I know this might just reflect financial culture differences across countries, but let’s give it a try
Edit: as a clarification, I meant credit card compared to debit, not to cash
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Use a credit card for every single purchase that will allow it. I have the Amazon prime rewards card, and we order our dog food and many household items from there at 5% cash back.
I acquire cash back and it goes towards the balance each month. I pay the balance in full each month, thereby reaping the rewards (free money) and never pay a cent in interest. Been doing this for years.
Another reason I do this is because I do not want my routing and account numbers online with any business.
One small breach of your bank account and your life savings can be gone. I’m not trusting any big business with that, not to mention the fraud protections other users have mentioned.
If you can exercise discipline it’s a no brainier.
Costco card here, but pretty much the same argument. Aside from the points/miles/cash back rewards, most also include some minor insurance/extended warranty/travel/etc. benefits. It’s kind of shitty because transaction fees just drive up costs for merchants, but from the user’s point of view the financially beneficial option is to use a credit card for ad many purchases as possible.
How are you liking that Costco card? We were considering switching to that actually.
In France, most of people don’t even realised that credit cards shown in american TV productions aren’t like our (debit) cards.
But that’s totally normal when you see someone paying with a card to assume that they have indeed pay, rather than assuming that they have indebted themselves despite being able to afford the product.If in the US, there is almost no downside to credit cards as long there’s no annual fee and you pay it off in full every month. Most credit cards have some kind of rewards like cashback, miles, discounts, etc., so you gain something from using them. Banks are also very strict with fraud (because it’s their money you’re spending), so they will most likely side with you if you file a claim for unauthorized purchases. If you used a debit card, it’s your money that gets stolen; and while the bank will try its best to recover it, they have less incentive to work for it compared to a credit card.
I used to limit myself to the card that didn’t have any annual fees. Practically all my purchases are made with a credit card (all paid back in full by the end of the month), so it turns out to be really worth it to take the card with the most advantages and highest cashback rates. They pay me back the yearly cost of the card many many times over.
The catch is, if the amount of transactions starts to drop below a certain threshold, it might not be worth it anymore.
Note that I am in Canada, not the US. Not sure if that makes any difference here.
I think US cards tend to have better rewards than Canadian ones, but echo on the fees thing. If a person is spending $1000/month on their card(which isn’t much once you put all your utilities/gas/grocery/etc. purchases together), and youre getting a 1% cash back/reward, that’s $120/year worth of rewards. So depending on your yearly spending, it can be worth paying that annual fee to get a card with better rewards.
I use a credit card because our laws in the USA protect credit-card purchases better than they do debit-card and other electronic purchases.
Although I use a credit card with revolving credit, I always pay the full balance each month. In this way, it acts as a debit card, but I get the benefits of a credit card. I have to remember to pay it on time, but I can set up autopay even for that.
My credit union (a kind of non-profit bank owned by its members) is the issuer of the card, and it gives a 2% cash award for credit-card usage.
In the UK, as long as you are able to track your finances well enough to ensure you repay the balance in full each month (you can arrange for this to happen automatically), there’s no reason not to use a credit card.
You should especially use it for purchases over £100 as by law card issuers are jointly liable for problems with goods purchased, so if I have a warranty issue the retailer won’t help with I can go through section 75 with my bank
I have never purchased something on a credit card and had it on the balance long enough to pay interest though, the rates are insane.
Plus, some cards give you points. Which can later be used for things like upgrades on flights.
This is exactly what I use mine for, and I’m trying to convince my wife to do the same. We’ve had to buy some relatively expensive things for the house recently, so I’ve been using the credit card for the extra protection, while she’s been paying in cash / debit card.
Luckily, we haven’t had any major problems yet, but she doesn’t seem to understand that the extra protection is worth it.
Honestly I’ve found that women have a different relationship with cash. It feels safer, more secure, it’s tangible - I don’t think that translates to credit so well. Just my experience however.
In Europe they are basically featureless, and the only people I have seen using them were those who struggle with consumerism.
I use a prepaid credit card. Same benefits, more control over my money :)
