Monthly Archives: January 2014

Interview With SB Of One Cent AT a Time

Tell my audience about yourself. What made you want to start your website
I was regular personal finance blog reader, I read sites like Get Rich Slowly, Simple Dollar, etc since 2006, after I came to this country in 2005 from India on a work visa. I wanted to learn the financial system here and ways I could save money being in a foreign land.

Slowly I realized I was a bit different from these bloggers, I grew up in poverty in a third world country and frugality was necessity there, not a choice. I thought I could add values by putting my approach to personal finance in public.

Being in the software industry, setting up a site and starting with my own blog was easy for me, what took real time though , was to acquire the writing skills that might fit the readers here. It took real courage to start with OCAAT, having English as my third language.

I was inclined towards better financial management since the time I was learning maths and languages, it was the trait my father possessed and passed on to me. Then, combine that natural liking with an ambition to put my voice in public.

All these things contributed to formation of the blog One Cent at a Time.

Please name some quick and easy ways for a person to improve their credit even if they’ve recently been through a divorce or some type of financial calamity?

This is one of my favorite topics in personal finance, I have quiet a number of posts on the category “Financial Disaster”. While it’s always best to prepare for such disaster, it’s not uncommon that people still find them midst of a financial meltdown, simply because they were not prepared for it, even the high income earners.

To answer the question, I’d assume there weren’t sufficient insurance coverage and emergency fund cushion available to the person who underwent a similar disaster recently.

The best thing to protect credit is to sit in the drawing board and re-budget finances. I’d immediately try to find temporary respite with long-term balance transfer credit cards, if I can’t pay the minimum due for next few months.

There are cards available that offer even 12 months interest free balance transfer, I’d use that to consolidate my credit card balances to one such card. Then I’d see if I still need the car where I’m paying the car loan. My immediate action would be tos ell off the car and rely on public/friends’ transport for my travel need. Or a less costly used car which I can buy from the sell proceed of my current car.

So far I have taken care of my credit card dues and car loans. Now let’s take the mortgage and student loan situation.

Mortgage can be handled the way car loan was handled in my hypothetical scenario above. I’d sell my house and move in to a rental apartment. In extreme situation, living with parents is far better than living on streets (you got my point, right?)

Student loan, I’d try to pay off the minimum amount, by whatever way possible. By cutting my budget, by taking up side gigs, etc.

When a person walks into a car dealership what are some credit questions you recommend that consumer ask the salesman or finance manager?

I think I should tell your readers that I have car loan where I am paying 0% interest on 5 year loan of $14,000. That was only possible due my extremely high credit score. Now one tip, do get your credit score before beginning your search for a new car.

1. Ask them to hold off on credit inquiry, till you have the final decision to buy
2. Interest rate for the score range you are in
3. What other companies you can borrow from , apart from the dealer provided default financing option.
4. get some quote from market and compare with what you hear at the dealership and then decide
5. Calculate the true cost of owning the car (adding the total interest you’ll pay) and then decide which car to buy, used or certified or brand new.

How long does the credit restoration process take?

I am sorry I have no idea on this. But, there is a shortcut way to avoid this situation. When you have a good score, get your mortgage done. You’ll no longer have to worry about score fluctuation as long as you stick to purchasing your next car on cash.

If a person can’t purchase a vehicle in cash, what’s the ideal down payment you recommend they have? Does a larger down payment mean a shorter loan and APR?

As much as possible! I am true advocate of purchasing things on cash. The $14000 car loan I talked about was after paying down $12,000 cash. I won’t suggest people to do the math by comparing the interest rate on the loan with hypothetical rate of return on investment.

To me, if you are debt-free you are really free, it doesn’t matter if you are paying only 3% interest on your car loan and earning 5% return on your investment.

It’s in our brain, we tend to spend money when we have it, when we don’t have money we generally cut down on various expenses.

When you don’t have enough cash to purchase, first consider buying a different car you can afford. Don’t go for brand new Toyota Camry, go for an used Toyota Corolla. In my case yes, the larger payment coupled with excellent credit meant 0% interest rate!

If your a first time car buyer and you’ve never shopped for insurance before, what are some tips to get the lowest payment possible? What are some questions you should ask your insurance agent?

Its tricky and I went through this situation in 2005, right after getting my drivers license. No one were willing to insure me. I had to call up as much as 5 insurers before I could take out my first car from dealership.

You don’t really have much choice when you are trying for car insurance for the first time. You’re not choosers then. So I’d advice take whatever least you get to cover the state required minimum coverage.

Then wait for 2-3 months, and again start shopping around for lower rate. My first premium to 21st Century was $1250 for 6 months. within 6 months I was able to bring it down to $890. And within a year I was paying less than $500. Now for our two cars we are paying only $678 for 6 months.

I don’t think talking to insurance agent would reduce your premium, you can do it online or by calling their call centers. go for absolute minimum coverage that is required by law. having a good conversation is not going to reduce your premium in any way.

Besides what are some of websites/blogs you would recommend our visitors visit while trying to improve their credit?
I’d recommend going through Daily Finance, Wise bread and Mr. Money Mustache. They are my favorite.’s ‘blog’ section is also an amazing place to learn everything related to credit.

Thanks SB for the interview. Please visit One Cent At A Time Below and social media channels!
One Cent At A Time
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This is our thirty first interview in our “1000 Interview Challenge” If your interested in an interview, please contact me.

This interview was conducted by Shane McC. Shane currently is attending RISD studying computer programming. He enjoys traveling and plays hockey. He played for the Boston Junior Bruins of the EJHL during the 01-02 season. You can follow him on Google+