Help me understand the use of credit cards today

[Conan The Librarian]

I made a post on the "bank of america" thread about how I was alarmed that my old credit card account was sold to bank of america, and that I need to find a replacement. Some very helpful people made suggestions for a replacement, and I was surprised to see a Cabelas Visa card seems to make a lot of sense.

One other thing that has surprised me is that the use of credit cards has changed to include incentives and other options that make them interesting for daily use. Up to now, I only used my one card for travel and mail order related expenses.

Fewer places in my area take checks, so I'm being pressured out of the check writing era.

Can you tell me how to make best use of a credit card in modern times? I simply have not paid much attention to it.

I still want to keep using it in such a manner that I will pay it all off every month, and very seldom run a balance that extends beyond the month when I did the purchase.

[Brett]

My suggestion is to keep doing what you've been doing, I.e.; use them sparingly and pay them off at the when the bills come in.

 All the incentives are designed to entice you into digging yourself into a hole that they hope you can't get out of so that they can collect high interest charges from you from now till dooms day.

[dukkillr]

My suggestion is to keep doing what you've been doing, I.e.; use them sparingly and pay them off at the when the bills come in.

 All the incentives are designed to entice you into digging yourself into a hole that they hope you can't get out of so that they can collect high interest charges from you from now till dooms day.

No question, if you have even a 1% chance of not being able to pay it off, DON'T use them.  Credit cards are good tools only if you have the money and the financial discipline to use them correctly.  They are not a good source for a short term loan.  Treat them like a check, in that you only spend money you know you have, and you'll be better off.  Checks don't pay you back.
 
There is some value in having a credit history also.  When I went to buy my first house I had never had a credit card, nor ever bought anything by loan or on payments.  They looked at me like I was an alien because they could not run my credit record.

[mcwoodduck]

All Visa cards are owned by B of A
Master Card is a Chase product
And discover is a sears product.
No matter who's name is on the card.
The name on the card gives that orginazation a percentage of the Visa Vig they charge the retailer as well as a portion of the interest carried.
All Visa cards start wiht a 4
All Mater cards start with a 5
American Express start with a 3
Discovery start with a 6
and Dinners Doubles started with a 1 and a 2 I froget what one was personal and what was company.

[PowPow]

If you have the discipline to pay it off month to month, look for one with no monthly fee, regardless of the interest rate.

Some cards offer incentives regardless of whethere you pay them off monthly or not; Our Discover card provides coupons for Lands End and other retailers based on a percentage of annual use. The cost comes out of the fee they charge the retailers.

For a few years now, we have been paying for gas and groceries on Discover to increase the annual billing, paying off monthly and paying no interest. We use the coupons to buy clothes and other things. I wish Discover offered Midsouth Shooters Supply coupons.

[kennyd]

Visa/Master Card actually are the owners and rulers of the whole world.  Be ware of some that now charge interest from day of purchase, and those that have a poison pill if a payment is "lost".  Join a credit union for the somewhat better service if you can and get their card.


Wife and I have one card for emergencies; which are things like major car problems, dentist, and perhaps eyeglasses.  With our health problems, work injury 2 years ago, and some odd things we could not fund we are carrying a balance.  The card never was for things like Disney, but once upon a time it bought (with wife's full consent) a Ruger #1 (only rifle I will ever need!!!)  Nothing said about want.


If you ever fly, rent, or anything a card of some sort is almost mandatory.  Debit cards work somewhat the same for some of this.  (See my first sentence)

[DDZ]

I use a Master card for everything I buy. Then pay the total amount each month. I get 3% on every dollar spent towards Subaru parts and service, or towards a car.

[hillbill]

why do you even need a credit card? just get a fruad protected debit card. you can use them for anything a credit card is used for.ive had one for years and have never had anyone say they wont take them yet.seems so simple.

[Bugflipper]

I had the Cabelas visa for 12 years. 2 years ago things started going bad with the billing system. There were 2 billing centers one was in Lincoln, NE, I don't know where the new one is. I always paid the bill off each month. They kept on charging me a $30 late fee and stacking interest on an unpaid bill. Eventually I found out that the new billing center was charging me because the one I was supposed to pay to was not processing the checks in a timely manner. They were postmarked a week or two before the due date. I fought with them several times to remove the charges and they always did. But it just became a pain in the butt. They would call a week or two after the due date every month dunning me for the money. Both billing centers would blame the other and each month was going to be the last time it was going to happen. I finally just canceled the card.


I went through USAA for the visa I have now. They had the lowest interest rate at the time. Cabelas would only take a check or a router number off of a check. USAA will do those as well as an atm or transfer from a bank account. You can pay online, over the phone, with paypal or on a mobile phone on the internet. Text for balance and so on. I just set it up to pay off the balance each month from my checking account automatically. But you could set up to pay minimum to not get a late fee if you were short. Or log on monthly to the website and pay how much you want.


For a credit card I would look for the lowest fixed rate. Not one that has a gimmick of a low rate for 6 months then a very high rate after that. I think the cabelas one was 15.3-18.3% for items not purchased at cabelas if not paid off and 9.99% for cabelas purchases. USAA is 6.9%.

[Conan The Librarian]

Thanks for the info! I think I'll just keep doing what I'm doing. I don't like getting a bill at the end of the month, and a couple of hundred bucks a year is no incentive for me to tamper with my financial discipline and accounting practices.
 
I didn't know there were fraud protected debit cards. I guess my question would be, why use a fraud protected debit card when a credit card is guaranteed widely usable for travel, and has well established consumer protection laws behind it, and probably has no additional fee associated with it? I'm not saying it's a bad idea. I am saying I just don't understand the benefits.

[williamlayton]

I don't like cash--well, I don't like carrying around a lot of money. If I have $19/15 in cash on me that is a lot.
I use a credit card for almost all purchases and pay off the balance at the end of the month---same as cash but without going to the bank every day or two to get money.
Just my way.
Blessings