College connection to Chiang Mai

[moe666]

Check out a real map store. If you live in a city big enough there maybe one there. Did a bicycle trip thru Wales, England, and Scotland a few years ago and found some good maps.
Also a friend who lives in Bangkok has a pretty good road map of Thailand he bought locally he uses this on all road trips around Thailand. Good luck.

[Guest]

Thanks PD.

I don't own a credit card though, and doubt I ever will again. I live debt free and I don't currently owe anyone a dime. I know people say that you can (theoritically) just use credit cards as a way to "consolidate your bills into one place" and always pay them off at the end of the month.

The reality is, no one actually does that, or the credit card companies wouldn't be a multi-billion dollar business, and American's wouldn't have an average -2% savings rate. (negative savings). I'm sure the benefits of credit card miles are great if you have the discipline not to spend at least that much to the credit card companies- but they would go out of business if that happened.

I won't be in debt again. Ever. And there is no reason to own a credit card other than to spend money you don't have.

[rxpharm]

Grunyen, very good to hear that you are debt free and are determined to stay that way!

Using credit cards is a great temptation to overspend, but if you are disciplined, plan carefully and stay within a budget, then you can reap the benefits as you stated. I have a card that accumulate points for a Star Alliance airline and I use it for almost everything. I do pay off my statement in full every month. The only thing the card company makes off me is the annual fee, so I am one of the clients they dislike.

However, don't forget the card company makes money on the other end as well - the merchants. Merchants do not get the full amount back from the credit card company - typically there is a 2-4% fee, so they get back 98 - 96 cents on each dollar you spend. The credit card company collects the full amount from you plus interest if you don't pay it off on full.

So, they can still make money off of people who pay in full monthly, but just a fraction of what they usually make.

[Road Runner]

Hello Grunyen,

If you do get to make the trip don't forget to pick up frequent flyers cards as you go.
At least they cost you nothing and who knows you may get enough miles to get some benefits.
The Thai Airways/Star Alliance one is fairly easy to build up the miles on.

Even if you get nothing else out of them you should at least get a 30 Kg baggage allowance even on the cheapest tickets.

That means I can carry many more of the shoes that Herself buys!    

RR.

[Guest]

Thanks Rx and RR. Good advice to keep in mind.

You are right Rx about the credit card companies. There is another aspect about individuals and use though. Studies have shown that people who spend at the register with a CC instead of cash spend anywhere from 20% to 70% more than they would if they have to fork over cash.

They just don't think of the card as money, and they are thinking "oh I'll pay this sometime in the vague future". BTW, this is all related in a way to my other posts about high time preference consumers from the "cigarettes / drugs" connection thread.

Moving money over time is a fascinating economic concept. The only real form of time travel invented by humans! But it can be dangerous!

[dummy_plug]

Hey Grunyen, as any finance major will tell you, don't discount the power of debt! It's all about financial leverage and understanding good debt vs. bad debt. Keep in mind, without a credit card, it's going to be hard to build your credit history. A good credit history has a wide range of financial impacts including the rate on your mortgage, rate on your car loan, rate on school loans, car insurance, etc...

[Guest]

Hey DP. I can't think of any reason why anyone would need a credit score period. I used to believe all that stuff too.

In the US at least, you can certainly get a home mortgage without a credit score. You just have to go to a mortgage broker who personally signs off on the loans. Some do this, many just use a formula. I wouldn't want to do business with the formula ones anyway.

I've never had a car loan. Why would I pay $400 a month to some car company or bank, losing interest, when I can pay myself $400 a month, buy the car that I want, and earn interest on my money while it's in the bank. I have paid cash for all my cars.

I've also never had school loans, and don't plan to start now. My car insurance is about $160 every six months.

I realize that in business, debt certainly serves a purpose in funding new emerging enterprises, but in persoanal finance, I could never recommend it to people. Of course you can find plenty of people on late night TV willing to sell you a "proven system" of how to make million in real estate using "leverage". Those shows are right after the ones with the spray-on hair.

I thought debt was really cool once, it allowed me to follow a pipe-dream, leading to clinical depression. I spent about 6 months indoors, barely ever leaving the house until there was literally nothing to eat in the kitchen. I would sleep for days, missing days on the calendar. The joy of debt allowed me to live with my expenses, while I was not earning sufficient income. I was taking what little money I made and paying it straight into my income, not paying the online hosting companies I owed money to.

My business clients finally threatened me, filed to take over their domains. My best friend dragged me out of the house and told me I looked like shit and I needed to get my shit together and get a job, even if it was flipping burgers. Another good friend bailed me out, paying up my online service accounts. I had spent about $15,000 I had in savings, and had gone about another $15,000 in the whole. It took me a lot of paying big fees to get my rent up to date and my other bills which had all been forwarded to collection companies.

I finally managed to get level. Now none of this was anyone elses fault, but without the ability to spend money I didn't have, I would not have had the luxury- and would have had to get my shit together sooner. If you listen to Dave Ramsey's radio show, you'll hear a lot of people with much worse stories than mine. I'm glad I'm not hundreds of thousands in debt- there are people who are paying 30 years for a steak they paid for with credit card, consolidated it into their 3rd mortgage, and I sure hope that was a good steak

You will always have compaund interest working for you, or working against you. The vast majority of people do not have the discipline to play with the fire without getting burned. I plan for the rest of my life to have compound interest working in my favor.

Thanks for listening to my AA meeting intro.

[relpax]

(PigDogg @ Jun. 15 2007,10:35)

(grunyen @ Jun. 14 2007,12:00) I have no income right now, and I'm trying to hold on to my savings as much as possible to pay for school.

The big expense is the airfare and if one is determined they can fly for free using United Mileage Plus frequent flier miles even if you've never flown before.

It takes 60K miles to fly free.

You get their credit card and get 20K miles.

The folowing year they offer their business credit card. Get maybe another 20K miles.

Put 10K into Fidelity for 9 months earning 5% interest. That'll give 15K miles.

Same same with Ameritrade, 15K miles.

A Netbank savings and checking account with almost no money say a grand, about 10K miles.

That's 80K, 20K more than you need.

Now if this is your one big trip make it good and tack on Bali using no extras miles.

hhmm if he is trying to hold on to his little savings and is going to school full time without working.....
how does he come up with the 10k for Fidelity?
or the 10k for Ameritrade?
Or Netbank?

I suspect that the two of you are in different stages of life.

[relpax]

(grunyen @ Jun. 16 2007,06:42) Hey DP. I can't think of any reason why anyone would need a credit score period. I used to believe all that stuff too.

In the US at least, you can certainly get a home mortgage without a credit score. You just have to go to a mortgage broker who personally signs off on the loans. Some do this, many just use a formula. I wouldn't want to do business with the formula ones anyway.

I've never had a car loan. Why would I pay $400 a month to some car company or bank, losing interest, when I can pay myself $400 a month, buy the car that I want, and earn interest on my money while it's in the bank. I have paid cash for all my cars.

I've also never had school loans, and don't plan to start now. My car insurance is about $160 every six months.

I realize that in business, debt certainly serves a purpose in funding new emerging enterprises, but in persoanal finance, I could never recommend it to people. Of course you can find plenty of people on late night TV willing to sell you a "proven system" of how to make million in real estate using "leverage". Those shows are right after the ones with the spray-on hair.

I thought debt was really cool once, it allowed me to follow a pipe-dream, leading to clinical depression. I spent about 6 months indoors, barely ever leaving the house until there was literally nothing to eat in the kitchen. I would sleep for days, missing days on the calendar. The joy of debt allowed me to live with my expenses, while I was not earning sufficient income. I was taking what little money I made and paying it straight into my income, not paying the online hosting companies I owed money to.

My business clients finally threatened me, filed to take over their domains. My best friend dragged me out of the house and told me I looked like shit and I needed to get my shit together and get a job, even if it was flipping burgers. Another good friend bailed me out, paying up my online service accounts. I had spent about $15,000 I had in savings, and had gone about another $15,000 in the whole. It took me a lot of paying big fees to get my rent up to date and my other bills which had all been forwarded to collection companies.

I finally managed to get level. Now none of this was anyone elses fault, but without the ability to spend money I didn't have, I would not have had the luxury- and would have had to get my shit together sooner. If you listen to Dave Ramsey's radio show, you'll hear a lot of people with much worse stories than mine. I'm glad I'm not hundreds of thousands in debt- there are people who are paying 30 years for a steak they paid for with credit card, consolidated it into their 3rd mortgage, and I sure hope that was a good steak

You will always have compaund interest working for you, or working against you. The vast majority of people do not have the discipline to play with the fire without getting burned. I plan for the rest of my life to have compound interest working in my favor.

Thanks for listening to my AA meeting intro.

Seems like you messed with the bull and got the horns.

That being said, i also second DP's argument that the question is not "is debt bad"? Rather is it is more of a question of using debt wisely to ultimately increase your net worth. I can tell you that my graduating class from medical school had on average a 125,000 dollar burden. The only reason that this is remotely sane (although there are still times that I question the sanity of going to medical school) is that our post residency income more than makes up for several years of poverty and debt. Same principle goes for business....etc.

[Guest]

No doubt.

[PigDogg]

(grunyen @ Jun. 14 2007,21:30) I won't be in debt again. Ever.

Me too!!!

I once had a debting problem too Grunyen. Really f*cked up my life for awhile. Even went to Debtor Anonomous meetings.

But that doesn't stop me from using my credit card. I use the card for all my purchases. I get cash back on every purchse and get about 6 weeks float using their money without interest. Always pay the balance in full at the end of the month.

I can tell from your words you won't be debting again.
Just like me.

[SamplerDoc]

(PigDogg @ Jun. 16 2007,11:57)

(grunyen @ Jun. 14 2007,21:30) I won't be in debt again. Ever.

Me too!!!

I once had a debting problem too Grunyen.  Really f*cked up my life for awhile. Even went to Debtor Anonomous meetings.

But that doesn't stop me from using my credit card.  I use the card for all my purchases.  I get cash back on every purchse and get about 6 weeks float using their money without interest.  Always pay the balance in full at the end of the month.

I can tell from your words you won't be debting again.
Just like me.

  Same Same  

I once was so bad off I had 12 cards and Mounting Debt  

Now its 2 and Pay it Off Monthly  

[dummy_plug]

(grunyen @ Jun. 16 2007,06:42) Hey DP. I can't think of any reason why anyone would need a credit score period. I used to believe all that stuff too.

In the US at least, you can certainly get a home mortgage without a credit score. You just have to go to a mortgage broker who personally signs off on the loans. Some do this, many just use a formula. I wouldn't want to do business with the formula ones anyway.

I've never had a car loan. Why would I pay $400 a month to some car company or bank, losing interest, when I can pay myself $400 a month, buy the car that I want, and earn interest on my money while it's in the bank. I have paid cash for all my cars.

I've also never had school loans, and don't plan to start now. My car insurance is about $160 every six months.

I won't debate the merits of having good credit - but I certainly believe it's useful in obtaining the best interest rates for a mortgage. I'm vaguely familiar with the so-called "low-doc" or "no-doc" loans that mortgage brokers push on clients they know won't qualify for traditional banking products (having been in the finance and banking industry myself for several years), I can assure that no reputable financial institution will be able to offer you the prime rates on the loan. We have all heard of the sub-prime lending market, which is most notorious for having tanked in the past several months leading to record foreclosures and even failures of several large multi-state lenders. Trust me, a good credit score can never be a bad thing to have and no credit score is about equal to a bad one.

I've never paid for a car with cash. Why? I think it's a horrible idea. Even now you can still find manufacturers offering 0% for 60 months (mostly domestics) but there are even deals on European and Asian brands that offer financing for 1.9, 2.9, and 3.9% on popular models. Sure I pay interest every month, but it allows me to invest all the money I would have paid for a car, which on my most recent purchase would be well over $50k USD, to invest. I could have paid cash, but instead I've invested it in the market and so far the major indices are up about 8% this year and the historic return of the S&P 500 is 10% per annum. If you want to talk about compound interest, paying cash for a car (assuming you can get a good rate) is one of the worst moves you could make. Sure the markets aren't a surefire bet on the short-term, but if you're in for the long haul you'll come out ahead every time and this is assuming you get what the index returns, which is very easy b/c all you need to do is put your money in an index fund. If you're aggressive you could really score big by investing your cash, Vanguard's International Explorer fund is up 23% per year for the last 5 years.

That said, your story is a good one. It shows that debt is indeed a dangerous thing and should not be used lightly. It's unfortunate you got burned, but it looks like you learned a good lesson and got back on your feet. Not everyone does. However, I think there's a happy medium between using debt and loans for their useful purposes and not using them at all.