Going checkless and no credit cards

[IndyColtsFan]

Misfortune because their freezer or fridge went out and they had to use a credit card to replace it?

If they didn't have a credit line and that happened, guess what?

Misfortune because their out of a job, savings depleted and the motor goes out in their car?

Ever hear of savings? Unemployment can happen to anyone and that is the exception, not the rule.

Misfortune because their child is sick and the hospital / doctor wanted a payment before their seen?

Again, this is an exception, not the rule. For the most part, people should be saving money before they buy plasma TVs, new cars, etc.

Sometimes its not related to being "irresponsible",,, sometimes people are just down on their luck.

How is that the credit card company's fault? If they didn't use a credit card, what would they do?

 

[Texashiker]

How is that the credit card company's fault?

Maybe a good term is predatory capitalism?

Someone is already down on their luck, need money for something and end up paying 22+% interest.

If they didn't use a credit card, what would they do?

Seek other lines of credit with a lower interest rate.

Credit cards are easy to use, so when people need money, credit cards are often the first things people turn to. The high interest rates and late fees are often an after thought.

Why am I explaining this to you? You should already know it.

 

[alkemyst]

It's funny the OP is from Texas. They had banned HELOC's/Home equity lines in the state due to the people coming forward in a class action that they didn't know their house was the collateral.

I am finding more and more people in Texas can't manage their own finances.

 

[OILFIELDTRASH]

It's funny the OP is from Texas. They had banned HELOC's/Home equity lines in the state due to the people coming forward in a class action that they didn't know their house was the collateral.

I am finding more and more people in Texas can't manage their own finances.

WTF are you talking about? We are like the least affected state in the U.S. when it comes to the economy.

 

[IndyColtsFan]

Maybe a good term is predatory capitalism?

Someone is already down on their luck, need money for something and end up paying 22+% interest.

Credit cards terms are clearly visible and not hidden.

Seek other lines of credit with a lower interest rate.

Credit cards are easy to use, so when people need money, credit cards are often the first things people turn to. The high interest rates and late fees are often an after thought.

Why am I explaining this to you? You should already know it.

Hey, I'm not the one having problems controlling my spending while having credit cards.

Why am I explaining to you the concept of personal responsibility? You should already know it. It is amazing how many of us have credit cards and pay no fees and no interest. If people are too lazy or ignorant to understand the terms of any financial instrument (be it a credit card or loan), then they deserve any negative consequences of their actions.

 

[Texashiker]

Why am I explaining to you the concept of personal responsibility? You should already know it.

Personal responsibility - that is why I do not have credit cards or checks.

It is amazing how many of us have credit cards and pay no fees and no interest.

Its amazing how many people in this thread do not pay late fees or interest - compared to the rest of the world. I would have to put the majority of the people posting in this thread are in the minority when it comes to credit card usage.

I know a lot of people that "claim" to pay off their monthly credit card debt, but they dont. Their level of debt is pretty clear when they go to a restaurant and do not have cash to pay a $20 - $30 bill, instead they pull out the plastic. Because their cash is tied up in the bank, the checking account, and paying on their cards.

People that can not get out from under the debt often claim that paying their bill on time helps their credit score. But more often, they can not get out from under the debt - they could not pay off the card if they wanted to.

 

[Alienwho]

I love these threads because all the anti-credit card morons come out in full force because they are either too irresponsible or have absolutely no idea how credit cards work. I'm sure this has already been covered in this thread, but here are the facts:

You are stupid if you DO NOT use a credit card. Why?
1) Rewards. I make over $350 every year by using my credit card. I also have never paid 1 penny in interest because I pay my bill in full every month whether it's $10 or $10,000. I succeed in this despite the fact that my credit card has 20% interest rate and $25,000 limit.
2) Credit Cards are much safer to use than Debit Cards. If somebody steals your credit card and racks up $5,000 of charges, you simply report the card stolen and are not responsible for any of the charges. Credit card companies are very good about this stuff and 99.99% of the time will side with their client (you) with no issues. If your debit card was stolen on the other hand, kiss that $5,000 goodbye forever. This probably isn't an issue for you because chances are if you haven't figured out number 1 yet you obviously don't have enough money in your checking out to get seriously burned.

 

[rcpratt]

I know a lot of people that "claim" to pay off their monthly credit card debt, but they dont. Their level of debt is pretty clear when they go to a restaurant and do not have cash to pay a $20 - $30 bill, instead they pull out the plastic. Because their cash is tied up in the bank, the checking account, and paying on their cards.

Dude, are you serious? I don't carry cash BECAUSE I choose to pay with credit everywhere.

 

[Texashiker]

You are stupid if you DO NOT use a credit card. Why?
1) Rewards. I make over $350 every year by using my credit card. I also have never paid 1 penny in interest because I pay my bill in full every month whether it's $10 or $10,000.

The problem lies when people use their cards to live above their means. With plastic as to use, people easily go into debt.

If you can pay off a $10,000 bill, then good for you - most of the people are not that lucky.

Dude, are you serious? I don't carry cash BECAUSE I choose to pay with credit everywhere.

If you want to live off of credit, then good for you.

I choose not to.

 

[rcpratt]

If you want to live off of credit, then good for you.

I choose not to.

Great, that wasn't the point. How does choosing to use a credit card "prove" that someone is in debt?

 

[PottedMeat]

I know a lot of people that "claim" to pay off their monthly credit card debt, but they dont. Their level of debt is pretty clear when they go to a restaurant and do not have cash to pay a $20 - $30 bill, instead they pull out the plastic. Because their cash is tied up in the bank, the checking account, and paying on their cards.

how is that indicative of debt? are you sure they're not using a card to get cash back, maybe they don't want to get charged $1.50 for using a random ATM for cash, maybe they don't want to go to an ATM?

 

[Blackjack200]

I've read most of this thread, but not all of it, so apologies if some of these things have been posted, I have not seen them posted or referenced.

Advantages to not using credit cards.

* 3%-5% transaction fee is not charged to the vendor. Strictly speaking, this doesn't impact you, but really it does. I usually get treated much better by small shopowners etc. when I use cash instead of a CC. I think if enough people started using cash, some shopowners might start giving a cash discount (which I believe all merchant agreements allow, someone can correct me if I'm wrong).

* Finances are simplified. If you want to pay off your credit card balance each month you need to keep track of its balance, as well as the balance of your outstanding checks and debit card transactions.

* Reduced exposure to fraud. No one can steal a CC# you don't have.

* You tend to spend less. It's easier on the psyche to spend using plastic than cash (this is conjecture, I don't know if it has actually been deomonstrated or not, but it seems that way to me)

All that said, the rewards for cards are compelling, I'm thinking about getting the Contintnal Chase card even though it has an annual fee because I figure I could get a free flight almost every year.

 

[bfdd]

I only have a debit card now. I hate using credit.

 

[Brainonska511]

* Reduced exposure to fraud. No one can steal a CC# you don't have.

This part doesn't matter though. You're protected by law if someone uses your credit card fraudulently.
----

The big part is personal responsibility. Some people clearly cannot handle that. I follow the philosophy of not spending money I don't have. If I want to buy something, I have to have the money in hand first. Then, I just choose to use my CC to pay for the item (and pay it in full at the end of the month). I saved a nice amount on textbooks last year because I was able to turn rewards points into B&N gift cards. I would have spent the same money last year if I was paying everything in cash, but I would not have gained anything. I would have had to spend more on books due to the lack of rewards.

 

[Alienwho]

The problem lies when people use their cards to live above their means. With plastic as to use, people easily go into debt.

Thanks for pointing out the obvious.

If you can pay off a $10,000 bill, then good for you - most of the people are not that lucky.

Uhm...then don't put that much on your credit card? Even if I had 1million dollars in credit I wouldn't use more than I wanted to pay off at the end of the month. Not a big deal.

If you want to live off of credit, then good for you.

I don't live off credit. I make money off of credit.

 

[Codewiz]

The problem lies when people use their cards to live above their means. With plastic as to use, people easily go into debt.

If you can pay off a $10,000 bill, then good for you - most of the people are not that lucky.




If you want to live off of credit, then good for you.

I choose not to.

What you are doing is like an alcoholic telling everyone to stop drinking because you can't handle your alcohol. Just because you have a problem doesn't mean everyone else does.

I hope you understand the reason you are getting the reaction.

You have pretty much stated you and your wife CANNOT be responsible. You are irresponsible people when it comes to money. You suck at managing your financies. Therefore the only way for you to function is to live by cash only.

That is fine. But you want to argue that if you use a credit card you will pay fees and you will pay interest. That is absolutely false and there are MANY MANY MANY MANY responsible people who do not.

Have I paid a CC late fee? Heck yeah when I was in college and IRRESPONSIBLE. The keyword is irresponsible. My current credit score is 780. I pay zero interest and zero fees. I use my cards RESPONSIBLY.

You can't do that and it is fine. But to demonize CC is just absurb. You should be looking in the mirror because that is where the problem exists.

 

[IndyColtsFan]

Personal responsibility - that is why I do not have credit cards or checks.

Good for you. I have credit cards and a checking account and have no debt and a super-high credit rating.

Its amazing how many people in this thread do not pay late fees or interest - compared to the rest of the world. I would have to put the majority of the people posting in this thread are in the minority when it comes to credit card usage.

I have no doubt that you're correct here. I know tons of people that have tens of thousands in credit card debt. When we got married, my wife had a small amount of credit card debt that we wiped out immediately and we agreed that there would be no more of that.

I know a lot of people that "claim" to pay off their monthly credit card debt, but they dont. Their level of debt is pretty clear when they go to a restaurant and do not have cash to pay a $20 - $30 bill, instead they pull out the plastic. Because their cash is tied up in the bank, the checking account, and paying on their cards.

Errr, now you're making silly generalizations. I have no debt (outside of a mortgage) and NEVER pay in cash at a restaurant. As a matter-of-fact, I rarely have more than $10 or $20 in cash on me. Why would I? I use my debit card as a VISA card and money comes right out of my account. More importantly, I also get reward points when I use it. As far as account balance is concerned, I always know about how much is in the account and am never at risk of overdrafting.

People that can not get out from under the debt often claim that paying their bill on time helps their credit score. But more often, they can not get out from under the debt - they could not pay off the card if they wanted to.

Credit score is based on a number of factors. Paying the bill on time is just one component. Having huge amounts of debt on a revolving account is a negative too. The credit bureaus use a ratio (forgive me, I forget the exact ratio they use) to determine your debt load on revolving accounts and that factors into your credit score as well.

 

[Texashiker]

I've read most of this thread,,,,,,,,,,,,,,,,,

All that said, the rewards for cards are compelling, I'm thinking about getting the Contintnal Chase card even though it has an annual fee because I figure I could get a free flight almost every year.

If the mouse can get the cheese out of the trap, it will have a nice reward also.

Credit cards are not designed for you to get the cheese. All they want to do is smash your little head and drain the life out of you.

The few people that do manage to get the cheese, they stand up and brag about how great the trap is, and how easy it is to get the cheese. Then the unsuspecting mouse comes along, hears about how easy the cheese is to get, tries, and gets his head smashed.

And that is how credit cards work.

If you can play the trap game and win, more power to you.

But more then likely, the majority of the people that try to get the cheese will fail.

 

[ponyo]

If you want to live off of credit, then good for you.

I choose not to.

OP, there's a difference between Dave Ramsey who can get all the credit cards he wants but choose not to and someone who can't get decent credit card and have to live with cash system.

It sounds like your credit is jacked and you have no choice but to pay everything with cash. If that helps you stay out of trouble, than that's a good benefit.

 

[Svnla]

The problem lies when people use their cards to live above their means. With plastic as to use, people easily go into debt.

If you can pay off a $10,000 bill, then good for you - most of the people are not that lucky.

If you want to live off of credit, then good for you.

I choose not to.

See my previous post with the simple rule = pay off the darn CC balance before the due date => no debt, no fee, no cost, nothing and don't buy things you don't need/can't afford.

CC is a great tool IF you learn how to use it properly. Just like a sharp knife, use it properly will help you a lot but don't use it correctly would hurt you a bunch.

Live off of credit? No, use credit to maximize it for your benefits is more like it.

Let do this again. Let say you and I are making the same amount of money per year, 100K and we are spending about 10K per month for our home and business expenses.

You = pay everything with cash/debit/money order. At the end of the month, you gain nothing. Nothing is wrong with that if you chose to do that IMO but you could do better, much better (see below).

Me = pay everything with my SIGNATURE REWARD CC with 2% cash back and pay off everything before the due date. A week after my payment, I get $200 cold hard cash back ( a few thousands bucks a year) on top of ALL the extra benefits of a high end reward CC such as these = http://usa.visa.com/personal/visa-signature/benefits/index.jsp PLUS high FICO score (great for mortgage/car loans/etc.)

Now you tell me, if a person is using CC the right way, how is it NOT better than paying with cash?

 

[Gigantopithecus]

If you can pay off a $10,000 bill, then good for you - most of the people are not that lucky.

It's this precise mentality that disgusts me. It's not that I busted my ass working and staying in school for more than a decade after high school that I can pay a $10,000 credit card bill, it's because of luck. OP, I was civil in my first post in your thread, but I'm sorry, you should be happy that you figured out how to live within your means, and if you can't understand how other people are able to use credit to their advantage, then you're either willfully ignorant or a fucking idiot.

 

[IndyColtsFan]

I don't live off credit. I make money off of credit.

This. I make hundreds in rewards every year between my reward credit cards and reward debit cards.

 

[alkemyst]

WTF are you talking about? We are like the least affected state in the U.S. when it comes to the economy.

You may want to look into the history of equity lines in your state and even the control over them now.

 

[Capt Caveman]

This guy is either dumb as a rock or just trolling. He's repeating the same arguments and not actually reading what anyone is saying. I give up.

Read his other posts in other threads. He's a troll.

 

[OILFIELDTRASH]

OP with fingers in ears "I can't hear a word y'all are saying!"
"Credit card companies made me spend $30,000 cash I didn't have. I was just a mouse looking for a little cheese."