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Discussion in 'The OT' started by phrelin, Dec 13, 2009.
DEBIT card all the way here...
Well, yes and no. If you'll notice, most of the above state they pay the balance off in full every month which is what I do. So, in effect, we're using CCs as plastic cash; using the CC for convenience and rewards, but spending within our limits as if we were using cash and not giving the banks much in return.
I think the premise is Credit vs. Non-credit, not strictly vs. Cash. The article seems to be lumping all "non-credit" payment methods such as cash, check and debit together. Overall, they say that credit purchases are on the decline.
I would guess that the largest portion of that decline would be to debit card use.
I guess you could look at it that way. I'm just saying that I see very little [real] cash use when I shop. To me, using my CC for all purchases and paying it off is still using a credit card to pay for purchases. I may not be using the the financial credit available for long but I'm still using it -- just intelligently.
You could be right but the title of this post, specifically raised the question, "Cash replacing credit card use?" Also, just because I'm paying off my credit card each month to avoid paying interest doesn't mean that:
I'm not using "Credit". I certainly am, I'm just paying the balance before they charge me. But for the time between my purchase and paying the bill, I certainly am using their money.
I'm using cash
If the writer actually meant that use of cash is increasing, I just haven't seen it (I know what I see may not be representative) and in our little sample, it appears that only a few are actually taking cash from their pockets when making purchases. A few additional people are using debit cards as well too but the majority here (and from what I see) are using CC's.
Oh well! Interesting discussion. As I said in my first post, "People will do what meets their needs the most. "
Watching CNBC this morning one investment bank raised the target on Visa, they said the number of transactions and the amount on each had gone up last month. Guess not everyone is getting rid of plastic.
I almost never use cash. It's rare when I have more than $20 in my pocket. I don't use "credit" cards,though. Instead I use AMEX which is a charge card and gets paid in full each month. Because of its annual fee, I had tried doing this with various Visa/MC branded accounts over the years, but they all seem to find creative ways to stick me with fees by doing things like changing the statement cut-off and due dates each month, etc. With AMEX,m I know what my due date is each month so there are just no games.
As for debit cards, I do carry one because that's all my bank issues I don't like it, though, and almost never use it. The problem with debit is that if your card number get stolen, there are less protections. While the bank may eventually credit you back for the fraudulent charges, in the mean time, you have to worry about your account being overdrawn or even having it frozen while the bank investigates. With AMEX, there are no worries like this at all.
Yup. Basically use a Mastercard that gets paid in full every month. I also have an Amex for use at Costco that also gets paid off every month I charge something on it. My wife has an Old Navy card that she uses when shopping there as it usually gets her free shipping, but we also pay that off anytime we charge something.
It's not that they are changing the cut-off and due dates on you, it's how their cycle works. Most credit cards work on a 30 day cycle, so if the month doesn't have 30 days, the due date and cut off dates can change from month to month.
No, I actually had a card where I had been paying it off in full each month for over a year. The cut-off date was always the 20th (give or take a day based on days in the month as you mentioned), and the due date as the 15th (again, give or take). Over the period of about 6 months, the cut-off date "migrated" to the 15th, and the due date the 25th. This gave me 10 days to get the bill paid. This was in the days before online payments were an option so I had to be very quick to get a check in the mail not to get hit with late fees. Of course they would take a "check by phone" for a $12 fee! Basically, they were doing everything they could to make sure they made some money on me. That's why I just went back to using AMEX. I've had The Card for almost 20 years and never had any games like that. In fact, there was a time when I was spending voer $10K/mo traveling,a dn my employer was not terribly quick to remimburse me, so AMEX even let me go 45 days on payments with no problems.
Yeah, the thread title is a little different than the what the article is actually stating. The first line of the article merely states the trend this year for holiday shopping, the rest seems to be conjuecture about what the future may hold.
I think it's only natural that credit transactions would fall off during bad economic times when people are trying to avoid incurring any unnecessary debt. When/if the economy starts a "real" recovery, I think it's safe to assume the trend will reverse itself.
For all the folks that "only " use a debit card-Which is fine, just be aware that should your "number" ever be Stolen, it can and will be used as a credit card for (no pin) transactions on your account and unless you carry a large checking account balance it can be drained very quickly before you may be notifed of it misuse, making possible bounced check charges and other fee's piled on.
Yes-Debit cards are protected, the process for putting the money back (into your account) will take a lot longer than a Credit card (credit) and if your between paychecks when it happens you can be tied up for a long time.
Check your banks policy on how Debit vrs credit is handled by them- you may be very surprised at what the difference is.
Your Card numbers could be copied right now without your knowledge and just haven't been used yet. Never let your card leave your hand-, never store your card on any web server.
Like most folks here I use one CC and pay it off monthly, I only use my debit card for atm quick cash (walk around money).
I thought the article was speculative. But we do know from published statistics that people are carrying lower balances on average. Of course, we know from other articles and posts in other threads here that many people are angry at their card company for increasing rates and fees while lowering credit limits, and even canceling cards. That anger translated into some customers canceling cards.
We use two cards that pay at least 1% cash back and sometimes as high as 5%. We pay them off every month. But it represents a slightly lower grocery bill, Dish Network bill, gasoline purchases, etc. and is almost the same as "cash." And there are some security advantages over debit cards or even cash.
There was a time that credit card interest was deductible. It was a trap we fell into, and it was painful when Congress eliminated that. Between state and federal tax rates at the time our interest rates were effectively reduced by about 40%. We couldn't just pay off all the balances, so our spendable income dropped.
You just have to be careful with plastic and keep an eye on the rules. It's better to not learn this the hard way.
One credit card here, balance paid monthly.
I personally dont use cash and I dont see any increase in cash usage around me, but as to my personal usage while I still unfortunately owe balances I am making a point to pay it down. I monitor each month and try to make sure my payments are more than purchases and interest. Gas cards are pay in full every month. So while I am using credit I am effectively paying for everything I buy that month and paying down the balance.