit with their debit card, I thought most pos would reject credit tender if it reads it as a debit card. I remember one instance where an old guy was trying to choose credit with his debit card and the pos machine rejected it.



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