Credit Card "Deadbeats" Beware

[swanson719]

Play with snakes, you're going to get bitten. Credit cards are snakes. A good EF and cash in hand does just as much good, and is better advice for the vast majority of people. Very few use credit cards responsibly.

[parafly]

Play with snakes, you're going to get bitten. Credit cards are snakes. A good EF and cash in hand does just as much good, and is better advice for the vast majority of people. Very few use credit cards responsibly.

Not true. One third of credit card users pay their monthly bill in full, and the vast majority make their payments on time.

I've been "playing with snakes" for 10 years and didn't get bit once. Instead, I built up my credit score to above 800 and cashed in several gifts through rewards programs.

[watsoninc]

I agree with swanson719. I just don't mess with them hardly at all (2-3 times per year max and on very large purchases). I use it only because the cash back generated from these purchases makes it worth it. I pay the card off within 2-3 days. However, any credit card wanting to charge me for this convenience is gone because I simply don't need it.

I am definitely a true dead beat because their only profit off of me is processing fees, but only 30% of credit card users are true dead beats. I think most dead beats, like me, would be indignant if we started having to pay interest or annual fees.

One more thing, I primarily use my check card as a credit card, and according to Visa/Mastercard website, I am afforded the exact same legal protection as anyone using their credit cards. Thus, it is my understanding that it is no safer to use a credit card over a debt card.

[swanson719]

I'm with Dave Ramsey on this one. Who needs a credit score if you pay with cash? Who needs credit period if you pay with cash? Even if 1/3 pay in full each month and most make payments on time, the benefit to society of credit cards is negative as a whole IMO because of the damage it does to the highly impoverished. The people who get them and use them as a sense of hope, trying to get ahead and then cant, and then cant make the payments. You and others might be responsible with them, but you don't have a true NEED for credit outside of maybe a mortgage. People who NEED credit the most of all suffer from the practices that have got us here. How often do we have someone post a budget with thousands in CC debt? It was a burden to their family, not a help. That's why I'm against credit cards.

[parafly]

You don't have a true NEED for credit outside of maybe a mortgage. People who NEED credit the most of all suffer from the practices that have got us here. How often do we have someone post a budget with thousands in CC debt? It was a burden to their family, not a help. That's why I'm against credit cards.

There are many reasons why you need credit...mortgage, small business loan, etc.

I don't blame the credit cards, I blame the people who don't know how to use them responsibly. Let me give you an analogy. In the case of a morbidly obese person, who is to blame, the person or a fork? Going by your logic, you would be against forks.

[boosami]

One more thing, I primarily use my check card as a credit card, and according to Visa/Mastercard website, I am afforded the exact same legal protection as anyone using their credit cards.

Check your facts... There is no federal law that protects debit cards from fraudulent activity (though at least one state--MA--has state law mandating it). For everyone else, it is up to the bank to create its own policies, and it's strictly voluntary. Contrast that to credit cards, which have strict federal laws regarding liability with fraud.

Aside from the legal aspect, fraud on your debit card could drain your checking account of money, which could result in bounced checks, fees, frozen accounts, and other major problems. If you suspect fraud on your credit card, you have 60 days to clear it up before you might have to use real money to pay it and otherwise your legally liable for no more than $50.

There is a federal law regarding consumer liability with ATM cards, but depending on your bank they may not apply it to debit cards. And either way, the law protecting credit card is better.

I) $50 IF YOU NOTIFY THE BANK WITHIN 2 DAYS OF FINDING OUT YOUR CARD IS LOST OR STOLEN;

II) UP TO $500 IF YOU NOTIFY YOUR BANK AFTER 2 DAYS OF LEARNING OF THE LOSS OR THEFT;

III) POTENTIALLY, UNLIMITED LIABILITY FOR ALL UNAUTHORIZED TRANSACTIONS THAT OCCUR AFTER 60 DAYS FROM WHEN YOU RECEIVE YOUR STATEMENT CONTAINING THE UNAUTHORIZED TRANSACTIONS IF YOU FAIL TO NOTIFY YOUR BANK WITHIN 60 DAYS OF RECEIVING YOUR BANK STATEMENT.

[wincrasher]

Credit cards are wonderful things. They make transactions go smoothly protecting you and the merchant.

People who say they will never use credit basically are saying that they can't trust themselves or can't manage their affairs.

Why can't you pay the credit card bill when it comes in? You pay your electric bill don't you? You pay the newspaper boy don't you? What's the difference?

[disneysteve]

Credit cards are wonderful things. They make transactions go smoothly protecting you and the merchant.

People who say they will never use credit basically are saying that they can't trust themselves or can't manage their affairs.

Why can't you pay the credit card bill when it comes in? You pay your electric bill don't you? You pay the newspaper boy don't you? What's the difference?

I'm with you, but to be fair, the 4 credit cards that we use regularly have a combined credit limit of $86,500. If either of us had a spending problem, it would be very easy to get in deep trouble. The newspaper delivery is a fixed cost, the same price every month. The electric bill varies but only in a pretty predictable range, higher in August, lower in January. I know I can't suddenly have a $5,000 bill one month, while that is certainly possible on my credit cards.

I'm not trying to defend those who abuse their CCs. I just don't think the analogy is accurate.

[Seeker]

There is a federal law regarding consumer liability with ATM cards, but depending on your bank they may not apply it to debit cards. And either way, the law protecting credit card is better.

Boosami, aren't ATM cards and debit cards essentially the same thing? Are there any banks still issuing pure ATM cards anymore?

[disneysteve]

Boosami, aren't ATM cards and debit cards essentially the same thing? Are there any banks still issuing pure ATM cards anymore?

I believe you can request an ATM-only card even though it is the debit cards that are standard issue.

[Inkstain82]

I believe you can request an ATM-only card even though it is the debit cards that are standard issue.

If you have a savings account only, you will have just an ATM card.

[Inkstain82]

Credit cards are wonderful things. They make transactions go smoothly protecting you and the merchant.

People who say they will never use credit basically are saying that they can't trust themselves or can't manage their affairs.

Why can't you pay the credit card bill when it comes in? You pay your electric bill don't you? You pay the newspaper boy don't you? What's the difference?

Actually, I once got myself in such deep trouble that I didn't pay the electric bill for quite a while.

The newspapers I got for free, because I worked for them, at least.

[boosami]

Boosami, aren't ATM cards and debit cards essentially the same thing? Are there any banks still issuing pure ATM cards anymore?

Nope, not even close to the same thing. Debit cards are co-branded with Visa or MasterCard or whatever, while ATM card have a different account number that does not conform to the credit card naming standards. You can't use it with most merchants because it's a different type of system. Your bank has two systems, one that handles ATM transactions and one that handles credit card transaction. A debit card works over the credit card system, even though it's not technically "credit."

However, banks do still issue them (if you ask, most automatically assume you want a debit card). You also might get them for savings accounts where there is no debit card option.

ATM cards require you to enter the PIN number for all transactions. Debit cards can be run with the PIN or as a transaction where you sign. That's why you can use your debit card for online transactions where you aren't asked for a PIN. Next time you use your debit card, ask the retailer to run it as credit and you'll see what I mean.

[Gjowers]

I too am a deadbeat. If it ever costs me money to have a credit card I will get rid of them. I only have two and rarely use them.

I am all for reforms to this industry. I think much of our economic trouble today is related to far too easy access to credit, and much of the previous boom was an illusion created by consumer spending that relied on credit. It was unsustainable and we are now dealing with the inevitable result. I hope this legislation can do something to prevent a recurrence.

[Joan.of.the.Arch]

I might keep a CC even if I had to pay an annual fee, yet I would not use it much. I use them heavily now in order to get the rewards. Before the rewards cards I barely used a credit card. I'd return to that. I'd still want one to facilitate the occasional car rental, and to have for emergencies where I had had to pick up and go, such as if there were a family emergency and I had to get a flight.

I'm not real keen on debit cards either, and would probably use much, much more cash if CC rewards go away.