40-year-old homeowner says economy doesn’t add up: ‘I’m making the most money I’ve ever made, and I’m still living paycheck to paycheck’

I avoided credit cards like the plague until I turned 30 something. My partner coaxed me into getting my first one just to build my credit up, which I'm actually super glad for because my neolib credit score was so low I couldn't even get a loan for a used trash car. I have 1 rule for my credit card and it is "the bill must be paid in full every month, no exceptions" and I have never bent that rule even once. Now my neolib score varies between excellent and very good boy depending on how much i use the card on any given month.

But doesn’t paying things off immediately negatively affect your credit score?

yeah, the credit card is a tool to make spending money easier. fraud protection on credit cards in the states is better than any debit card, so it's more secure than any other option (cash, checks). make your selections, zip zap, the money moves. and the user can check their spending categories because there's a record. i love that shit.

i think where it breaks down is how the time period between swiping and actually paying for the charge can decouple the two events in our minds. combine that with how crap wages are, driving down savings, and a sudden emergency expense (car repair) can give someone a balance, that is now taking on very high interest. if they can't pay it off immediately, it now makes some other typical expenses take on interest as the balance is carried.

the "credit card float" is the term that the personal finance community uses for that window and makes a big point about making sure not to pay any utilities with a credit card, because it essentially keeps you "behind" on paying bills. it took me a bit to understand that conceptually, but the recommendation is to pay all bills/utilities straight from one's bank immediately because if you lost your job/income, you wouldn't still be on the hook for last month's bills + this month's at the same time. i know once i made that switch, i felt the bite of "catching up" immediately and realized how it was another trap and it wasn't really adding convenience in the way swiping a credit card at a store does. not to mention, utilities are always hitting us with "convenience fees" anymore, lol.

at the expense of all other races

The data does not really support this. All the lines go up from 2019-2022, especially the medians. Even the black and hispanic lines, that increased the least in absolute terms, are at or near their highest point since 1989 and saw some of their largest-ever gains since 2019.

This shows that white people have benefited disproportionally the last few years (as has long been the case, per the chart), but that everyone has benefited some. It does not show white people cannibalizing what everyone else has.

That's still a big problem, but it's more "the money spigot has historically benefited white people first and still did this time around" and less "Biden is taking from everyone else to give to white people."

Completly agree. These are perverse incentives. They never consider that the "risk" means a portion of them will be sacrificed.

I was listening to a show that had michel hudson the other day and he was talking about how it goes against the laws of thermodynamics. That you cant charge mere interest than a certain fraction of land yields or the society inevitably collapses, thats why most societies frowned upon the practice. And it was allowed on some ventures like trade expedition because it was asumed that most of them would fail and woulndt have to pay anything back.