Comments on: 4 Reasons You Should Use a Credit Card

By: Mark Shead

Mark Shead — Sun, 11 Oct 2009 20:58:42 +0000

@Roshan – Obviously if you don’t have self control a credit card can be a dangerous thing–of course so can a checkbook.

By: Roshan

Roshan — Sun, 11 Oct 2009 10:52:21 +0000

This post is an eye opener. Usually people think the other way round. Thanks for such a nice post.

By: Anthony

Anthony — Fri, 22 May 2009 07:46:16 +0000

Good points. Although I still stick to cash over any form of plastic (credit/debit cards) or paper (checks).

By: 14 Must-Have Online Banking Features : Productivity501

14 Must-Have Online Banking Features : Productivity501 — Fri, 15 May 2009 19:55:03 +0000

[...] Online Check Images – Most banks will show you an image of the check, which makes it really easy to balance your account if you can’t remember what a particular payment was for. (Ideally, you should minimize the number of physical checks you write to reduce fraud.) [...]

By: J.Chu | SuccessRevolution.com

J.Chu | SuccessRevolution.com — Wed, 13 May 2009 07:59:03 +0000

Great post !

One certain thing if we use credit card is pay the bill on time.

This will up our credibility in front of the bankers and they will increase our credit card grade which will give us more benefit and service.

Use when we really need it otherwise it can be a killer for our financial life.

By: Mark Shead

Mark Shead — Wed, 13 May 2009 02:29:11 +0000

@Andrew – I’m glad it worked out well for you. I have heard quite a few people who it didn’t work out for quite like that. It might be different for people who live in areas where fraud isn’t quite as common.

Even in you case the money was taken out of you account and had to be put back. With a credit card, the money doesn’t leave your bank account until you pay your bill.

By: Andrew

Andrew — Wed, 13 May 2009 02:13:38 +0000

“Let’s say someone steals your check book or uses the account number to withdraw money from your account. You notice the problem on your next statement and call the bank. You now have to prove to the bank that they need to refund your money and put it back into your account. The money is already gone, you have to try to get it back.”

Not true. I live in an area that has rampant fraud going on. I’ve had my bank call ME and tell me they think fraud was being committed. And they were right. I didn’t have to prove anything to anyone. I filed a fraud report and got my money back. My bank has also cancelled my card as an active step to protect me from shady vendors that came up on fraud alerts.

Not once have I ever had to prove to a bank that fraud was committed in order to get my money back. My experience has always been that they take the customer’s side.

Please get your facts straight. Thank you.

By: Julie

Julie — Tue, 12 May 2009 22:59:44 +0000

@Financial Peace: I’ve got to agree with Mark, above. So long as it’s managed and tracked properly, I think credit cards are at the same level of risk as debit cards. To me, “disaster hitting” is when you get your identity stolen, which is actually EASIER to manage with a credit card than a debit card.

At the moment, I use my credit card for online purchases that don’t accept direct payment through a bank’s website. This, I find, is one of the most useful purposes of a credit card and not really interchangeable with anything else.

By: Mark Shead

Mark Shead — Tue, 12 May 2009 22:36:04 +0000

@Financial Peace – If you track what you spend on a credit card it is no different than using a checking account. If you think that “when disaster hits” you might write bad checks then I agree–you shouldn’t use a credit card or a checkbook. So if you feel that writing checks is “like playing with snakes” I agree that credit cards fall into the same category.

As far as the rewards, it obviously depends on what card you have and how much you run through it each month. For some people it doesn’t make sense, but the math is simple to figure see if it will help you or not. It has worked out very well for me, but if that was the only advantage of using credit cards I’m not sure if I would use them.

The biggest reason I use a credit card though is because of the protection it offers that you don’t get with a debit card. For me this is very significant.

I recognize your point though. Credit cards aren’t a good choice for everyone. Checking accounts aren’t a good choice for everyone. You have to know your own weaknesses and decide if the advantages are actually helpful or not.

By: Financial Peace

Financial Peace — Tue, 12 May 2009 21:44:07 +0000

Cheeeeeeetah! Run!
It should be pointed out that using Credit Cards is similar to playing with snakes… You’ll eventually get bit, even if you, like me, paid it off every month (until disaster hits). It’s too easy for “disciplined” people to get hurt & I’ve seen hundreds of hurting people because they’ve bought-into the lie that it’s “safe”. I’ve found that my savings has grown much faster now that I use cash & checks… Watch what successful people do… Do “rich people” stuff, get rich! Do “poor people” stuff… you get the picture.

Lastly, the rewards programs VERY seldom add up to anything usable. It’s hard to cash-in the points & even harder to get enough to get anything you actually want (i.e. Spend $200,000 on your credit card, get a free trip).

Better choices: You can now get Debit Cards that give you points, if you have a specific, reachable goal in mind.

By: Positively Present

Positively Present — Tue, 12 May 2009 19:36:48 +0000

Good points here! I’m not that great with a credit card so I try to use mine just for groceries/gas/necessities. It seems to be working out well for me!

By: Wayne Holly

Wayne Holly — Tue, 12 May 2009 19:22:36 +0000

I use a credit card to pay for almost all of our monthly expenses and pay off the balance each month – no finance charges. I use our bank account’s bill pay feature as soon as I know the amount and due date so that I never chance being late.

I have a card that pays me a percentage back for my purchases, so why not get back some of the money that I am spending. Every time I have $100 in rewards, it is used to credit my account.

This system has worked very well for me for about the last 2 -3 years.

By: Mark Shead

Mark Shead — Tue, 02 Dec 2008 23:30:29 +0000

@Greg – If they have a hybrid card that can be processed as a credit card, but immediately pulls the funds from the account, would they have the same limit?

By: Greg Smith

Greg Smith — Tue, 02 Dec 2008 20:01:10 +0000

As a banker that deals with both debit and credit card transactions on a daily basis, there is a big piece that all of you are missing. Rarely will you find a bankt hat will allow a debit card limit over $100-$1500 because the bank is sharing int he risk of the transactions. The customer can dispute the transaction and there is a chance the bank can be stuck with the expense. On the debit side of the card we limit our exposure to $300 per day and on the credit side we limit our customers to $1000 per day. This is common for most banks. I’ve never know a bank to allow a $9000 debit card transaction. It is too high of risk for the bank.

By: Mark Shead

Mark Shead — Fri, 14 Nov 2008 00:05:55 +0000

@me – It sounds like you might fall into the group of people who don’t pay off your credit card every month and spend a lot more with a credit card than with cash. So you are right, credit cards may not be a good option for you.

If you did have financial discipline and paid off your balance every month, I think you’d see the benefits. As it is my points seem lame to you because you aren’t the target audience for this article.

My point with the $9000 is that when something like that does happen, a credit card gives you a buffer and someone who can “go to bat” for you.

Also consider that the risk of losing cash is much greater than a credit card. With a credit card, you aren’t out anything. With cash you are out whatever you loose.