Using credit cards for monthly expenses?

[amastewa93]

Last Friday I woke up to discover someone had hacked my bank account (retrieved a debit card number from a recurring payment, I'm assuming or at the gas pump). They stole around $2,000.

I'm confident I'll get my money back - no worries there. It has been more of a stressful/frustrating/inconvenient situation than anything.

Upon discussing this with a few of our friends, many of them say they simply pay off their credit card in full every month and use it for their expenses to avoid things like this. Their reasoning is the credit card company will give you your money back immediately, whereas the bank must do an investigation, which can take up to 90 days.

What are your thoughts on this? Smart move? Dumb?

*Also we don't store our card numbers or passwords on browsers and change all passwords and pins quarterly - there was nothing more (that I know of) we could have done to avoid this happening, unfortunately.*

[corn18]

I think it's a smart move. We pay everything possible with a credit card. We use the Fidelity 2% cash back on everything card. It is a nice kicker every month. The Citi double cash back card is good, too. We don't use debit cards for anything.

[scfr]

Smart move, as long as you have a system in place to ensure you don't spend more using a credit card than you would have with the debit card, and as long as you always pay the balance in full at the end of the month. If you have a budget and you continue to stay within your budget, you'll be fine. If you record each CC purchase as if the money had already come out of your bank account (even though it hasn't) you'll be fine.

We have a "no debit card" policy in our household and it's for exactly the circumstance you are describing (hacking potential). We have a couple different credit cards that we use at different places for the rewards. The Citi Double Cash Back is one and it's a good general purpose card.

On the other hand, using credit cards can be risky for some people because they have a history of racking up CC debt. My sister is one of those people. She knows that she can't be trusted to use a credit card prudently, so she just refuses to have one. For her, a "no credit card" policy is what works best. For her, switching to using a credit card for all of her expenses would be a "dumb" move.

[bjl584]

Good strategy to get the reward points.

Just be mindful of your spending so you don't go over budget

[disneysteve]

I will never understand the broad appeal of debit cards. Credit cards do all of the same things but with far greater consumer protection.

We have never used a debit card. We do use credit cards for virtually all of our spending including many regular bills - cell phone, cable, internet, alarm, Netflix, medical bills, and much more.

If an unauthorized charge appears on your debit card, you are out that money immediately until the bank does their investigation and eventually returns it to you. If an unauthorized charge appears on your credit card, you are out nothing.

[cypher1]

Last Friday I woke up to discover someone had hacked my bank account (retrieved a debit card number from a recurring payment, I'm assuming or at the gas pump). They stole around $2,000.

I'm confident I'll get my money back - no worries there. It has been more of a stressful/frustrating/inconvenient situation than anything.

Upon discussing this with a few of our friends, many of them say they simply pay off their credit card in full every month and use it for their expenses to avoid things like this. Their reasoning is the credit card company will give you your money back immediately, whereas the bank must do an investigation, which can take up to 90 days.

What are your thoughts on this? Smart move? Dumb?

*Also we don't store our card numbers or passwords on browsers and change all passwords and pins quarterly - there was nothing more (that I know of) we could have done to avoid this happening, unfortunately.*

Smart move, no matter how you argue it. I use credit card for everything. Heck, I don't care if my CC account gets hacked as long as they don't get my SSN (both have happened yrs ago, but traced to paper trail, not digital). They don't get your money, just "credit." For your exact experience of a checking/saving account affected, the hassle isn't worth the risk. Yes, you'll get your cash back, eventually.

Credit card companies want consumers to know they're protected, and feel confident in their service. If we didn't, they'd suffer and lose our business. Heck, I'm pretty sure they realized this even before e-commerce became standard. So if someone stole my wallet, I would not worry about my cards being used. The debit card is locked down to only use for ATM, so checking is protected. They can use the CCs,but I'll have them flagged immediately.

[Drake3287]

Yes, absolutely use a credit card for both protection and more importantly, rewards. Cash rewards for myself. I charge EVERYTHING you can think of and simply pay it off in full each month. Doing this I easily get $2,000. to $2,500. back in cash each year. Yes, free money.

You simply just need to discipline yourself in paying it in full each month. I haven't paid a cent in finance charges in years. The one negative thing with using a credit card for all your purchases is the increased risk of having your credit card number compromised which in turn forces you to get a new card and account number. Happen's to me once a year or so. At least with a credit card you're fully protected.

[cypher1]

You simply just need to discipline yourself in paying it in full each month.

Agreed. I understand not everyone has the discipline to look at it this way, but to use a CC like a debit card for balancing what you can or cannot afford that month based on your monthly net income. Tracking the CC like a regular checking account. If you believe you go over on a checking account for a purchase, you wouldn't buy, to prevent an overdraft. Same rules or mentality to apply with credit and revolving balance.

[kork13]

I do the same as many others here -- almost all of our spending & recurring bills go on to one of a few different rewards credit cards, and have all of those credit cards are set up for automatic payment every month. However, I monitor those accounts fairly regularly, checking in on them every couple weeks to ensure nothing unexpected shows up. I pretty much only use my debit card for the random ATM withdrawal, or the random places that don't accept credit cards (Winco, for example, here in the western US).

[LivingAlmostLarge]

Debit card for traveling when i need cash. My mom even has turned over on charging everything. She has two credit cards. One regular usage and hawaiian airlines branded. Other for online orders. She is worried it'll get stolen.

[Fishindude77]

We don't even have debit cards.
Use a credit card which we pay off each month, plus get 2% cash back on, and / or pay cash for most routine purchases.

[amastewa93]

Thanks for the feedback everyone. After we paid ours off, we tried to avoid them altogether but I think we will be switching to doing most of our business on a CC.

[kork13]

Thanks for the feedback everyone. After we paid ours off, we tried to avoid them altogether but I think we will be switching to doing most of our business on a CC.

As long as you're mindful about how you're using it, and ensuring that you pay it off every month to never carry over a balance, you should be fine. You might just want to reconsider if you find that you're slipping back into credit card debt.

[rennigade]

What else would you use to pay for monthly expenses? Writing checks is a waste of resources, and costs you money to mail a check.

[~bs]

its ok if you can handle your expenses. if not, use your debit card and sign up for text alerts. any transactions go through, you get texted immediately. Report as soon as a fraud charge goes through and the bank should be able to reverse.