Financial Freedom: Chase and Orchard Bank
There was a time long ago when I didn’t have debt. I get to revisit that time again — partially. Two weeks ago, I completely paid off Chase and Orchard Bank.
Coincidentally, both of these were a considerably low balance ($200 or less) on them, but I looked at my interest rate and I was stunned. They were charging me 28% interest (Ouch!) on them and I paid little attention to it. Well, high interest can’t hurt me if there’s no balance, right?
My only question is do I keep the account open to have it reflect some (good) remarks on my credit history? Right now that matters to me, since I made some awful mistakes and still will be mending the financial damage I’ve done to myself.
I’d like to know what some financial pro’s think about me retaining a zero-balance credit account. Let me know in the comments! 
There are a few benefits of a zero-balance credit account as opposed to none at all (providing you aren’t paying annual fees to keep the account open):
“Oh Snap!” money- Vandals throw a brick through your windshield and you need to fix it because it’s going to rain tomorrow and you don’t get paid till next week. Unforeseen medical bills. Honey, I’m pregnant. Dishwasher is flooding your kitchen. You name it- if it hasn’t happened yet it will in the future and that account will soften the blow.
Credit to debt/income to debt ratios- your credit is based in part on how much debt you have versus how much money you make. Also factored in is how much credit creditors have extended to you versus how much you use; so essentially what you’re saying to the bank is “hey look all these companies are offering me money and I’m so secure I don’t even need it.”
It’s good to see more young men getting interested in financial responsibility- getting away from the mentality of living-beyond-your-means materialism. Of all the topics on this blog, the fact that you get people interested in financial matters is the most laudable.
Seriously, the 4 best things you will ever do for yourself are being financially savvy; taking care of yourself through diet, exercise, and mental-wellness; ensuring you have the best possible equipment and training to defend your life/loved ones/property that you are legally, financially and physically capable of; and ensuring you are prepared for self-reliance in the face of disaster/civil unrest.
Since few have the time or motivation to care for their bodies and minds; and the media has made many too afraid of being branded a “gun nut” or “survivalist” to own firearms or prepare for disaster; financial savvy is the most readily accepted means of self-improvement.
Congratulations on paying off the balances. That APR sounds horrendous, but considering what others are paying, it’s not as bad as it can be. I used to work in the mortgage industry, so I do know that there are a lot of tricks in keeping that stupid FICO score decent. If you have an excellent payment history for more than the last 12 months with those two creditors, I suggest writing a letter to the creditors and ask them to lower your interest rate. In your letter, remind them of your payment history with their company and how that’s proof positive of your new found fiscal responsibility. If neither lowers your APR, at least you tried. If both do, great. After hearing back from both creditors, close one of the cards. If both or neither lowers your APR, close the card that you’ve had the shortest time. If one lowers your APR and the other doesn’t, close the higher APR card. If either (or both) charges you an annual fee, mention that in the “Lower my interest rate” letter, that based off of your payment history you don’t feel you should be charged an annual fee. Again, it’s not going to hurt, all it can do is save you some money.