interest Archives • Bitches Get Riches

How to Build Good Credit Without Going Into Debt

May 17, 2023May 17, 2023 Jess Fickett ("Piggy") 4 Comments

Adult human beings need credit—good credit—to do lots of important adult things such as renting apartments and buying cars. We’ve been over this! But conventional wisdom says that the best way—nay, the only way—to build good credit is by accumulating debt.

That assumption about building credit through getting in debt feels backwards to me. For after all, the entire purpose of a credit score is to show that you’re worthy of loans. So you have to owe money so that you can then… owe money? And having debt, whether it be in the form of a balance on a credit card or just Ye Olde Student Loane, can lead you down a fucking terrifying cycle of overspending and interest that can eventually damage your credit, rather than helping it.

So let’s toss out the conventional wisdom. There’s got to be a better way! And there is. For it’s entirely possible to steadily build good credit without going into a day of debt.

{ MASTERPOST } Everything You Need to Know about Credit and Credit Cards

January 5, 2023July 31, 2023 Jess Fickett ("Piggy") Leave a comment

You didn’t want to watch a scary movie. But your friends at the 10th-grade sleepover insisted. “It’ll be fun!” they said. “Don’t be chicken!” they said.

Now you find yourself huddled under blankets on the couch in your best friend’s basement rec room giggling nervously over popcorn and hoping you won’t pee yourself at the first jump scare. Your friends shush each other as the movie starts.

Creepy music ushers in the opening scene. Lighting and thunder clash on the screen. With the lights turned off and you trembling with fear, the title of tonight’s horror movie flashes across the screen: Credit IV: It Comes for Us All.

Watching horror movie Credit IV: It Comes for Us All

One of the most common questions we get here at Bitch HQ is “… creeeediiiiit??????” And that’s not surprising! The system of credit reporting, credit scores, and credit cards is hella confusing. It’s also pretty fucking classist, racist, and ageist… by design. Heckin’ scary, man!

So to fulfill our mission of [checks notes] sticking it to The Man by democratizing financial acumen, we’ve written and said a ton on this topic. Here it all is: our primer to understanding and managing your credit so you can use it to get ahead… or at least prevent it from getting you down.

Credit Card Companies HATE Her! Stay Out of Credit Card Debt With This One Weird Trick

May 17, 2022May 17, 2022 Jess Fickett ("Piggy") 30 Comments

Kitty was once at an event where a credit card company was hawking their new cash rewards credit card. The credit card rep excitedly told her about all the cash back rewards she could earn by using the card, and how the interest wasn’t even “that bad!”

But mama didn’t raise no fool. Instead of falling head over heels for low interest, Kitty asked, “But what if someone pays off the credit card debt in full and on time? Will they still get the rewards?”

“Ah,” the credit card rep sighed, “we call those people deadbeats.”

That’s right: deadbeats. Credit card companies fucking hate people like Kitty and I. And that’s exactly how we like it!

Dafuq Is Interest? And How Does It Work for the Forces of Darkness?

April 21, 2021June 16, 2021 Jess Fickett ("Piggy") 10 Comments

Here at Bitches Get Riches, we’re constantly extolling the virtues of compounding interest, which Albert Einstein, Mother Theresa, and Nelson Mandela all deemed the Eighth Wonder of the World.* This might lead personal finance novices to believe that interest is universally a great and wealth-building thing. Not so, dear readers. Not so.

Just as interest can work for you, contributing mightily to your financial goals over a long period of time, so it can spell your very doom. DOOM.

Like a monetary Dr. Jekyll and Mr. Hyde, interest has both your best interests (see what I did there?) and your utter financial destruction at its heart. Let’s explore its dual nature with a healthy dose of hyperbole, shall we?

*Not intended to be a factual statement

Dafuq Is a Down Payment? And Why Do You Need One to Buy Stuff?

January 12, 2021February 9, 2021 Jess Fickett ("Piggy") 2 Comments

“What is a down payment?” In an ideal world, no one would need to ask themselves this question because no one would need one! Expensive things like cars and houses and college educations would be a lot more affordable. Enough so that we could pay for them with the money that we already have. And we’d all have mountains of it.

But unless you have a Scrooge McDuckian money vault at your disposal, buying a car or house or bachelor’s degree in cash is probably impossible. Down payments are necessary because of how our world works. Today we’re going to teach you what they are, when you need them, and how to use them to your advantage.

Season 2, Episode 10: “Which Is Smarter: Getting a Loan? or Saving up to Pay Cash?”

September 11, 2020October 27, 2021 Lauren Torres ("Kitty") Leave a comment

The financial lessons we received from our parents are problematic for many reasons.

For one thing, they’re often out of date, as the economic atmosphere of the 1970s and 1980s is a far cry from what we’ve experienced in a post-2008 world. We’re long past the quaint advice to pay for college by “getting a summer job” and to start a career by “walking into a business and asking for a job in the mailroom.” Heckin precious.

But there’s also the way an assumption of background knowledge can lead to further confusion. For if you don’t understand basic financial principles, the sweet knowledge nuggets your beloved Boomer dad drops on you might go down like lead balloons. Just as you can’t understand where Beyoncé came from without Destiny’s Child, you can’t talk about getting loans until you understand how interest works!

This week we’re dealing with just this issue. Petey is one of my oldest and strangest friends. I made him walk down the aisle with Kitty at my wedding in the hopes that those two weirdos would have a vulgar joke-off (alas, they conducted themselves with the decorum expected of a bridesmaid and a groomsman and saved the nasty shit for the dance floor).

Petey has his head all in a tizzy over his dad’s vague and incomplete financial advice. So we decided to set the poor boy straight!

Ask the Bitches: “The Government Put Student Loans in Forbearance. Can I Stop Paying—or Is It a Trap?”

July 14, 2020April 15, 2022 Lauren Torres ("Kitty") 11 Comments

So… I made a mistake.

Our Patreon donors have been so wise with choosing quality topics in the past. So this month, I invited our supporters to pitch article topics directly to us.

Sounds great, right? WRONG. This was a huge mistake because all of our supporters’ ideas are fucking great! Now I have no choice: I simply must write them all. When am I supposed to do my life’s most important work: incorrectly cutting the wood for my woodworking project, then driving to Lowe’s to buy more wood???

This is technically incorrect. Piggy is the Chip.

One question stood out as being particularly time-sensitive, so today I’m answering this question from our patron Rachel, who we all know to be so glitteringly beautiful that she’s regularly mistaken for an ice sculpture of herself:

I’d love to know your thoughts on U.S. federal student loans currently being deferred with no interest. Is it smart to continue to make my regular loan repayment? Or should I stop making student loan payments and use that money to invest in other things?
– Patreon Donor Rachel

An excellent question! Today we’ll address the basics of student loan forbearance, including how it pertains to the CARES Act. (That’s the $2 trillion stimulus package we explained here.)

Luckily there’s a fairly definitive answer, which I am just barely capable of explaining in human speech. Let’s get into it!

Ask the Bitches: I Want To Move Out, but I Can’t Afford It. How Bad Would It Be To Take Out Student Loans To Cover It?

October 3, 2019June 3, 2022 Lauren Torres ("Kitty") 9 Comments

We have a question today from a Tumblr follower. If you don’t follow us on Tumblr, you should! Piggy is one of the Tumblr Deep Ones. She’s been on the platform since its infancy, and she answers tons of reader questions.

Like this one!

I need to move out, but I don’t have any money actually saved up. I do have a job that can cover my monthly costs and still have some left over. So I was wondering just how bad of an idea it is to take out a student loan to get me out of my situation and then immediately work on paying it off.

Ah. A very relatable dilemma.

For most people (and families), housing is the largest item in their budget. Young people spend, on average, a quarter of their income on housing—more than any other age group. Which means that saving money on housing can have an enormous positive impact on your finances. Especially when you’re young.

But is it ever a good idea to strategically spend a lot more than you have to on housing? Spoiler alert: yes, it absolutely can be.

Let’s get into it!

Investing Deathmatch: Investing in the Stock Market vs. Just… Not

October 16, 2018June 1, 2022 Jess Fickett ("Piggy") 10 Comments

It’s time for another thrilling episode of… INVESTING DEATHMATCH! In which we pit two forms of investing against each other and see which one escapes the struggle unscathed.

Today’s fight is an ancient grudge match between two opposing philosophies: extreme caution and risk-taking. In one corner we have investing in the stock market—an inherently risky proposition but one that comes with untold rewards. In the other, we have the option of the risk-averse everywhere: just… not with the stock market, and instead, playing it safe by sticking your money in a savings account.

It occurred to us that we needed to cover this battle to dispel some incorrect assumptions about money management.

After the Great Recession and stock market crash of 2008, a lot of young people coming of age in a new and fragile economy were scared away from the stock market. They saw the grownups around them ruined by plummeting stocks and improperly leveraged debt.

As a result, millennials are statistically less likely to have anything invested in the stock market—whether it be through a retirement fund or a managed portfolio. These younglings are choosing to play it as safe as possible.

But is that truly the way to win this Investing Deathmatch?

Fighters… TAKE YOUR CORNERS!

Let’s End This Damaging Misconception About Credit Cards

April 2, 2018January 3, 2024 Jess Fickett ("Piggy") 18 Comments

I don’t know who started the rumor that carrying a balance on credit cards is good for your credit score, but I hope they step on a lego in bare feet every day for the rest of their lives.

You shut your pie hole, Poppins. This is serious.

Of all the damaging misconceptions about personal finance we’ve had to correct over the course of running Bitches Get Riches, this is by far my least favorite. And it keeps popping up again and again in questions from our followers! Why? How? Who is teaching all of our darling kangaroo babies such a terrible way of handling their credit cards?

Until I can find the culprit and give them their just desserts (hot oil? The rack?), I have made it my mission to set the record straight.