Debit vs. Credit Cards

[RSKY]

Told this story before on here.

When each of our daughters started driving we gave them a credit card to use for gas and ESSENTIAL purchases. They never abused this to my knowledge. And I checked each month. Both got their college paid for by getting good grades in school and receiving scholarships, etc.. So I really didn't worry about it.

BUT!!

For our anniversary one year the youngest announced that she was taking us out to a very good seafood restaurant. She actually wanted to drive two hours to her favorite steak place but we declined that. So we go and have a great meal, desert, and when they brought the bill she asked us how much to put on the tip. And, as you have probably guessed by now, she whipped out that credit card to pay the bill.

Grinning all the time.

RSKY

 

[RSKY]

We have a total of eight credit cards.

Sam's Club Mastercard gives 5% back on gas, 3% back on restaurants, and 1% back on everything else. We use this one the most. We shop a lot at Sam's Club and get this money back on purchases there, sometimes getting our entire store purchase without extra expense.

Fidelity Visa gives 2% back on every purchase straight into my IRA.

Discover Card used for all online purchases. Every three months they change what purchases you can get 5% back on. Currently it is 5% back on all Amazon purchases. January thru March it is at grocery and drug stores.

Lowes store card gets 5% off at the register and sometimes they run specials for more. I can currently get 10% off one purchase.

Three of the other four are store specific, Kohl's, Old Navy, Home Depot, and the last is an American Express used only at Dillard's. Each of these give changing discounts that my wife keeps up with and uses to buy clothes, shoes, gifts, and other stuff for grandkids. She gets very large discounts by keeping up with specials offered if you use the card for the purchase.

We use our cards for nearly all purchases and pay them off each month. All the bills are set up so they can be paid on the tenth of each month. I sit down at the computer and call up the spreadsheet I use to track monthly bills. And I pay everything off. We NEVER carry a balance!

Our credit score did drop thirty points when the retailers cancelled two of our cards for non use. But it did not bother us. We don't intend to borrow money at our age.

IF you use the cards to pay for normal everyday purchases and not for short term loans you can help your finances more than you think. BUT you must not carry a balance. Pay it off every month. My wife worked with teachers that would take a credit card and go to a store and load up on clothes and other junk that they didn't need just because it was on sale. Then carry a balance for months trying to pay it off. Stupid, stupid, stupid!!!

RSKY

 

[MossRoad]

Here's another reason that I prefer credit cards. Last winter I noticed that a convenience store downstate had placed a "hold" of $175 on the card I use for my truck. It didn't make any sense; I had indeed bought gas there 2 weeks previously using that card, but they had already been paid. I called twice and sent an email about it, but never could talk to anybody about the hold. I checked my account every morning for over 2 weeks, waiting to see if I was going to have to protest the charge. Finally, it came off, and I never did find out what was going on.
It was a lot easier having that hold against my CC than it would have been against my checking account.

When we do hotels, we know they're going to put a hold on the card until the transaction clears. It's never been an issue.

As for them waiting weeks and weeks to clear it, that's odd.

 

[Oaktree]

How old are you. credit card booths sound like my college in the eighties, except no warnings of the risks

Never heard of such a thing, granted I was in college in the late 60s when credit cards weren't that common, and few companies would issue one to someone under 25.

 

[Torvy]

@RSKY would like to 'Like' your post multiple times.

We don't do store cards except Kohl's as they give extra discounts as wife goes there frequently.

We set up autopay through our bank so we have full control, but even if we forget, the bills are paid in full. We used a card for U promise that helped our kids with tuition. Money could go directly into a 503c. They each got upwards of 4k from that.

We also use a Discover for recurring payments. We got burned a few times by using the same card for everything and if a number gets compromised, changing recurring payments is a PITA. Now that card just does one function.

With kids grown, we switched U promise to a Savor card by Capital One. Lots of cash back on things we use like groceries and dining. We don't travel much or we would have done the Venture card instead.

No fees, no interest. The baked-in price costs are paid by cash and credit customers alike. Unless you have trouble controlling yourself with spending, it is considerably better to use the cc.

 

[Torvy]

Never heard of such a thing, granted I was in college in the late 60s when credit cards weren't that common, and few companies would issue one to someone under 25.

I worked for what was then the largest CC issuing bank in the world in the early 80s. Marketing targeted college students because most people are loyal and don't tends to switch banks or CC companies lightly. Typically, those cards had low limits, but helped kids get established credit, but some fell on their faces.

 

[Jstpssng]

When we do hotels, we know they're going to put a hold on the card until the transaction clears. It's never been an issue.

As for them waiting weeks and weeks to clear it, that's odd.

What was even more odd was that they put on the hold in the first place. Not only was I driving a Colorado, with a 20 gallon tank; but they already had been paid, two weeks before the hold was put on.

Here is the actual email which I wrote to the company on April 14 of this year.

Dear Manager

On March 28 at around 2:08 I purchased gas at your store, totaling $59.28. That sale posted to my credit card and has already been paid.
Last Saturday (April 9) I noticed that another charge, in the amount of $175, was pending on that same card on the same day, for a sale just 2 minutes earlier.
For 5 days now that status hasn't changed; it still shows up as "pending" so I am not sure whether you plan to try to collect that money or not.
I contacted the retail store but of course they were unable to do anything; and at 4:00 Saturday PM she most likely had customers to tend to.
She did say that she would send an email to you about it.

Would you please tell me what is going on with this charge? I drive a Chevy Colorado with a 21 gallon tank... there's no way that I pumped 235 dollars worth of gas into it that day.

Thank you

I believe that it was another week before the "hold" was taken off.

 

[Yander]

Lowes card is a no brainer, I buy nothing there without using the Lowes card to get the 5% off. We use other store cards too... Kohls, TSC, HD and Good Year. Good year will sometimes give you a $100 gift card if you buy 4 tires and use their store card. Though I now buy tires from Amazon or Tirerack. We never carry a balance and use their discounts to our advantage. If you cannot do that, you shouldn't use a card because they will use you to their advantage.

 

[beowulf]

How old are you. credit card booths sound like my college in the eighties, except no warnings of the risks

I will be 79 in February. Went to college 1962-66. When our daughters went to college there were no warnings either - just promotions. The warnings had to come from us.

 

[two_bit_score]

My Dad was very old fashioned when it came to credit cards. He was completely against having one. Guess that was from growing up in the Great Depression and seeing people truly out on the streets because they could not pay accumulated debt. That doesn't seem to happen as much now. Dad would keep cash money in a coat pocket in the closet for Mom to use for whatever she wanted or needed and he kept it replenished. She never went without.

My Mom wanted to get a BankAmericard when those came out. Dad finally relented. It was funny because she finally got to use it and the 'new' wore off because she had to write a check to pay the bill when it came and she soon just quit using it.

When I got married I had an account at a local store which had a Hardware department, Home Goods, Appliances and furniture, Service Department, etc. About the only thing they didn't sell was tires and auto. The account was "30 days, same as cash" and a revolving account after 30 days but I never exceeded 30 days. I actually looked forward to getting their bill and stopping by the office to pay it. Very seldom put the payment in the mail. At first they asked me to sign the ticket as I checked out but pretty quick they dispensed with that and I just showed them what I got and kept walking.

We had a nice department store that sold quality clothes and they did the same thing. Finally in about 1975 SEARS talked my wife into a credit card. We still have it and some bank services it but we haven't used it in a few years. Now we have multiple CC's, multiple banks and multiple accounts at those banks. Everything gets paid off every month and we haven't had any debt in at least 12 years when I bought a truck and financed it just to get a discount and some freebies from GM Fleet and paid the rest off about 2 years after buying it.

My wife deposits checks by taking a picture with her phone. I won't do that because I like to go to the bank, have coffee and talk and cash my checks when I have time.

I sure would like to go back to the old days. It was just more fun.