Wise Bread has an interesting post detailing 7 reason why one of their writers uses her credit card for everything. She finds it a useful tool for maximizing efficiency. Everything is all in one place! If you don’t carry a balance and are good with a budget, why not use a credit card as an organizational tool?
It’s great for accounting and spending reports. Since I don’t dole out cash, or make purchases on my debit card (and I rarely use cheques), all my monthly spending is nicely bundled into one report: my monthly credit card statement. Not only that but my current credit card of choice actually categorizes my spending for me, so at a glance I can see how I’ve spent my pennies for the month and year-to-date.
I don’t need to carry cash. Trips to the bank machine are few and far between, as $60 can last months depending on my spending needs.
Automated billing is great. Cell phone bills, utilities, cable, you name it. If I can sign up for automatic billing, I do. It doesn’t mean I don’t look at each carrier’s statement to ensure the charge is correct. But it does mean that on a monthly basis I don’t have to worry about paying any bills (other than my credit card!) – they’re already paid.
Do you use your credit card this way?
Top Seven Reasons why I use my Credit Card for Everything [Wise Bread]
(Photo:hamilton.lima)
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@jimconsumer:
Of course you don’t NEED credit or a credit card but I’m as frugal as they come and have plenty of savings. BUT:
I like to travel. I’m not paying cash for plane tickets for obvious reasons.
I have a backup when traveling overseas if I should lose my wallet or shoebox full of Euros.
I share a car with my other half, hence I rent one occasionally.
I buy stuff online. When “Kewlshirts4U” screws me over I don’t have to pay.
I can instantly send my mom flowers from a local florist in her hometown.
Oh yeah and I get lots and lots of miles.
@selectman:
No, I don’t believe that I missed krunk4ever’s point, I just don’t agree with it. Do you think that the credit card companies would be in business if they weren’t making money? They aren’t in this just to loan you money for a few weeks and give out free rewards; they are in it for the 5% to 30% they hit you for if you carry a balance.
Look who is making a straw man argument! Debt and credit cards aren’t something that have come about in the last fifty years. I was making the point that in the 50′s, no one would have thought twice about going into debt for something like gas, groceries, video games (if they existed), or anything else…. debt was BAD back then. We’ve been brainwashed by these credit companies into thinking it is a good thing.
Add me to the list of people who pays for everything (or as much as possible) with credit cards. If the electric company here didn’t charge another $5 to process credit card transactions, I’d pay that one on there too. (Currently disputing this one with Visa). HOWEVER, the only automatic payments I do are ones I initiate FROM my bank. I refuse to give someone permission to automatically bill me, especially my checking accounts. They can send me a bill and I’ll pay them. I pay bills as I get them in the mail, either doing an online BillPay through my bank or on my credit card. At the end of the month, I’ve got a very nice paper trail and am able to expense out the items which are reimbursable and having my nearly-complete spending in Quicken shows me exactly where I’m spending money and where I’m foolishly pissing away money. Combine that with the near-realtime transactions list for the cards online and it’s pretty difficult to go over-budget. If anything, I spend far less with the cards than I do cash.
@gacompguy: Who doesn’t pay off their credit cards in full each month? There’s no way in hell I’d pay the 8%-12% interest the card co’s want for daily crap. If you’re risking not being able to pay the bill at the end of the month, then you shouldn’t be spending it, period. Even if that does mean food. There’s always ramen and it’s kept countless college students alive during times of financial hardship after they spent too much on ethanol for the semester.
I refuse to have any debit cards, with one big reason being that the fraud protection with debit cards IS NOT the same as it is for credit cards. Visa’s terms of service make this pretty clear.
Also, I’ve yet to see any debit card which offers the higher cash/point back values, personalized services (concierge, travel), extended warranty, and product theft protection as credit cards.
@selectman: Your #4 is actually incorrect. If you have a transaction to dispute, you are responsible for your bill MINUS that transaction until its validity is proven. Despite this being an online society, the credit card rules still work in terms of billing cycles. Not sure how each credit card’s terms of service affect this, but I know my agreements say that there will be no interest assessed on the disputed transaction while it is in dispute. Once they’ve posted it to the bill, I’m then responsible to pay for it at the next billing cycle.
@gacompguy: Who thinks going into debt for anything now is a good idea? I don’t know of anyone, including the CCs who’ve advocated going into debt for something you can’t afford to pay off immediately. The “past 50 years” arguement doesn’t hold much water. People have been loaning money and borrowing money since pre-biblical times. Now we’ve just centralized it.
@jimconsumer: Can’t buy an iPhone with cash.
Not that anyone would actually want one when crippled with AT&T, but still…something you can’t do without credit. Ever try renting a card with cash? Isn’t likely going to happen either. Business dinner? Are you really going to be carrying $400-$1,800 cash in your wallet? If so, are you in the NYC area? Where do you live? And about what time in the morning or evening do you leave your house. Me and a few ..ahem..friends, would like to “meet” you to “discuss” money. We look forward to taking your mone…er, advice.
I use only two cards…Amazon Visa and the new eBay Mastercard (Sam’s only takes Mastercard). All give points. I carry an American Express and Discover card as well, but only use them if I run into some backwoods outfit that isn’t savvy enough to take MC & Visa. Just pay everything off every month and go shopping on Amazon.
@Meinhut: Just curious, where do places take Amex /Discover but not Visa/MC? In Florida it’s Visa/MC accepted everywhere, Amex/Discover rarely. Sam’s being the exception which only takes Discover and recently started taking Mastercard.
@FLConsumer:
Being in Florida myself, with Racetrac and Sam’s Club being the odd exceptions, pretty much any medium-sized or larger business accepts everything. I have only seen a handful of places take just Visa and Mastercard.
For all those that think cash, checks, and debit cards are a good idea, they are not. Cash can be lost and stolen, when it is, it is gone. Checks are pretty much completely insecure, only use a check if you sincerely trust a person. Debit cards are linked to your bank account. There can be difficulties when these are stolen and used, not to mention fees such as overdrafts, etc.
@yg17:
I use if for mostly Amazon purchases myself. If you want that Volkswagon card, you will have to apply for a new one. Most banks will not transfer cards while deactivating the old one. You would need to apply for it and close the old one, a negative effect on your credit twice.
The only exception I have seen is Target, whereas if you have the regular Target card, they can upgrade it to the Target Visa card and the other is automatically deactivated without a cancellation. This is Target Bank naturally, they only offer their own card.
@randombob: That makes sense for CC bills which fluctuate, but car insurance doesn’t really change that often and when it does you get a premium notice in the mail, so it’s not like you wouldn’t know about it. I think auto payments are great for expenses that are static (mortgage, car payment, auto ins, etc.)
CC’s for travel and major purchases, some online stuff, and not much else. I use my debit card for the rest and cash for lots. I don’t particularly cotton to all of my purchases being tracked by some huge conglomerate.
@greatmoose, @curbrunner and @full.tang.halo … I’m in your camp.
I do, except for the automatic payments. (I have trust issues.) I treat my CC like 80s scifi “credits” – automated money is the way to go. I never use my execrable math skills to balance my own checkbook, because I never write checks. Let the computers add the numbers.
(It prolly helps that I bank at a credit union; they’ve never done anything evil to me.)