Hey, I was wondering if someone needs credit to buy things. People in my family have said I wouldn’t be able to buy a car or a house without credit. But if I’m saving up cash to pay for things outright, do I really need credit?

Note: I’m sorry if this is the wrong place to ask.

  • scoobford@lemmy.zipEnglish
    0·
    8 months ago

    Pretty much, yeah. You can probably save up to buy a cheap used car, and you may be able to save up to buy a new car, but you definitely won’t be able to just pay cash for a house unless you’ve got so much money the rules of personal finance are totally different.

    You also need good credit to rent most apartments and to get many kinds of jobs.

    Edit: I almost forgot, cashback is pretty cool too. 2% of your expenses for the year can be quite nice.

    • DaddysLittleSlut@lemmy.worldOPEnglish
      0·
      8 months ago

      I’ve created a plan to save $1,000-$2,000 every month for 25-30 years at a realistic interest rate of 2-3%. By the end of it, I’d have around $886,389.54.

      • inconspicuouscolon@lemy.lolEnglish
        1·
        4 days ago

        If you intend to put this money away for a long time, and you won’t be tempted to take it out prematurely, it would be wise to invest in a low cost index fund (invest in stocks and bonds, basically). If you are in the U.S., you can invest in a Roth IRA and take the funds out prematurely ONLY if it is for purchasing a first time house. You earn far more interest that way.