Credit card or Debit card?

[eldorado99]

I've never understood the people who don't use credit cards based on the fact that they think they will screw up and end up in debt. Are they unable to keep track of how much money they actually have in the bank? For example "I want a new TV, I do not have $1000 in the bank, but my credit card will pay for it!".

I will also never understand people who get a credit limit increase and go blow a grand or two because they think it means they have more money, do they not realize they are going to get a bill in 3 weeks asking for the money they just spent?

EDIT: By no means am I claiming to be a strong willed person, far from it most of the time, this is just something that has always been a no brainer to me.

 

[MrDudeMan]

Originally posted by: Doctor Nyse

Originally posted by: MrDudeMan

Originally posted by: HardcoreRobot
credit, for all the reasons listed above

Debit card... I only spend money I have at that exact moment

me too, except with a credit card...

ha, me too. It's amusing that people think they are being smart with statements like that, but I've never spent a penny I didn't have and the only thing, literally, that I buy on my debit card is food from Sams because they won't take my credit card. That's it. In almost 4 years, I've paid $0.00 in interest and earned a little over $1,500 in rewards for money I had to spend anyway.

It makes no sense to use a debit card unless you absolutely have to like I mentioned above. No sense at all.

Well the difference is that you pay a bill at the end of the month. I pay for what I purchased at that exact moment.

The end.

It's only "The end" to you because you simply don't understand. I accrue more interest on my money while I wait for the bill and receive an additional percentage off of every purchase simply for using a credit card. I pay less than you for everything. I also earn free money for buying the exact same thing by holding my money longer in my bank account and in rewards given by my credit card company. Let me guess, you think getting a huge tax return is great, right?

 

[Doctor Nyse]

Originally posted by: eldorado99
I've never understood the people who don't use credit cards based on the fact that they think they will screw up and end up in debt. Are they unable to keep track of how much money they actually have in the bank? For example "I want a new TV, I do not have $1000 in the bank, but my credit card will pay for it!".

I will also never understand people who get a credit limit increase and go blow a grand or two because they think it means they have more money, do they not realize they are going to get a bill in 3 weeks asking for the money they just spent?

EDIT: By no means am I claiming to be a strong willed person, far from it most of the time, this is just something that has always been a no brainer to me.

I'm not at all worried about debt, as I've already stated I really do not like the idea of spending money I do not have. Unexpected purchases happen, you know... maintaining a bank account as if it were just cash forces you to control your intake - for lack of a better term - and if something comes up then I know I've already made choices that won't hit me hard at the end of the month.

 

[Capt Caveman]

Originally posted by: Doctor Nyse

Originally posted by: MrDudeMan

Originally posted by: HardcoreRobot
credit, for all the reasons listed above

Debit card... I only spend money I have at that exact moment

me too, except with a credit card...

ha, me too. It's amusing that people think they are being smart with statements like that, but I've never spent a penny I didn't have and the only thing, literally, that I buy on my debit card is food from Sams because they won't take my credit card. That's it. In almost 4 years, I've paid $0.00 in interest and earned a little over $1,500 in rewards for money I had to spend anyway.

It makes no sense to use a debit card unless you absolutely have to like I mentioned above. No sense at all.

Well the difference is that you pay a bill at the end of the month. I pay for what I purchased at that exact moment.

The end.

And by paying with a credit card, you can get between 1-5% back on your purchase and b/c you don't have to pay the bill to the end of the month, you make interest by keeping your money in your bank account til the end of the month.

 

[Doctor Nyse]

Originally posted by: MrDudeMan

Originally posted by: Doctor Nyse

Originally posted by: MrDudeMan

Originally posted by: HardcoreRobot
credit, for all the reasons listed above

Debit card... I only spend money I have at that exact moment

me too, except with a credit card...

ha, me too. It's amusing that people think they are being smart with statements like that, but I've never spent a penny I didn't have and the only thing, literally, that I buy on my debit card is food from Sams because they won't take my credit card. That's it. In almost 4 years, I've paid $0.00 in interest and earned a little over $1,500 in rewards for money I had to spend anyway.

It makes no sense to use a debit card unless you absolutely have to like I mentioned above. No sense at all.

Well the difference is that you pay a bill at the end of the month. I pay for what I purchased at that exact moment.

The end.

It's only "The end" to you because you simply don't understand. I accrue more interest on my money while I wait for the bill and receive an additional percentage off of every purchase simply for using a credit card. I pay less than you for everything. I also earn free money for buying the exact same thing by holding my money longer in my bank account and in rewards given by my credit card company. Let me guess, you think getting a huge tax return is great, right?

I'm not an idiot... I understand how your rewards work. It is not hard to grasp the fact that you gain a certain percentage on each purchase you make with your credit card. For the last time... I deal with my money like it was cash. No errors arise. I'm okay with foregoing cash back if it means I don't have to pay yet another bill at the end of the month. Tax return? I don't pay income tax. Constitutionally.

 

[MrDudeMan]

Originally posted by: Doctor Nyse

I'm not an idiot... I understand how your rewards work. It is not hard to grasp the fact that you gain a certain percentage on each purchase you make with your credit card. For the last time... I deal with my money like it was cash. No errors arise. I'm okay with foregoing cash back if it means I don't have to pay yet another bill at the end of the month. Tax return? I don't pay income tax. Constitutionally.

Wait, so you understand that you are giving up free money and you do it anyway? That's even more idiotic, honestly.

Does it really stress you out that much to sign online and click "pay bill now", which takes less than a minute? Yeah, that minute of my life once a month definitely isn't worth $1,000+ dollars every year. :roll:

Oh, and as far as your "unexpected purchases" goes...how does that have anything to do with this? If you live paycheck to paycheck, I can see this being a problem, but if you are able to save anything at all, it is absolutely stupid not to use a credit card whenever possible.

 

[MrDudeMan]

Instead of paying several bills, I prefer to pay all of these with my credit card and condense them into a single bill. It also saves me roughly 3% by paying them with my credit card.

Electric
Gas
Cable
Internet
Homeowners Association Fees
All food (except Sams)
All gasoline
All random purchases


So at the end of the month, I pay my credit card bill(s) and the mortgage. Two bills and I make over $1,000 a year (as I said in my previous post) for paying for this stuff on a credit card. I had to buy it anyway, so it would be idiotic to NOT do this. We save over 50% of our paychecks and we don't really make that much money, so it's not like the credit card is a free ticket to buy whatever the hell we want. With some diligence and common sense, a credit card is a free paycheck for you for things you had to purchase anyway.

 

[OrganizedChaos]

credit. always better to spend OPM

 

[caivoma]

I use credit card for most my purchase and always pay off in full every month. I dont use my credit card that much though.

 

[Schfifty Five]

These threads always pop up every few weeks and it's always interesting to see people's logic/mindset on why they use which.

If you are somewhat responsible with your money, there is no question/doubt that you should use a CC.

Who cares if you are paying immediately or 20-30 days later. If you know how much you have and are financially responsible, then CC will give you more back in the end.

 

[sandorski]

Debit---simply because my Bank Card is my Debit Card.

 

[alkemyst]

Originally posted by: RossMAN
Credit card and here's why:

--

I pay for everything on my credit card except for small purchases (under $5) and rent.

Why?

• Rewards, perks, incentives, no annual fees, etc.
  Would you turn away free money?
• The usual card benefits including but not limited to free 1 year extended warranty, 90 day returns, 90 day damage and theft protection, Car Rental Loss and Damage Insurance, Travel Accident Insurance and more!
• I get a nice itemized statement every month and one payment to make per cc.
• Credit (and debit) cards offer no liability protection against unauthorized transactions.
• It helps establish and maintain an active and healthy credit history.
• Again would you turn away free money?

Off the top of my head I charge car insurance, utilities, cell phone, internet, magazine subscriptions, lots of web hosting, etc. all to my credit cards.

How much do all these benefits and rewards cost me? $0

Make sure you have a credit card which has no annual fee and pay off your balance in full every month.

Last night I took my wife out for dinner which was charged on my Amex TrueEarnings earning a 3% cash rebate

Exactly....I have a few balances I carry and have been paying down. However; reward and cash back really adds up. Also some cards come with special offers that you can't get otherwise.

I love the idiots that respond to 'Credit or debit' as "debit, and try to explain how they don't need credit".

Credit is also safer definitely. Much fraud happens from servers/cashiers copying credit info down. Especially in places that ask to see your ID.

Never let anyone know your SS#/even the last four for a debit/credit transaction.

While some claim their debit offers protection, unlike CC's usually with a debit fraud you must report it within 24 hours of it happening. Also they will freeze your BANK account on a debit fraud many times. I had a debit card stolen from my mailbox, freaking was a PITA even though nothing came through on it.

 

[Special K]

So for all of you touting the benefits of being able to use the CC's money interest free for the duration of the grace period - do you pay the CC off directly through a savings account, or do you transfer the funds from savings to checking? Is there a wait time for the transfer?

 

[child of wonder]

CC for me.

Everything that we spend on it gets deducted from our checking account and put into a high interest online savings account. When the CC bill is due at the end of the month, I deduct that much from savings to my checking and pay the bill in full.

We end up earning almost an entire night's hotel stay every month on the CC plus ~$15 in interest from the cash sitting in our savings for a month.

Then we use the hotel stays for unexpected trips or save them for a week long vacation every summer.

 

[nageov3t]

I use my CC except for small purchases (groceries, gas, etc)

 

[MrDudeMan]

Originally posted by: Special K
So for all of you touting the benefits of being able to use the CC's money interest free for the duration of the grace period - do you pay the CC off directly through a savings account, or do you transfer the funds from savings to checking? Is there a wait time for the transfer?

My credit card is paid through my checking account at a different bank. My main credit card is through Bank of America and my checking account is at Chase. The transfer takes a day or so, but I don't see why that matters. The bill is due every month on the 20th and I start the transfer on the 19th. If it took longer than a day, it counts the day you started the transaction as the day it was paid, even if it takes another 5 days to completely transfer. If you were really paranoid, you could initiate the transfer 3-4 days ahead of time and be free of any worry, but it really isn't a problem. I've been doing it this way for almost 4 years and never had a problem, even when the payment is due on Saturday, I submit the payment on Friday, and it doesn't post until Tuesday - still pay no interest as Friday was counted as the date of payment.

My only savings account is an online account that gets 6%. I keep enough in my checking account to cover most emergencies, but if I really needed money immediately, I have 25k in credit card limit with 8k immediately available for cash withdrawal. There is no need for me to need access to my savings 24/7, so I keep it in a high yield savings account that takes 1-2 days to withdraw from. No big deal.

 

[daggerr]

Credit cards all the way. If you are disciplined with your spending, then you might as well earn free cashback, etc.

 

[Staples]

Debit cards. I hate banks enough not to want to make them rich.

 

[RossMAN]

Originally posted by: Staples
Debit cards. I hate banks enough not to want to make them rich.

How are you making the banks rich if:

1) You don't pay an annual fee.
2) You don't pay a penny in finance (interest) charges?
3) They pay you up to 5% in rewards including an extra year of warranty coverage for free?

 

[Auric]

Habitual "deadbeat" in the upside-down world of credit... I exploit it and always settle the balance monthly.

Debit cards sans benefits are even more e-vil than credit... just 'nutha step to a cashless society and a friggin' chip implant.

 

[fuzzybabybunny]

I can't understand for the life of me why anyone would NOT use a credit card if they can pay on time and control their spending. Bill condensation, perks, cash backs, time value of money, simple rudimentary finance.

 

[alimoalem]

Originally posted by: Doctor Nyse
Debit card... I only spend money I have at that exact moment

this, along with all the other similar posts debit card users post really get me to wondering how low AT has gotten lately.

1. those that treat their debit cards like cash, news flash: you can DO THE SAME with your credit card.
2. cash back actually means you get cash back.
3. those thinking only CC companies are out there to screw you, have you ever gone negative in your checking account? btw, often times people get their credit cards from banks, making the place they hold their money and advance credit from the same place. so saying "i don't want a CC company just waiting for me to make a mistake" is completely idiotic. it's the SAME place.

there are just so many benefits to using a cc instead of a debit card and i really see no positive to using a debit card over credit. the only time i use a debit card is when:
1. credit cards aren't an accepted form of payment
2. they charge extra for credit cards
3. my credit card magnetic strips are really worn so they don't work at the places with less sensitive swiping machines.

 

[konakona]

grrr. Just got hit by another overdraft fee cuz my x-roomate forgot to pay for the bill he was supposed to handle from this month on.
This hasnt happened often, but when it does really makes me cringe.

Luckily, I should be able to apply for a cc once I get my SSN sometime next months I hope.

 

[PhoenixOrion]

Credit card

for protection, and for the rewards.

 

[sandorski]

After reading the comments, it struck me that this question would be a good one for a longterm Study. Just to see if everyone's comments remain true and/or to compare the 2 groups on which has more/fewer Financial issues or other such discrepancies that may exist.

It just seems to me that the CC side who "always" Pay their Balances are likely to occasionally have situations beyond their control where they can not do so. Do they recover? Do they lose their Benefits if/when they fail to Pay off in full?

On the flipside, what's the longterm results for the Debit Card user?

I suppose such a study would be very difficult, since the Majority definitely have CCs and the Debit Card exclusive person is likely a small group, but since many seem to have strong opinions on the subject, it would be interesting to know if those opinions hold water or not.