Tuesday 13 November 2007

Impulse Buying and the Dangers of Credit

Citibank sent me an offer to increase the credit limit on my Redicredit account by $10,000 to $55,000. I don't use this account very often (it used to have an interest rate around 10% so was OK for short term use when I wanted to write a cheque for a mutual fund investment or share purchase plan, but recently the rate was increased by several percentage points) and I don't carry a balance (except when they offered a 0% rate for 6 months which I used to pay some interest due on one of my margin loan accounts). However, it is always handy to be able to write out a cheque for a large amount if needed, so I'm sending in the acceptance form.

Today I also received an email notification about an online coin auction being run by the coin dealer I had bought some silver coins from last year. I had a browse through what was on offer and saw a 2002 10oz Proof Silver "Evolution of Time" coin was on offer with a minimum bid of $275 and no offers as yet. After a quick check on the internet I confirmed that this coin is currently on sale from the perth mint for $367, so at $275 it would be a good deal. I entered a maximum bid price of $276, which meant my initial (and only) bid was at the minimum price of $275. I didn't bother checking if anyone else bid on this item during the day, but tonight I received an email confirming that I had "won" the bidding on this coin. So I now have to arrange payment and delivery.

Luckily I'm not usually an impulse shopper, otherwise a $55,000 line of credit could be dangerous ;)

Copyright Enough Wealth 2007

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