Credit Card and/or Cash?

[Dsanders 5,747]

I've been studying and doing a bit of research in financial planning lately. I've recently came across a lot of articles that claim that although going without using a credit card is more difficult and requires some planning and establishing good savings, it is a much better option than having to rely on credit card to cover your expenses. 

 

I am still no expert on the fundamental economics and finances that comes into play here, but that's why I decided to post this topic. To gather some of your thoughts. A good majority of the community here is composed of adults ranging from their early twenties to thirties, with a whole lot of experience in the economic world where balancing budget, personal finances, and savings is a real necessity. 

 

So I'd just like to know your guy's thoughts on using only cash as opposed to using credit cards or both. Like how does one balance that out? How do you handle your credit and finance?

[Skylar 1,641]

I purely stick to my debit card / cash at the moment, since debit cards dont allow you to go below zero  I have no real expenditure at the moment so any advice from me is useless though x3 

[FlitterFlutter 1,583]

Well i can not help you out too much but I will tell you that I only use cash unless I much use a card for online things. 

[Mawile303 17]

Credit cards are perfectly fine to use as long as you are financially responsible. I have two credit cards that I use frequently, but I always make sure to zero out the balance on each of them at the end of the month. In doing so, I am building up my credit score while having zero debt. A good credit score will make banks more likely to approve you for loans should the need arise.

[Stormbringer 346]

I prefer to use cash. I plan on only using a credit card and having a bank account for savings and depositing work checks.

[Lateon 589]

I've always been taught that using a credit card is an extremely easy way to get yourself in some deep shit. So, my mom got me a debit card that's connected to her bank account, which means she can move money into and out of it at will. I haven't had to use it much outside of online transactions (buying things from Newegg, humble bundles, getting myself riot points, etc.), but the option's there if I need it.

 

I primarily use cash to pay for things we get delivered to our townhouse - chinese, pizza, thai food, things like that.

 

I've never written a check, and I don't plan on ever getting a credit card.

[Fluttershyfan94 5,742]

For me personally I use both, lately I have been using a debet card but often I withdraw a certain amount from an ATM not too much but that way each time I withdraw I have a better view over my spending. When it comes to using a credit card you sort of loose sight of that and end up spending too much. So what I do is just go to the nearest ATM withdraw some amount of money and try making it last the week or month. The best way to see where you stand is by having physical currency but of course it doesn't matter as long as you're financially responsible then there is nothing wrong with using a credit card I just prefer having physical currency that way you know what you have.

 

So, I'd say cash though I use both.

Edited January 19, 2014 by Fluttershyfan94

[MLPForums Phanact 1,374]

I always say use cash or debit, never credit.

 

If you can't afford to buy something outright then just don't buy it. There is no need to have a credit card, they're just a horrible temptation that leads to nothing but debt. I'm never, ever getting a credit card.

 

It all boils down to patience. I had a real trouble trying to get my bank to remove the $10 overdraft on my debit card. They almost flat out refused to do it at one point.

Edited January 19, 2014 by Essy*

[Scootalove 10,689]

I've been taught that it is better to use both just in case, if you are out of money then you can resort to using a credit card. It goes both ways if your credit isn't high, then you can use your own cash. I'd prefer to use both.

[LunarWave 106]

Just my 0.02$ 

 

I find that it's emotionally much more easier to spend more than you can actually afford to spend if you use cards (no matter what type) than with cash. 

If money are not physical - you dont really feel anything when parting with it, and more likely to spend money on useless junk or things you would not have bought otherwise. This includes not only cards, but also any kind of currency - bitcoin, bank accounts, paypal, store credit, whatnot. 

[Dsanders 5,747]

 

 

I have two credit cards that I use frequently, but I always make sure to zero out the balance on each of them at the end of the month. In doing so, I am building up my credit score while having zero debt.

 

Wow really? How exactly does one zero out the balance on a credit card? Sorry, I'm really novice to understanding credit, banking, and finance.

 

 

 

financially responsible

 

Care to elaborate? Like what does being financially responsible mean exactly? In your own definition at least.

 

 

 

I had a real trouble trying to get my bank to remove the $10 overdraft on my debit card. They almost flat out refused to do it at one point.

 

What happened? If you don't mind me asking that is. 

[MLPForums Phanact 1,374]

What happened? If you don't mind me asking that is. 

 

I told them that I'd cancel my bank account with them and move to a rival branch. They didn't like that and quite hastily removed the overdraft.

 

The only reason I'd ever get a credit card is to get a mortgage on a house. They usually check your credit score over here for a mortgage and having no credit score is just as bad as having a low credit score.

 

A good way to make your credit score rise is to make lots and lots of tiny purchases and then pay them back almost immediately. (:

[Fluttershyfan94 5,742]

Care to elaborate? Like what does being financially responsible mean exactly? In your own definition at least.

 

To not spend more then you can afford spending.

[Dsanders 5,747]

I told them that I'd cancel my bank account with them and move to a rival branch. They didn't like that and quite hastily removed the overdraft.

 

The only reason I'd ever get a credit card is to get a mortgage on a house. They usually check your credit score over here for a mortgage and having no credit score is just as bad as having a low credit score.

 

A good way to make your credit score rise is to make lots and lots of tiny purchases and then pay them back almost immediately. (:

 

Sounds like your bank was a little jealous. lol I'm sorry that you had to go through all that trouble.

 

I've heard a lot about the mortgage benefits that come with having a credit card. It's also a lifesaver when it comes to healthcare and if you want to go any special vacation for the holidays and such.

 

Also, is there a way to establish good credit without using a credit card? Also in regards to where I made bold, care to elaborate there? Are you talking about loans? And who's them?

 

 

 

To not spend more then you can afford spending.

 

Ah well that makes sense. Yeah I can imagine that not having a credit card on you everywhere you go relieves you of any temptation to make purchases that you will regret later on.

[MLPForums Phanact 1,374]

Sounds like your bank was a little jealous. lol I'm sorry that you had to go through all that trouble.

 

I've heard a lot about the mortgage benefits that come with having a credit card. It's also a lifesaver when it comes to healthcare and if you want to go any special vacation for the holidays and such.

 

Also, is there a way to establish good credit without using a credit card? Also in regards to where I made bold, care to elaborate there? Are you talking about loans? And who's them?

 

Healthcare is free in the UK so I don't really need an 'In case of emergency' credit card for that issue.

 

I'm talking about having a credit card and buying lots of small things like maybe some games on Steam or using it buy some snacks etc. and then paying the money back into the bank account. It shows that you are able to quickly repay money.

 

Them is just the bank. That's who you're borrowing money from when you use a credit card AFAIK.

Edited January 19, 2014 by Essy*

[~Silver Essence~ 2,625]

I stick with whatever fits better for either more bonuses or advantages.

 

For example, I'll stick with debit when I just need it taken care of quickly at the nick of time, while I also do credit to gain the extra value for more stuff rather than the normal cash credit.

[Dsanders 5,747]

 

 

while I also do credit to gain the extra value for more stuff rather than the normal cash credit.

 

What do you mean by gaining the extra value? 

[~Silver Essence~ 2,625]

What do you mean by gaining the extra value? 

Ever been to gamestop and other retail stores?

 

What I mean is if let's say you do a trade or cash in on whatever you buy or sell, you can choose to get cash from it, or get credit, but credit often gives you more than regular cash, as most retail stores give you bonuses like 20% off or a $10 off deal if you go with it.

 

Hope that made it more clear pal.   

[Adente 1,000]

I've been studying and doing a bit of research in financial planning lately. I've recently came across a lot of articles that claim that although going without using a credit card is more difficult and requires some planning and establishing good savings, it is a much better option than having to rely on credit card to cover your expenses. 

 

I am still no expert on the fundamental economics and finances that comes into play here, but that's why I decided to post this topic. To gather some of your thoughts. A good majority of the community here is composed of adults ranging from their early twenties to thirties, with a whole lot of experience in the economic world where balancing budget, personal finances, and savings is a real necessity. 

 

So I'd just like to know your guy's thoughts on using only cash as opposed to using credit cards or both. Like how does one balance that out? How do you handle your credit and finance?

 

Good question. Its good that you're taking an interest in your finances! So, first of all, credit can be good or bad. It allows you to buy things you can't actually afford, which can be good or bad. For example, most people don't have a quarter of a million dollars or more at any given time in their accounts, so most they couldn't really afford to buy a house. However, with good credit, they can take out a loan and buy the house anyways, and pay it off for the next few years. Same goes for a car. However, irresponsibility can lead to you buying more on credit than you can afford to pay for, even with minimal monthly payments. Therefore, exercise responsibility. To build up good credit, make small purchases with a credit card that you know you can pay off all at once when the monthly bill arrives. That way, you don't have to pay interest, (most card plans don't charge any interest if you pay off the bill in the first month) and build up your credit. Also, if you mainly use credit cards, it is easier to avert identity theft and reverse the effects then if someone stole your debit card and emptied your account. 

 

Always be very careful though when taking out a loan or getting a credit card to make sure you aren't penalized for making higher than minimum monthly payments, so that way you pay off the loan quicker and pay more to your principal and thus overall pay less interest. Does all that make sense?

[Shanks 10,816]

Credit cards can be very useful if they are they are used responsibly of course responsibly is the key word that a lot of people forget. Credit cards should never be used as a primary method of payment and should mostly be used for major purchases in which other payment methods would not be feasable and when making said purchases you should pay off the balance as soon as possible preferably before the interest kicks in. Alot of people stick to making minimum payments but that will only cost more money in the long run through interest and it is better to spend a bit more in the short term than to lose more money in the long run.

 

What I did when I first started out was I kept making small purchases with my credit card and paid off the balance almost immediately in order to build my credit rating. As I began to get better and better at budgeting and planning I made more purchases with my credit card until I developed a near perfect credit rating. Since I got my credit rating to a respectable level I have only used my credit card for major purchases like computers, video game consoles ect and in some cases even used my debit card on some major purchases if I could afford it. I rarely use cash but for most of my purchases tend to use my debit card.

[Deesinn 393]

I use my Visa with Aeroplan Miles for gas only.  I've paid for 6 flights with those points over the course of 6 years (Not including taxes), and I never carry a balance on that card.  

 

Otherwise, I keep cash on me.  I use my bank account to pay for my car insurance, cell phone, and my student loan payments.  Everything else I pay in checks (rent) or cash.  I have no move money around a lot, and I'd rather not pay 20 bucks a month for a bank account that let's me make unlimited transfers.     

[Envy 6,162]

I use a mixture of debit card and cash. Typically I use my debit card, because it's convenient.

 

I thought of getting a credit card and using it to get my oboe, because spending that much money out of my account at once freaked me out a little bit, but I didn't get a credit card fast enough, so that didn't happen. lol