Is a credit card a necessary evil? - Page 2 - Mothering Forums

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#31 of 39 Old 01-14-2011, 08:17 PM
 
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I had my debit card numbers stolen twice from a store and once online. Debit Cards are super hard to dispute charges on. I've had holds put on my debit card for hotel travel and rental car. growing up my family and I got to go on numerous free vacations because of points that my father gained using his credit card for business .
It would make me nervous to carry around large amounts of cash for emergencies. At Least if I lose a cc or it gets stolen then I can dispute it where as with cash.I'm just screwed greensad.gif
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#32 of 39 Old 01-14-2011, 08:26 PM
 
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I don't think they are necessary but they are useful in some situations.  I don't have any atm, but I will eventually get one again to use occasionally.  You need one for paypal if you want to use instant transfers, and they are very handy for travelling and things like that. 

 

eta: I'm in Canada, where debit cards do not work the same. I might just use a debit card if I were in the USA


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#33 of 39 Old 01-14-2011, 08:54 PM
 
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We didn't have one for the first few years of marriage. We eventually got one for ease of buying things online, with the minimum limit ($500). DH also has a business credit card now that he's started his own business.

 

For us, it's never been a problem. I find it a slight hassle to have both credit and EFTPOS cards, and usually use the latter - I could live quite happily without a CC, although I do occasionally order pizza online with it. But we've never not paid it off in full, and it's apparently better for your financial track record to have a history of paying off your CC promptly, rather than a history of not having a CC at all (which seems crazy to me, but OK!). So... meh. Like a PP said, I don't see it as either necessary or evil. But if you have issues with spending money you don't have, then yeah, avoid them like the plague!


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#34 of 39 Old 01-15-2011, 06:23 AM
 
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Quote:
Originally Posted by SilverFish View Post

good money managers don't have financial crises no matter what method of payment they prefer, poor money managers are going to come up short no matter what.


I think this is sort of discouraging to the op. If getting away from credit cards helps you manage your money better; it's a change worth making; just like writing down what you spend, or anyother habits like that.


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#35 of 39 Old 01-15-2011, 07:24 AM
 
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Quote:
Originally Posted by texmati View Post



Quote:
Originally Posted by SilverFish View Post

good money managers don't have financial crises no matter what method of payment they prefer, poor money managers are going to come up short no matter what.


I think this is sort of discouraging to the op. If getting away from credit cards helps you manage your money better; it's a change worth making; just like writing down what you spend, or anyother habits like that.

 

well, i guess it sounds kind of harsh, but i think it's realistic. if you don't work on changing your financial habits, i really don't think it matters whether or not you have a credit card or not. sure, cutting up the credit cards for a while might help break a cycle and might be part of your road to financial security, but i think it's putting the blame on something inanimate to refuse to use credit cards. if you don't look deeper and address the root causes of your financial problems, everything you try is just going to be a band aid solution...
 

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#36 of 39 Old 01-15-2011, 02:22 PM
 
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I had a rewards credit card which we paid in full every month with my mid-month paycheck.  (I got paid twice a month --about $1500 per check-- on the first and the fifteenth.  The paycheck from the first went to rent.  We put everything else on the credit card and paid it with my check from the fifteenth)  Well, we decided to switch to me being paid once a month (on the first).  We have a balance of just under $2000ish on the card.  I don't get that midmonth check I was expecting.  And my first of the month paycheck is was $1500.  I put more on the card just to keep a positive balance in our account.  Then, the cost of gas skyrocketed and we lived a 30 mile round trip from my work.  I started using the card to make up the difference between our cost of living and my paycheck.  Plus, we stopped putting everything on the card with the intention of paying it off.  So, I was having to find money to pay the card while looking for money to pay for all our expenses--and more kept going on to cover the difference on COL and paycheck.  The balance ballooned up to about $8000--twice my monthly salary.  At 29.99% interest, I was barely able to pay it, so I opened another card to transfer the balance.  I was only approved for half the amount.  So, I transferred half the amount--then the first card cut my available credit to about $4000.  So, now I had practically no credit.  DH had no idea we even had an active credit card.  I opened a third line of credit to buy Christmas presents a couple years ago...and a military store card "for uniforms"--which I maxed out on junk and only spent 25 cents on the uniform part.

 

3 of our 4 credit cards (the original card, the military card and the christmas LOC) will be paid off by the end of this month/beginning of next month when we get our tax return.

 

ETA:  we've started working a budget and a modified Total Money Makeover.

 

OP--figure out your expenses bare-bones (cutting cable and everything if necessary) and then multiply it by 3 and shoot for saving that amount.  It will be two steps forward, one and a half back (ie, you get $1000 saved-yay you!- then the car needs repairs to the tune of $750, but you won't have needed to put it on credit.  And if the repairs are to the tune of $1200, well, you only need to come up with $200.)

As for vacations--if you need to put it on a card, then you can't afford the vacation.

 

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#37 of 39 Old 01-16-2011, 12:06 PM
 
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I love our credit cards and consider them necessary. We mainly use a Costco AmEx which pays 1.5-3% cash back, depending on the purchase category. So far we'll get back over $350 this year. (We had some big medical costs this year, usually we get back around $250) Like other posters, we put everything possible on it. We have a cash-back Visa for places that won't accept our AmEx. I also like those no-interest cards. We've bought several appliances that way. I got a no-interest Discover card to finance some necessary home repairs. We had the money in our savings, but preferred to stretch it out over several months w/ no interest.

 

I notice some posters equating using CCs with spending $ that isn't there. Personally, we see our CCs as cash, and so never put anything on there that we don't plan on paying off that month, or w/i the no-interest window. I think as long as you have a game plan for your spending, CCs are wonderful tools--I love not having to carry around cash or a checkbook, and I love the perks some CCs offer.

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#38 of 39 Old 01-16-2011, 03:42 PM
 
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We use debit cards but not credit cards. If it doesn't come out of our savings we don't buy it. We've paid them off and reopened them and it never turns out well so we refuse to use them!


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#39 of 39 Old 01-17-2011, 07:01 AM
 
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Quote:
Originally Posted by Smokering View Post

it's apparently better for your financial track record to have a history of paying off your CC promptly, rather than a history of not having a CC at all (which seems crazy to me, but OK!)


If a bank is trying to decide whether or not to extend you credit, which will look better to them?

 

   Person A: history shows s/he pays off debt in a responsible way

   Person B: no information available

 

Person A is a better risk. Person B could very well be responsible with debt, but there is no data to show this.

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