Don’t Finance Furniture And These Other 6 Items

Don’t Finance Furniture, Skip Wedding Debt, And More

Don’t Finance Furniture, Skip Wedding Debt, And MoreOh, credit cards. You either love them or you hate them.

For me, I love them. I love the credit card rewards that come along with responsible credit card usage.

However, I know I’m not the norm.

I’ve seen the mess that credit cards have brought upon others, so I know that not everyone feels the same way as I do.

Irresponsible credit card usage can lead to high interest charges, late fees, and a ruined credit score.

It can also lead to a person spending much more money than they originally planned for. By signing up for financing or paying for a purchase with a credit card, it may make the item seem more “affordable” due to the fact that you aren’t paying for it with money that you already have.

Just because the monthly payment seems “doable,” it doesn’t mean that it’s what’s best for you. Debt can lead to stress, a paycheck to paycheck lifestyle, delayed retirement, and more.

These are all things that no one wants, especially if there are other ways around it!

Side note: Of course, there are always exceptions to the rule. If you know how to take advantage of certain financing offers then you may be able to come out ahead. However, if you know that you are not good at handling credit cards and debt, then it may be best to avoid them completely and to not finance the items that I have listed in this blog post.

Below are several items you should never finance or put on a credit card unless you are 100% positive that you can pay them off in full before any interest charges or fees accrue.

1. Furniture.

Earlier this year we bought a few new furniture pieces after we moved to Colorado. The salesman kept saying that we could just finance everything and then we wouldn’t have to feel the pain of spending money all at once.

This is a horrible idea! Furniture can be quite expensive and it can be very easy to have a large bill after leaving a furniture store. No matter how enticing those furniture financing offers may be, please remember that you will have to pay for the FULL cost eventually. Too many get caught up when they think about the monthly payments, but it’s the full cost that is important.

If you don’t believe me when I say that financing furniture is a bad idea, read more about it on my friend Lance’s blog post Financing Furniture At 0% Is For Suckers.

2. Wedding expenses.

Having a wedding can be fun, but it is not worth it to start out your life with your new spouse in debt. Wedding debt can cause arguments, stress, financial problems, and more.

Weddings can be expensive or they can be affordable. A wedding can be done on any budget, no matter how low your budget may be. Remember, you can get married just for the cost of a marriage license!

Related: How To Save Thousands On An Engagement Ring

3. Medical bills.

Medical bills are something that no one wants to experience. However, they do happen. Before you resort to putting your medical bills on a credit card, you should contact the hospital and see if you can receive any applicable discounts for paying in cash. Then, ask if you can be placed on a payment plan through the hospital.

Yes, that means that you will still have a monthly payment. However, your interest rate is most likely going to be much lower when paying the hospital directly rather than paying the high interest rate that your credit card charges.

4. Vacations.

I bring this true story up a lot, but it is one that still shocks me every time I think about it. I know someone who uses their student loans to pay for vacations and they have even bought a few timeshares with their student loans as well.

This is a horrible idea!

A vacation is supposed to be that – a vacation. I couldn’t imagine that a vacation would be relaxing at all if you were paying interest on it for months or years to come.

There are many ways to have an affordable vacation without any debt. I recommend checking out my post How To Save Money On Hotels And Go On More Vacations for more information.

Related: How To Get Rid Of A Timeshare – Stop Wasting Your Money!

5. College costs.

Recently, someone approached me and asked if they should put their college tuition on a credit card or if they should apply for student loans.

The credit card had an interest rate of around 20%, so you can only imagine how shocked I was when the college’s financial office was actually recommending this.

Before you put any college expenses on a credit card, you should think about how much that large interest rate is going to impact you. Plus, your college will most likely charge you a fee for putting college costs onto a credit card as well (such as 2% or 3%), which can quickly add up as well.

Related: How I Paid Off $40,000 In Student Loans In 7 Months

6. Clothing.

Numerous clothing stores now offer credit cards. They lure you in with a free item, $25 off, 5% off, or something else that is relatively small.

If you are not good with credit cards, please ignore these offers! The small reward you may receive is not worth the trouble.

Clothing never needs to be financed. If you’re desperate, you could always visit a thrift store for the items you need. However, I don’t know of many instances where a person would be so desperate for clothing that they would need the debt that goes along with it.

7. Down payments.

If you can’t pay for a down payment upfront, you most definitely do not want to put it on a credit card with a high interest rate.

This is due to the fact that you will have to pay for interest charges for months or years to come. It most likely will not make whatever you are paying for worth it if you are paying an extremely high interest rate.

It’s much better to save up cash for the down payment that you are needing.

What do you think of financing the above items with a credit card? What else should a person never finance?

Related Posts

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Source: makingsenseofcents.com

7 Expenses To Never Put On A Credit Card

Don’t Finance Furniture, Skip Wedding Debt, And More

Don’t Finance Furniture, Skip Wedding Debt, And MoreOh, credit cards. You either love them or you hate them.

For me, I love them. I love the credit card rewards that come along with responsible credit card usage.

However, I know I’m not the norm.

I’ve seen the mess that credit cards have brought upon others, so I know that not everyone feels the same way as I do.

Irresponsible credit card usage can lead to high interest charges, late fees, and a ruined credit score.

It can also lead to a person spending much more money than they originally planned for. By signing up for financing or paying for a purchase with a credit card, it may make the item seem more “affordable” due to the fact that you aren’t paying for it with money that you already have.

Just because the monthly payment seems “doable,” it doesn’t mean that it’s what’s best for you. Debt can lead to stress, a paycheck to paycheck lifestyle, delayed retirement, and more.

These are all things that no one wants, especially if there are other ways around it!

Side note: Of course, there are always exceptions to the rule. If you know how to take advantage of certain financing offers then you may be able to come out ahead. However, if you know that you are not good at handling credit cards and debt, then it may be best to avoid them completely and to not finance the items that I have listed in this blog post.

Below are several items you should never finance or put on a credit card unless you are 100% positive that you can pay them off in full before any interest charges or fees accrue.

1. Furniture.

Earlier this year we bought a few new furniture pieces after we moved to Colorado. The salesman kept saying that we could just finance everything and then we wouldn’t have to feel the pain of spending money all at once.

This is a horrible idea! Furniture can be quite expensive and it can be very easy to have a large bill after leaving a furniture store. No matter how enticing those furniture financing offers may be, please remember that you will have to pay for the FULL cost eventually. Too many get caught up when they think about the monthly payments, but it’s the full cost that is important.

If you don’t believe me when I say that financing furniture is a bad idea, read more about it on my friend Lance’s blog post Financing Furniture At 0% Is For Suckers.

2. Wedding expenses.

Having a wedding can be fun, but it is not worth it to start out your life with your new spouse in debt. Wedding debt can cause arguments, stress, financial problems, and more.

Weddings can be expensive or they can be affordable. A wedding can be done on any budget, no matter how low your budget may be. Remember, you can get married just for the cost of a marriage license!

Related: How To Save Thousands On An Engagement Ring

3. Medical bills.

Medical bills are something that no one wants to experience. However, they do happen. Before you resort to putting your medical bills on a credit card, you should contact the hospital and see if you can receive any applicable discounts for paying in cash. Then, ask if you can be placed on a payment plan through the hospital.

Yes, that means that you will still have a monthly payment. However, your interest rate is most likely going to be much lower when paying the hospital directly rather than paying the high interest rate that your credit card charges.

4. Vacations.

I bring this true story up a lot, but it is one that still shocks me every time I think about it. I know someone who uses their student loans to pay for vacations and they have even bought a few timeshares with their student loans as well.

This is a horrible idea!

A vacation is supposed to be that – a vacation. I couldn’t imagine that a vacation would be relaxing at all if you were paying interest on it for months or years to come.

There are many ways to have an affordable vacation without any debt. I recommend checking out my post How To Save Money On Hotels And Go On More Vacations for more information.

Related: How To Get Rid Of A Timeshare – Stop Wasting Your Money!

5. College costs.

Recently, someone approached me and asked if they should put their college tuition on a credit card or if they should apply for student loans.

The credit card had an interest rate of around 20%, so you can only imagine how shocked I was when the college’s financial office was actually recommending this.

Before you put any college expenses on a credit card, you should think about how much that large interest rate is going to impact you. Plus, your college will most likely charge you a fee for putting college costs onto a credit card as well (such as 2% or 3%), which can quickly add up as well.

Related: How I Paid Off $40,000 In Student Loans In 7 Months

6. Clothing.

Numerous clothing stores now offer credit cards. They lure you in with a free item, $25 off, 5% off, or something else that is relatively small.

If you are not good with credit cards, please ignore these offers! The small reward you may receive is not worth the trouble.

Clothing never needs to be financed. If you’re desperate, you could always visit a thrift store for the items you need. However, I don’t know of many instances where a person would be so desperate for clothing that they would need the debt that goes along with it.

7. Down payments.

If you can’t pay for a down payment upfront, you most definitely do not want to put it on a credit card with a high interest rate.

This is due to the fact that you will have to pay for interest charges for months or years to come. It most likely will not make whatever you are paying for worth it if you are paying an extremely high interest rate.

It’s much better to save up cash for the down payment that you are needing.

What do you think of financing the above items with a credit card? What else should a person never finance?

Related Posts

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Source: makingsenseofcents.com

Is Financing Furniture A Good Idea? Skip The Home Furniture Payment

Offers for financing furniture are everywhere these days. You’ll see commercials on TV, offers in stores, signs on streets, and more.

Financing furniture is usually a bad idea. Having a home furniture payment through furniture financing is bad news as it can wreck your finances! Having a home makeover doesn't have to make you broke - you can DIY a living room, find affordable ideas, and more!

Financing furniture is usually a bad idea. Having a home furniture payment through furniture financing is bad news as it can wreck your finances! Having a home makeover doesn't have to make you broke - you can DIY a living room, find affordable ideas, and more!I see them all the time, and I can’t believe the “deals” they are promising people.

To be honest, I have never once seen a good deal on furniture financing.

I’ve seen offers for bed frames at $100 a week for a year, computers at $50 a week for a year, and so on. The low monthly payment is what pulls people in, but when you think about how long you will be making that payment, financing furniture and electronics becomes pretty unrealistic.

Side note: Of course, there are always exceptions when it comes to financing and credit. If you know how to take advantage of certain financing offers, then you may be able to come out ahead. However, if you know that you are not good at handling debt (which is probably the majority of the population), then it may be best to avoid offers like this completely.

When we were looking at furniture a few years ago (before we moved into an RV), the salesman kept telling us that we could just finance everything and wouldn’t have to feel the pain of spending so much money all at once.

The finance blogger in me probably should have slapped him because that is such a horrible suggestion.

Furniture can be quite expensive, and it can be very easy to walk out of a furniture store with a huge bill. However, no matter how enticing those financing offers may be, please remember that you will eventually have to pay the FULL cost.

Too many people get caught up when they think about the monthly payments, but it’s the full cost that is important.

Related: The Danger Of Normalizing Your Debt – Stop Living Like Everyone Else

Here is why you should stop financing furniture.

You’ll pay more for furniture if you finance it.

There’s a reason why companies push financing furniture. They know that the average person will spend more money on furniture if they can have it financed.

Furniture stores know that the average person will be more inclined to buy furniture if it’s $100 per month, instead of $2,000 upfront. However, that’s a bad way to think about spending money, as it just leads to debt!

Financing furniture can also lead to spending much more than you originally planned for. By signing up for financing or paying for a purchase with a credit card, it may make the item seem more “affordable.” But, not having the money to pay for it up front is the opposite of affordable.

Even if you can afford that monthly payment, it doesn’t mean financing furniture is the best idea. Financing furniture can lead to stress, a paycheck to paycheck lifestyle, delayed retirement, and more. No one wants to experience these things.

If you can’t afford the furniture in cash, then you definitely should not be financing it.

It’s just furniture. And, it will lose the majority of it’s value the moment you put it into your home.

Related: 15 Reasons You’re Broke And Can’t Save Money

Furniture can be very overpriced.

Furniture stores that provide financing or rent-to-own options usually have overpriced furniture.

Because of the deals they offer, like the ones mentioned at the beginning of this article, the price is often inflated to three or four times more than the actual price if you would have paid for it with cash.

The low payment is what gets people, but when you think about how long you will have that payment for, it almost always means you’ll be spending a crazy amount more.

I mean, why would someone pay $3,000 for a $500 computer?

It just doesn’t make any sense!

Please think about the full cost of those monthly payments, and compare that total with what it would cost to buy that item upfront. That alone will probably make you want to run away from any financing furniture “deals” that you come across.

Related content: Everything You Need To Know About How To Build Credit

If debt is the only way, then you can’t afford it.

The average person has a lot of debt– in fact, the average U.S. household has over $10,000 in credit card debt alone. There are loans for everything, and sadly, many only look at the monthly payment to determine whether or not they can make their purchase.

Some look to debt as a way of affording things for the rest of their lives. Instead of being more realistic with their finances, many people even “budget” debt well into their future.

Debt should not be normal. Just think about what life would be like if everyone was living debt free? What if we only purchased things we could afford? And, if we did need to take on debt, what if we were more selective and careful when doing so?

You shouldn’t have the mindset that debt is a normal part of life. Normalizing debt can lead to thinking it’s okay to use debt to pay for everything instead of focusing on living debt free.

You should make sure that you can actually afford the purchases you are making and not by just looking at the monthly payment. You should make sure you are fully analyzing your purchases, differentiating between wants and needs, and budgeting more realistically.

If the only way you can afford furniture is to finance it, then you can’t afford it.

It’s really that simple.

Related: How To Make Extra Money in 2017

Financing furniture may prevent you from reaching other goals.

A monthly furniture payment can add a lot of financial stress to your life. The amount of happiness you get from purchasing furniture can never match the amount of hardship brought on by debt.

I’ve never heard a person say “I’m so glad I have furniture debt because this furniture is so nice.”

Usually, it’s the exact opposite.

Financing furniture can cause a person to:

  • Have lots of regret
  • Not reach retirement
  • Stress about keeping up with others
  • Stress over paying bills

And so on!

Living debt free means that you are in control of the life you want. On the other hand, a furniture payment can’t bring that kind of control or happiness.

You may miss a payment and pay hefty costs.

While you might think that you’ll never miss a payment, it could happen. Even if you think that you’ll always have the money to make your payment, it is always possible that you miss it for one reason or another, such as just forgetting to schedule it.

Missing one payment isn’t hard to do. Many furniture companies require payments once a week, so you will be looking at something like 52 payments for a standard furniture loan. That’s a lot of payments to remember to make!

While you may think that missing a payment isn’t a big deal, many furniture financing deals have consequences if you miss just one payment.

You may have to pay a large penalty, interest charges, and more.

If you are thinking about financing, you will definitely want to read the terms and conditions of the loan. Many times their terms require you to pay interest charges for the WHOLE loan (starting from day 1), for just missing one payment. So, even if you are on a 0% financing plan, you may be required to pay the real interest rate (which may be 20% or more!) for the whole life of the loan, even if you are on one of the very last payments.

That 0% interest rate may not look so good now.

This is something that many people aren’t aware of, and it can completely destroy your finances!

You don’t need unaffordable furniture.

Some items are needs, but many of the things we buy are just wants. If you don’t realize the difference between your wants and needs, you may feel like you have to take on debt to fund your lifestyle.

To me, financing furniture is a want. It definitely isn’t something anyone needs.

Remember, the only things you actually need include a place to live, a certain amount of clothing, food, and water.

There are plenty of other ways to furnish your home, and you don’t need debt in order to do so!

To furnish your home, you could:

  • Use cash. Of course, I have to say this one first. You should use cash for furniture so that you know you can actually afford the purchase.
  • Be smart with credit. If you use a credit card in order to get rewards points, make sure you pay it off ASAP!
  • Look on Craigslist. There are probably several ads in your local area from people who are selling or even giving away perfectly fine furniture. You can get a really good deal this way!
  • See what your friends and family are giving away. Many people have extra furniture that they’d love to give away! This is actually how I furnished my first rental – we didn’t buy a thing!

Do you have a home furniture payment? What do you think of financing furniture?

Related Posts

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Source: makingsenseofcents.com

Financing Furniture- A Disaster Waiting to Happen

Offers for financing furniture are everywhere these days. You’ll see commercials on TV, offers in stores, signs on streets, and more.

Financing furniture is usually a bad idea. Having a home furniture payment through furniture financing is bad news as it can wreck your finances! Having a home makeover doesn't have to make you broke - you can DIY a living room, find affordable ideas, and more!

Financing furniture is usually a bad idea. Having a home furniture payment through furniture financing is bad news as it can wreck your finances! Having a home makeover doesn't have to make you broke - you can DIY a living room, find affordable ideas, and more!I see them all the time, and I can’t believe the “deals” they are promising people.

To be honest, I have never once seen a good deal on furniture financing.

I’ve seen offers for bed frames at $100 a week for a year, computers at $50 a week for a year, and so on. The low monthly payment is what pulls people in, but when you think about how long you will be making that payment, financing furniture and electronics becomes pretty unrealistic.

Side note: Of course, there are always exceptions when it comes to financing and credit. If you know how to take advantage of certain financing offers, then you may be able to come out ahead. However, if you know that you are not good at handling debt (which is probably the majority of the population), then it may be best to avoid offers like this completely.

When we were looking at furniture a few years ago (before we moved into an RV), the salesman kept telling us that we could just finance everything and wouldn’t have to feel the pain of spending so much money all at once.

The finance blogger in me probably should have slapped him because that is such a horrible suggestion.

Furniture can be quite expensive, and it can be very easy to walk out of a furniture store with a huge bill. However, no matter how enticing those financing offers may be, please remember that you will eventually have to pay the FULL cost.

Too many people get caught up when they think about the monthly payments, but it’s the full cost that is important.

Related: The Danger Of Normalizing Your Debt – Stop Living Like Everyone Else

Here is why you should stop financing furniture.

You’ll pay more for furniture if you finance it.

There’s a reason why companies push financing furniture. They know that the average person will spend more money on furniture if they can have it financed.

Furniture stores know that the average person will be more inclined to buy furniture if it’s $100 per month, instead of $2,000 upfront. However, that’s a bad way to think about spending money, as it just leads to debt!

Financing furniture can also lead to spending much more than you originally planned for. By signing up for financing or paying for a purchase with a credit card, it may make the item seem more “affordable.” But, not having the money to pay for it up front is the opposite of affordable.

Even if you can afford that monthly payment, it doesn’t mean financing furniture is the best idea. Financing furniture can lead to stress, a paycheck to paycheck lifestyle, delayed retirement, and more. No one wants to experience these things.

If you can’t afford the furniture in cash, then you definitely should not be financing it.

It’s just furniture. And, it will lose the majority of it’s value the moment you put it into your home.

Related: 15 Reasons You’re Broke And Can’t Save Money

Furniture can be very overpriced.

Furniture stores that provide financing or rent-to-own options usually have overpriced furniture.

Because of the deals they offer, like the ones mentioned at the beginning of this article, the price is often inflated to three or four times more than the actual price if you would have paid for it with cash.

The low payment is what gets people, but when you think about how long you will have that payment for, it almost always means you’ll be spending a crazy amount more.

I mean, why would someone pay $3,000 for a $500 computer?

It just doesn’t make any sense!

Please think about the full cost of those monthly payments, and compare that total with what it would cost to buy that item upfront. That alone will probably make you want to run away from any financing furniture “deals” that you come across.

Related content: Everything You Need To Know About How To Build Credit

If debt is the only way, then you can’t afford it.

The average person has a lot of debt– in fact, the average U.S. household has over $10,000 in credit card debt alone. There are loans for everything, and sadly, many only look at the monthly payment to determine whether or not they can make their purchase.

Some look to debt as a way of affording things for the rest of their lives. Instead of being more realistic with their finances, many people even “budget” debt well into their future.

Debt should not be normal. Just think about what life would be like if everyone was living debt free? What if we only purchased things we could afford? And, if we did need to take on debt, what if we were more selective and careful when doing so?

You shouldn’t have the mindset that debt is a normal part of life. Normalizing debt can lead to thinking it’s okay to use debt to pay for everything instead of focusing on living debt free.

You should make sure that you can actually afford the purchases you are making and not by just looking at the monthly payment. You should make sure you are fully analyzing your purchases, differentiating between wants and needs, and budgeting more realistically.

If the only way you can afford furniture is to finance it, then you can’t afford it.

It’s really that simple.

Related: How To Make Extra Money in 2017

Financing furniture may prevent you from reaching other goals.

A monthly furniture payment can add a lot of financial stress to your life. The amount of happiness you get from purchasing furniture can never match the amount of hardship brought on by debt.

I’ve never heard a person say “I’m so glad I have furniture debt because this furniture is so nice.”

Usually, it’s the exact opposite.

Financing furniture can cause a person to:

  • Have lots of regret
  • Not reach retirement
  • Stress about keeping up with others
  • Stress over paying bills

And so on!

Living debt free means that you are in control of the life you want. On the other hand, a furniture payment can’t bring that kind of control or happiness.

You may miss a payment and pay hefty costs.

While you might think that you’ll never miss a payment, it could happen. Even if you think that you’ll always have the money to make your payment, it is always possible that you miss it for one reason or another, such as just forgetting to schedule it.

Missing one payment isn’t hard to do. Many furniture companies require payments once a week, so you will be looking at something like 52 payments for a standard furniture loan. That’s a lot of payments to remember to make!

While you may think that missing a payment isn’t a big deal, many furniture financing deals have consequences if you miss just one payment.

You may have to pay a large penalty, interest charges, and more.

If you are thinking about financing, you will definitely want to read the terms and conditions of the loan. Many times their terms require you to pay interest charges for the WHOLE loan (starting from day 1), for just missing one payment. So, even if you are on a 0% financing plan, you may be required to pay the real interest rate (which may be 20% or more!) for the whole life of the loan, even if you are on one of the very last payments.

That 0% interest rate may not look so good now.

This is something that many people aren’t aware of, and it can completely destroy your finances!

You don’t need unaffordable furniture.

Some items are needs, but many of the things we buy are just wants. If you don’t realize the difference between your wants and needs, you may feel like you have to take on debt to fund your lifestyle.

To me, financing furniture is a want. It definitely isn’t something anyone needs.

Remember, the only things you actually need include a place to live, a certain amount of clothing, food, and water.

There are plenty of other ways to furnish your home, and you don’t need debt in order to do so!

To furnish your home, you could:

  • Use cash. Of course, I have to say this one first. You should use cash for furniture so that you know you can actually afford the purchase.
  • Be smart with credit. If you use a credit card in order to get rewards points, make sure you pay it off ASAP!
  • Look on Craigslist. There are probably several ads in your local area from people who are selling or even giving away perfectly fine furniture. You can get a really good deal this way!
  • See what your friends and family are giving away. Many people have extra furniture that they’d love to give away! This is actually how I furnished my first rental – we didn’t buy a thing!

Do you have a home furniture payment? What do you think of financing furniture?

Related Posts

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Source: makingsenseofcents.com