Comments on: Pros and Cons of Credit Cards http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/ Tips for living frugal while still having a life Sun, 14 Mar 2010 17:28:27 -0500 http://wordpress.org/?v=2.8.5 hourly 1 By: Credit Card Issuer Closed My Account | Frugal Dad http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/comment-page-1/#comment-15751 Credit Card Issuer Closed My Account | Frugal Dad Tue, 13 Jan 2009 11:01:17 +0000 http://frugaldad.com/?p=846#comment-15751 [...] on your score are determined by a couple different criteria, so it is important to weigh the pros and cons before closing credit card accounts yourself. If your bank closes them, particularly for reasons [...] [...] on your score are determined by a couple different criteria, so it is important to weigh the pros and cons before closing credit card accounts yourself. If your bank closes them, particularly for reasons [...]

]]> By: Credit Karma Weekly Roundup - Let it Snow! http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/comment-page-1/#comment-13689 Credit Karma Weekly Roundup - Let it Snow! Sun, 14 Dec 2008 11:03:48 +0000 http://frugaldad.com/?p=846#comment-13689 [...] Frugal Dad on The Pros and Cons of Credit Cards. [...] [...] Frugal Dad on The Pros and Cons of Credit Cards. [...]

]]> By: Squeaky http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/comment-page-1/#comment-13507 Squeaky Thu, 11 Dec 2008 19:52:12 +0000 http://frugaldad.com/?p=846#comment-13507 @Rob: That's actually good news; I was starting to almost feel guilty there for a second. Thanks for helping me continue to rationalize my behavior. :-) The fee credit card companies charge merchants is just a couple percentage points, is it not? I'm not sure that it would cover the price of a plane ticket, the stamps and paper, and the employees and infrastructure to do things like processing payments. I wonder how much of their money they really make from finance charges, and whether they "need" to raise rates so high to stay in business. @Rob:

That’s actually good news; I was starting to almost feel guilty there for a second. Thanks for helping me continue to rationalize my behavior. :-)

The fee credit card companies charge merchants is just a couple percentage points, is it not? I’m not sure that it would cover the price of a plane ticket, the stamps and paper, and the employees and infrastructure to do things like processing payments. I wonder how much of their money they really make from finance charges, and whether they “need” to raise rates so high to stay in business.

]]> By: Ilah http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/comment-page-1/#comment-13483 Ilah Thu, 11 Dec 2008 14:12:20 +0000 http://frugaldad.com/?p=846#comment-13483 My sister charges everything and has gone to Europe with her mile credits 4 or 5 times at least. I tried it for about two months, in some ways it was handy as I only wrote one check to cover all my expenses---but it was a whopper! I just couldn't handle writing a check for a couple thousand dollars every month. Granted, I spent that much in multiple little checks, but the little checks were just easier for me to do. My husband and I got into credit card debt in the past and it took a long time to pay off and get ourselves back in the game. I guesss that's why I just get anxious seeing a high credit card balance even though I paid it in full every month, I just became anxious that one month I wouldn't have the money and the whole thing would snowball again. My sister charges everything and has gone to Europe with her mile credits 4 or 5 times at least. I tried it for about two months, in some ways it was handy as I only wrote one check to cover all my expenses—but it was a whopper! I just couldn’t handle writing a check for a couple thousand dollars every month. Granted, I spent that much in multiple little checks, but the little checks were just easier for me to do. My husband and I got into credit card debt in the past and it took a long time to pay off and get ourselves back in the game. I guesss that’s why I just get anxious seeing a high credit card balance even though I paid it in full every month, I just became anxious that one month I wouldn’t have the money and the whole thing would snowball again.

]]> By: Mike http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/comment-page-1/#comment-13482 Mike Thu, 11 Dec 2008 13:52:44 +0000 http://frugaldad.com/?p=846#comment-13482 I have earned about $400 this year on cash back incentives with a Speedway Mastercard, and have another $100 I can turn in now! I have 3 cards to do this: Speedy Rewards Card, Chase Speedway Mastercard, and AAA 4% discount Speedway Gift Card. I receive 4% back on my gift card when I put money on it. IE, I tell them I want to put a $100 on it, it only cost me $96. But the card has $100 on it. I use my Speedway Mastercard and earn points thru them, 4000. You always use your Speedy Rewards Card anytime you make a purchase, and when you put $100 on a gift card, they give you 2000 points. Plus, I use my Mastercard in town for all of my purchases (MUST pay off each month or your not doing any good) and they give me 10 points for every dollar. It only takes 66,000 points to get back $100. Usually hit that about every other month. Here's the kicker...I print out my $100 cash back ticket...put it on my 4% gift card and yep, you guessed it, they put $100 on my gift card and give me back $4. So actually, I get $104 each time I reach 66,000 points! I have earned about $400 this year on cash back incentives with a Speedway Mastercard, and have another $100 I can turn in now!
I have 3 cards to do this: Speedy Rewards Card, Chase Speedway Mastercard, and AAA 4% discount Speedway Gift Card.
I receive 4% back on my gift card when I put money on it. IE, I tell them I want to put a $100 on it, it only cost me $96. But the card has $100 on it. I use my Speedway Mastercard and earn points thru them, 4000. You always use your Speedy Rewards Card anytime you make a purchase, and when you put $100 on a gift card, they give you 2000 points. Plus, I use my Mastercard in town for all of my purchases (MUST pay off each month or your not doing any good) and they give me 10 points for every dollar.
It only takes 66,000 points to get back $100. Usually hit that about every other month. Here’s the kicker…I print out my $100 cash back ticket…put it on my 4% gift card and yep, you guessed it, they put $100 on my gift card and give me back $4. So actually, I get $104 each time I reach 66,000 points!

]]> By: The Penny Pincher http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/comment-page-1/#comment-13466 The Penny Pincher Thu, 11 Dec 2008 01:28:26 +0000 http://frugaldad.com/?p=846#comment-13466 The "there is no emotional separation from money" is crucial. Study after study has shown that people spend more when shopping with a credit card than they would if shopping with cash. Quite often people will spend 30% or more if using a credit card than someone who is not using a credit card. A credit card, without proper discipline and most people don't have the necessary fiscal fortitude, also encourages impulse buying and discourages shopping around for a better deal. As for rewards, I don't worry about those too much. I buy my gas at my grocery store and they give me back a coupons to use in the grocery store when shopping for food (when I fill up, I usually get two dollars or more back). It is enough to make it worthwhile. The “there is no emotional separation from money” is crucial. Study after study has shown that people spend more when shopping with a credit card than they would if shopping with cash. Quite often people will spend 30% or more if using a credit card than someone who is not using a credit card. A credit card, without proper discipline and most people don’t have the necessary fiscal fortitude, also encourages impulse buying and discourages shopping around for a better deal.

As for rewards, I don’t worry about those too much. I buy my gas at my grocery store and they give me back a coupons to use in the grocery store when shopping for food (when I fill up, I usually get two dollars or more back). It is enough to make it worthwhile.

]]> By: Shannon http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/comment-page-1/#comment-13459 Shannon Wed, 10 Dec 2008 22:24:01 +0000 http://frugaldad.com/?p=846#comment-13459 The fees are usually a percentage of the purchase price also so the more you spend the more they get. They probably love you. The fees are usually a percentage of the purchase price also so the more you spend the more they get. They probably love you.

]]> By: Rob http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/comment-page-1/#comment-13456 Rob Wed, 10 Dec 2008 21:17:45 +0000 http://frugaldad.com/?p=846#comment-13456 @squeaky:Actually the credit card company makes money every time you use your card. The store must pay visa, mastercard, etc. merchant fees for every credit card transaction. So while you might not be paying any interest, the credit card is very very happy that you continue to use them... @squeaky:Actually the credit card company makes money every time you use your card. The store must pay visa, mastercard, etc. merchant fees for every credit card transaction. So while you might not be paying any interest, the credit card is very very happy that you continue to use them…

]]> By: Cool Blogs « The Penny Pincher’s Weblog http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/comment-page-1/#comment-13449 Cool Blogs « The Penny Pincher’s Weblog Wed, 10 Dec 2008 20:19:36 +0000 http://frugaldad.com/?p=846#comment-13449 [...] Another good blog is Frugal Dad. Today’s post of interest: “The Pros and Cons of Credit Cards.” [...] [...] Another good blog is Frugal Dad. Today’s post of interest: “The Pros and Cons of Credit Cards.” [...]

]]> By: Craig http://frugaldad.com/2008/12/10/the-pros-and-cons-of-credit-cards/comment-page-1/#comment-13445 Craig Wed, 10 Dec 2008 20:05:28 +0000 http://frugaldad.com/?p=846#comment-13445 Credit card use and fees should be introduced into schools and colleges before any kid ever really gets a hand on credit cards. I was lucky to have my parents teach me more about them before I was on my own. Most people aren't like that. They need to be educated on how to properly use them and potential damages of over using. Credit card use and fees should be introduced into schools and colleges before any kid ever really gets a hand on credit cards. I was lucky to have my parents teach me more about them before I was on my own. Most people aren’t like that. They need to be educated on how to properly use them and potential damages of over using.

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