ALL CLICK HERE(PLEASE). In dire need of help!!

Christian713

Hello everyone,
I'm 17 years old and have very little capital; furthermore, I'm an idealist with an incredibly naive disposition. To be honest, I don't even have a savings account. I have nothing, pretty much--except, of couse, what's in my pocket.

I'm most likely starting college next year and 75% of the tuition wil be covered by scholarships I've already acquired.I really don't know the ways of the real world; and having realized this, I'm overwhelmingly tentative. Being that once I turn 18 I'm on my own, any advice given here will be earnestly absorbed and appreciated.


I would like recommendations from each one of you on how I should start my financial venture.
I literally mean: How should I arrange my inception into Capitalism.

I'm mostly interested in:
How should I go about choosing which bank suits me best. Especially since I'm young and poor.



I'm also interested in how to start building my credit.







Thank you all.

dchurch24

The only words of advice I have are: resist credit as much as you can. I managed it until I was about 27 - and have regretted it ever since; save for the things you want/need, don't borrow.

However, having said that, one day you will most likely want a mortgage and for that you will need some form of credit history- Barclaycard do a credit card for people with no credit history - the rate is high for that reason. Apply for one, then cut it up and throw it away.

Also, get on the electoral role if you are not already.

tesuhoha

There was a kid in the news recently who made a fortune (about a million i think) from designing his own web site and selling pixels. I wouldnt know a pixel if it stared me in the face but couldnt you do something like that? He made enough to pay his way through university

MickKnipfler

Steer away from credit: If your outgo exceeds your income, your upkeep will be your odwnfall!

dchurch24

Also, get a basic account with no overdraft, and get a part-time job, not a student loan (and/or OD from bank).

That's what I did - and my GF of the time as well.

It wasn't until I bought a house that I became saddled with debt, which meant leading up to that event, all money I earned was MINE - I had to pay interest on nothing.

It was also a lot more stress free.

Scully's_Girl

Go for savings accounts that give you a good interest rate (above 3%). Do NOT be drawn in by bank accounts that give incentives (like an IPOD). They prey on students like you & the return is pants.
dchurch24 couldnt be more right. You will have MANY friends around you who show their plastic & get lots of nifty things. Credit is not free, & the payments will bite them in the tail later on. I've been working for 8 years since leaving university & still make sure everything I buy is in cash (just bought a new car at £15,000 last year cash, and one for my dad). Back in the day our parents saved for the stuff they needed, & they could afford to live on one salary. We cant anymore in large part because of the debts we build up. Nip it now while youre young.
Open a cash ISA, Alliance & Leicester has a good rate now but check out Martin's comments on the subject. All interest you get is tax free & you can withdraw at any time. Since you have little income you might stay beneath the £3000 annual limit, so you're doing ok there.
Being American, I totally see our Buy Now, Worry About it Later culture infesting the British way of life. I don't live that way. All of us on these boards know its FOLLY to live that way. Debt is not normal & its nobodys right. You'll be pressured by your peers at times to spend more than you have, as they will be. I no longer envy the guy with the BMW nextdoor, since I know the interest rate hes paying.
Stick to the ideas here, be ahead of the game & you'll be ok.

codetown

Just choose with care the banks you deal with and never ever get a loan unless you are really desperate or hungry. Consider yourself already lucky. At present the UK bank system is quite low-cost (nothing to pay for most operations).

If you want really to venture in something more (like a company) then you will have to have the ideas first and then worry about capital.

moneyandmountains

dchurch24 wrote:

Th
However, having said that, one day you will most likely want a mortgage and for that you will need some form of credit history- Barclaycard do a credit card for people with no credit history - the rate is high for that reason. Apply for one, then cut it up and throw it away.

That won't help your credit history much. Better to set up a direct debit so that it is always paid off in full, so you treat it like a debit card, or keep it for emergencies (e.g. when travelling). Plus, if you ever need to purchase goods (e.g. a computer), then it gives you the protection of the consumer credit act and often free insurance.

For example, when I was an undergrad student Barclays would only give me a £250 credit limit. As I was buying a computer, I arranged to pre-load my credit card with money transferred from my savings, to get the extra protection.

Personally, I would take a student loan if its interest rate was lower than that of a savings account. Then put the money in an ISA / a high interest rate savings account. Now take the paperwork and put it in the safe trust of a parent / guardian, to stop yourself spending it in a moment of frenzy. This could potentially help you with some startup capital once you start full-time work or at least give you some free interest.
A similar strategy can be applied to interest free overdrafts, but only if you have the discipline not to spend the money.

Don't forget to fill in a R85 for all your bank accounts, so you receive gross interest.

DocProc

:-)

There is absolutely nothing wrong with borrowing money for a properly valid reason.

However, it is a bit daft to borrow money if you cannot afford to pay the capital and interest repayments.

I do hope you will use any money you borrow to help you buy appreciating assets of some kind. It isn't a good idea to fritter it away on booze and good nights out.

One last thing.....

Do find out about the concept of 'gearing' (or 'leverage' as it is sometimes known)

Sorry, one more last thing.....

If you want to be a really good capitalist, then do use 'gearing'.

Have a read at [URL=http://]http://en.wikipedia.org/wiki/Leverage_(business)[/URL]

Christian713

I must mention, I live in America. I certainly hope this doesn't vex any of you.

Christian713

All right, after having done a bit of research, I've returned for your further input.

From what I understand:
Capitalism is an expedient game; everyone is in it for their own private interest. In order to survive the hardships, one must approach it with great prudence. In my case, the making of a Bank account: which, I've pretty much concluded is the inception into the American economy.
Now, to do this right, to make it to the end so I can enjoy the comfort of financial stability once I'm ready, I'm going to have to to start it right.

One character claimed the key to surviving is, "If your outgo exceeds your income, your upkeep will be your downfall."

It makes since.
But, being that I don't have a thorough appreciation for the art of Financial mastery, I have a few questions of my own.



1.) Many warn of the dangers of credit. "Be very reluctant when seeking for credit or loans. Save for the thing you want/need; don't borrow."
Credit is not free, and the payments are incredibly cumbersome later in life.

So, then, how would I go about building my credit score without actually using a credit card?



2.) When making a bank account, from my understanding, go for ones that: have good interest(possibly above 3%);
interest is tax free and that it can be withdrawn at any time;
and one with no overdraft. Now, I don't know what overdrawft is, so I was hoping someone with a comprehension of overdraft to elaborate a bit.

3.) Can I open an ISA in America?

4.) What is the electoral role?

5.) How would you all, if given the opportunity--well, the misfortune of not having money--start if given a thousand dollars. Anything brief will be greatly appreciate.