Credit Card Front: It doesn’t add up!
Tuesday, May 19th, 2009
I’m constantly baffled by people that are the front man for credit card purchases.
You know the types… the people that have a credit card that fronts the purchase for someone without a credit card and will be reimbursed with cash?
For instance, I know someone (Person A) that bought plane tickets for someone (Person B) because they didn’t have a credit card. The Person B gave them the cash immediately, but instead of paying the credit card down the Person A will spend it elsewhere and continue paying on the payments.
It’s literally throwing money away. Lets say, the plane tickets cost $400. With interest and the continuouse minimum payments building up on the credit card, Person A might as well pay Person B $150 so they can front the $400 plane ticket purchase the non credit card user.
And that’s a low estimate since credit card interest rates are higher than normal. And considering that it could take YEARS to pay down a credit card on minimal payments, they could end up paying double.
It doesn’t add up nor make sense. You’d be better telling the person NO or telling them you don’t have a credit card if all you’re going to do is burying yourself deeper and DEEPER in debt.
