On the subject of credit cards, how many of you use it for everything...

[StacyWithFourRugrats]

but pay it off every month? We have 2 credit cards, only one of which we use (the other is only for emergencies but we have never used it). Our main credit cards gives us 2% back directly into our eldest's 529(k). Because of this, we use our credit card for everything. We rarely carry much cash. However, we pay it off EVERY month.

 

I would love to stop using my credit card. But I keep seeing that 2% going into my ds's 529(k). For us, that is about $50 a month of free money. However, I do know that if we didn't use our credit card as much, we would probably spend less. But I keep seeing that 2%. Plus, a credit card makes you about a month behind in bills. So you would generally need about a month's extra money to get off the credit card. Our tax return could easily help us do that.

 

So how many of ya'll are like us and use the credit card for all purchases and pay it off every month? Do you do this because of the credit card perks or just because it is easier to use a credit card than carry around cash?

[Lorna in the boonies]

I do it, and for both reasons. It puts money into a reward system and it's easier than carrying cash/checks everywhere I go.

 

I've sat through Financial Peace University and love Dave Ramsey's advice about everything -- but haven't been able to wean myself off the credit cards. I do pay it off every month and have never paid any interest.

[Mom2GirlsTX]

balances on our credit cards. I think that is neat that you have a card that gives perks towards your 529K. I thought it would be a good idea to do that but I always forget to do it. I use my debit card for everything and watch what I spend through my online banking, and for us personally, since I switched to using my debit card only we have spent alot less than when I was using my credit card and paying off balance each month. It must be a "mental" thing for me, but just taking directly out of my checking I do indeed spend less...thus I'm not using my credit card.

[Daisy]

I only use the cc for curriculum and only order over the phone now (uugh, after having our cc# stolen three different times over the internet). If and when I use the cc, we pay it off within the month. We actually pay CASH (you know, that green stuff.) for everything.

[KS_]

We pay for a lot of things with our credit cards (and pay them off every month), but I don't pay for groceries and stuff with them because I had a hard time keeping track of what we were spending that way. I'd end up spending more on that stuff than what I had budgeted for the month, so I use the credit card for fixed bills and things like that.

[WTMindy]

because of the cash rewards that we get. But, we pay it off every month. I don't think it makes me buy more than I normally would because I just think of it as cash.

[lynn]

We have one we use for everything. We are faithful at labeling every expense on line to moniter our budget. Plus we get rewards which we usually take the cash. It get's paid in full every month.

[Tammy]

and I agree with another poster....I ger REWARDS, LOL. I pay all of mine off each month though....never have paid any interest...so they aren't making money on me.

 

I was making so much on one credit card....they stopped the 'rewards' LOLOL!

 

Tammy

[Susie in SWVA]

We use ours for EVERYTHING and pay it off every two weeks. We get $25 reward coupons back for using it and have entirely paid for Christmas for several years with them.

Susie in SWVA

[Sharon in SC]

We pay everything we can with our credit card for two reasons: 1) the perks (frequent flyer miles for us - we've flown to Vegas, Arizona, and sent my dad on trips as thank you for his help with our renovations all at no $$ out of our pocket for airfare); 2) it leaves the $ in our interest bearing checking account longer which, while it's not alot of $, it is some $, kwim?

 

We do pay it off at the end of every month thus paying no interest. I track all of our expenses through Quicken so know exactly what's going for groceries, gas, etc, etc. Would I spend less if I didn't do this? Can't say for sure, obviously, but I don't think so. (At least not enough difference to warrant doing anything differently). I view it the same way I would a debit card - once the transaction is complete, that is $ spent out of our pocket.

 

FWIW,

sharon

[debbiec]

We do the exact same thing for rewards and convenience, though a few times a small balance has sneeked up on us.

[Ellie]

no writing checks, no carrying cash, just the plastic.

 

I think my card might have some perks, but I forget what they are, lol.

[Chloe]

We have two major ones and earn air-miles on one and cash back on the other. Dh has made an awesome spreadsheet program and we track where all our money goes. Using the ccs makes it easier.

[KristineIN]

We do what everyone else says, we mainly use it for gas and several bills that automatically get charged on it. I usually pay groceries on the debit card. We pay it off every month. Our limit is pretty low (about $2500.00 if you consider that low, but it's our emergency card too and that's the only credit card we have.) It is a card with higher interest, and we have kept that one on purpose to keep us from carrying a balance. If for some reason, I do have an emergency, I'll call Discover and they have lowered my interest before.

 

Kristine

[JFSinIL]

getting $25 certificates from Amazon is more than we'd make in interest keeping the $ in a checking account and writing checks off it ...plus I save my checks for the few bills I can't e-pay. I figure Amazon gives me at least $300 in free books/dvds etc yearly.

 

The trick is to pick ONE card with a reward you want and use it, paying in full each month.

[Colleen]

We buy nearly everything using one of two credit cards (one for personal purchases, one for businesses). We pay both off each month and earn rewards for both. I absolutely don't believe I spend more by using a credit card. On the contrary, the more cash I carry, the more likely I'd be to drop a few dollars here and there. I'm not clear why you'd love to stop using yours...?

[StacyWithFourRugrats]

Mainly because it is just easy to take out the card and buy something without realizing how much you are spending. I am HORRID at a budget and can never seem to keep to one. That said, we really don't spend a lot beyond the necessities. Just never seem to be able to balance out.

 

*IF* we move to Europe, I need to figure out how it will affect our credit card. I know you can use your cards over there, but it may not be advantageous to do so with possible fees. So we might be forced to stop using it.

[Colleen]

I just think about money management being easier with a credit card. It is true that when I was younger and in college I really should not have had a card because I charged left and right and only paid the minimum due. As far as Europe is concerned, in my experience, credit cards are far less common over there than they are here. As recently as ten years ago a lot of places I went to there didn't even take cards; that's starting to change. But in CH the most common form of payment is cash. You even pay bills with cash ~ at the post office!

 

Where in Europe are you considering moving?

[StacyWithFourRugrats]

We are considering moving to the Czech Republic where my husband's company has an engineering office. I am pretty sure we would need to then move away from the cards because as you said they aren't used as often in Europe.

[Renthead Mommy]

We always used our credit card for everything. (Except of course chick fil a till they when CC friendly.) We have three. The one we use, the one that comes with our ML accounts (which we really don't use) and the one that comes automatic with Club membership. (We never use that one, but flashing it gets us a discount on many things on base.)

 

We pay it off every month. I wouldn't spend less if I used cash, I'd just have to go get more cash more often. And then I'd end up writing checks for things because I wouldn't have enough cash on me. Like the grocery store. How are you supposed to know how much money you are going to spend at the grocery store before you get there and get the cart filled with what you want? Or you're out and see something you need. If all you've got is cash on you, and it isn't enough cash, then you have to find an ATM, get more cash and then go all the way back. Credit cards are much easier.

 

I always kept cash on me for things like drink machines and if we are just picking up one happy meal or something. But by the time it hits $10, I usually use the credit card.

 

About using cards oversea - we've used our cards off base, but sometimes there is a transaction/conversion fee. On base it doesn't affect anything. And off base we use it pretty much only for dinners out. I do carry yen with me. I've got my regular spending yen, plus my emergency yen in case I run out of the regular. But I always try and keep about 1000 Yen ($100) on me just in case somehting happens out in town. The areas around the bases are more cc friendly, but from what I've read/learned cc aren't something the Japanese use often. You would think they would use them more, as anything less than 1000 yen ($10) is all in coin and those add up quick and become a lot to carry around.

[dirty ethel rackham]

I do it for both reasons - convenience of not having to worry about cash (once cash is lost or stolen, its gone) and for the rewards. We will take our family on vacation this year with our rewards. It also has paid for my airfare for a couple trips as well.

 

I my spend a little more because of it, but not much since I am rather conservative in my spending. One thing I love is that the credit card company keeps track of what I spend and it categorizes it for me. At the end of the year, I get this cool statement breaking down my purchases for me. Also, I can download the info into quicken and it saves me time.

 

Haven't read Ramsey, but it works for us.

[Amy loves Bud]

We use them for everything we possibly can. I rarely use cash. We've never carried a balance in 15 years of marriage. We have no other debt, either, so I'm pretty comfortable with using it. We're not big spenders, so I don't really think it makes us spend more than we normally would. Bud is the type who will drive to a different convencience store for a cheaper coke. And use a credit card to pay for it!

[mcconnellboys]

I did this until the beginning of January, when I stopped cold. I paid for everything with charge because I did not like to handle/carry cash. But as you said, it's easy to spend freely when you're never thinking about the amount of cash you're carrying, so I stopped. I'm finding that handling the actual money and seeing how much I have left allotted within each categoy I set up for myself during the week helps keep me honest and accountable.

 

We do carry some debt. We also have investments that could easily be liquidated to pay off that debt, so our assets do outweigh our liabilities. We simply carry it for the sake of our convenience, rather than switch money around all the time. So I'm not doing this because I'm maxed out on debt or anything.

 

I'm doing it because I want to be more fiscally conservative and responsible in my daily life. I'm doing it to help teach my children lessons about budgeting (and they're taking it quite well, actually, LOL). And I'm doing it in order to help myself think more deeply about spending money on stuff - stuff I might not really need to buy, for whatever reason.

 

I earn a ton of bonus points on my account, which could be used in a variety of ways, including cashing it in. But if using the card causes me to spend money in careless ways, then I'm really spending money to make money.... I'd rather just save my money to begin with....

 

Regena

[Jennifer in NH]

We have 2 cards. One is used only online and one is used everywhere else. We pay for everything with them and we do pay them off in full every month. We have never paid any interest or fees.

jenny

[CookieMonster]

So how many of ya'll are like us and use the credit card for all purchases and pay it off every month? Do you do this because of the credit card perks or just because it is easier to use a credit card than carry around cash?

 

We do this.

 

We don't carry cash.

 

But we limit our credit card spending to pre-set budget limits.

 

And we do get some great points for free merchandise...that's a bonus.

[chiguirre]

One downside I can see with cash spending is always having to find your bank's ATM. If for some unforseen reason you have to use a different machine, the fees are HUGE. I once had to pay $2 to withdraw $50 because I was going to buy some curriculum at a garage sale and I didn't have enough cash with me and my bank was a 30 minute trip. It was worth it to take advantage of the bargain, but I'm glad I don't have to worry about this normally. Those fees are a serious impedement to paying with cash.

[StacyWithFourRugrats]

One downside I can see with cash spending is always having to find your bank's ATM. If for some unforseen reason you have to use a different machine, the fees are HUGE. I once had to pay $2 to withdraw $50 because I was going to buy some curriculum at a garage sale and I didn't have enough cash with me and my bank was a 30 minute trip. It was worth it to take advantage of the bargain, but I'm glad I don't have to worry about this normally. Those fees are a serious impedement to paying with cash.

 

This is one of the reasons I LOVE USAA. You can use their atm card at ANY banks' ATMs. USAA does not charge you a fee and they refund the fee from the other bank (up to $2 and a certain number of times a month...we have never used it more than a few times anyways).

 

USAA just rocks. Except that their credit card doesn't have the nice 2% perk for the 529(k) that we get from Fidelity.

[mcconnellboys]

But do you think using them causes you to sort of become distant from the actual cost of things and spend more than you would if cash were passing through your hands? That's what I began to think I was doing.... However, I'm finding that I have no trouble staying within my budget, so either I'm highly adaptable, LOL, or maybe I wasn't spending as much as I thought I was....

 

Regena

[Laura Corin]

We have a Cathay Pacific credit card and it pays us air miles.

 

Laura

[Kari C in SC]

We use our cc for everything. We earn rewards that have been great to have. Ours is a Choice Hotel Visa through Bank of America. So, I just transfer from my checking once a week to cover whatever we have charged. That way I am not surprised with a larger bill at the end of the month. I wouldn't like charging everything if I could look at is online along with my checking and savings account. This really helps me keep perspective on our budget.

[WTMCassandra]

We've done this for years. One of our cards we get a percentage back on everything, and one of our cards we get a percentage back on gas. I figure it lets my money work for me earning interest for 30 more days ; ). But we always pay it off every month.

[imeverywoman]

I have noticed that when I pay cash for my groceries, my bill goes down SIGNIFICANTLY!!! I mean by hundreds of dollars. It's crazy, I know, but true.

 

My dh especially likes the fact that we get an end of year report for tax purposes, etc.

[Colleen]

But do you think using them causes you to sort of become distant from the actual cost of things and spend more than you would if cash were passing through your hands?

 

I know you were asking this of someone else; pardon me if I'm butting in. I am just so interested in how each of us responds differently to different methods of payment. Using a credit card to pay for my purchases does not make me feel distant from actual costs at all, nor do I find it causes me to spend more than I would if I paid cash. I don't know if this is because I already do give a good deal of thought to what I'm buying, what it costs, etc. Or if it's because I've reached a point in life wherein cash really holds no meaning. When I was younger, actual dollar bills bore that connotation of "cold, hard cash"...MONEY! Now I view it as merely paper. Once I get that credit card bill and review my purchases for the month, that drives home what I'm doing with my money.

[Renthead Mommy]

Originally Posted by mcconnellboys

But do you think using them causes you to sort of become distant from the actual cost of things and spend more than you would if cash were passing through your hands?

 

For us no, not at all. I still know how much I spent, and it's easier to keep track of with the cc. But it's just another form of money. (Whether it's Dollar, Yen or Plastic, it all comes out of our account.) Once I've swiped the card, that's the same as spending the money to us.

 

But we also don't have a budget for anything. I spend whatever I want/need to spend at the grocery store, on clothes, school stuff whatever. Now that's not to say I go buying top of line steak and lobsters and things every week. I buy what we want, and I will look at things and say "No, not worth it at that price." But I don't have any kind of budget to stick to. And there are times when we spend more one month, so we cut back the next month.

 

And I don't mean that as "oh we have so much money we don't HAVE to budget", I mean we are responsible with our money. We don't run up interest. We keep our cars. We buy very little in clothes. We rent reasonably sized houses (we're military so we move often so we don't buy). We don't buy tons of toys (kid or adult). We tend to use the library over buying off amazon. We kept our family size small. Just because something is old, doesn't mean it needs to be replaced for newer and shiny if it works fine. We just live below our means instead of beyond.

 

That said we put money in investments, college fund, retirement accounts, and savings. But I think if I had a budget, it wouldn't change much. For instance right now we pay monthly for Japanese lessons and Kumon Math. So technically our 'budget' for stuff like that is $100. But come summer when we add in things like piano lessons, and it goes up to $150, it's not that we are out of our budget, the 'budget' has just been changed. So like I said, we don't really have a budget as much as 'this is what we spent this month'.

[Spring Pea]

Yes, using credit cards causes my family to overspend--repeatedly. We have changed our evil ways, cut up the cards, and come up with a payment plan. Someday, maybe, I can have the discipline that you all have. For now, I keep my grocery budget under $70 by only having $70 in my hand! Otherwise, it's just too easy to say, oh, $72.89 is close to $70. . .etc.

[LMA]

But do you think using them causes you to sort of become distant from the actual cost of things and spend more than you would if cash were passing through your hands? That's what I began to think I was doing.... However, I'm finding that I have no trouble staying within my budget, so either I'm highly adaptable, LOL, or maybe I wasn't spending as much as I thought I was....

 

Regena

 

We don't spend any more than as if we were spending cash. I think twice about every purchase and I check my account online to see where the balance is going. I like the extra protection from using the cc. I have had a couple cc disputes every year and the cc company took care of the problems. If I wanted to return something without a receipt, I just bring in my cc bill to show the transaction or the store will look up the transaction with the card. It's more protection than using cash. Like anything, you need to have will power not to spend more than you normally would.

[krisp]

We use cc and pay them off at the end of the month. Oddly, for my dh, he's much MORE likely to spend money on nothing in particular if it's cash. Ask him at the end of the day what he put on his cc and he can tell you, ask what happened to the $50 he just took out of the ATM and he has NO IDEA. We have an Amazon Visa and a Discover and switch off depending on the time of the month (at least I do, dh just uses the Amazon).

 

When I got my first cc (Discover when I was in college), my dad signed for it with me and told me that if I EVER put more on it than I could pay in a month, he would drive to Houston (from AZ) and take it away from me. (and he meant it ;) )

 

My dad has his credit cards all figured out. He knows when the closing date is for each of them and times his spending accordingly so that he can use someone else's money for the longest time. (and he usually has the money in the bank before he charges it....he just wants to use someone else's money for a while before he pays it) He's the reason that Dave Ramsey's credit card advice bugs me....it's too one size fits all and doesn't take people like my dad (or anyone else who pays off their card monthly) into account.

[gardening momma]

So how many of ya'll are like us and use the credit card for all purchases and pay it off every month? Do you do this because of the credit card perks or just because it is easier to use a credit card than carry around cash?

We do. Both reasons you gave.

[dirty ethel rackham]

We do. I have 5 airline tickets waiting to be used as rewards. I probably spend a little more using the cards, but we are pretty frugal and don't make a lot of impulse purchases (except, maybe, food:)).

[Desert Rat]

We use ours for gas and curriculum mostly. We pay in full every month. We've been thinking about switching ours to a rewards program. Not to steal the thread, but does anyone have a rewards program they really like?

[KingM]

and I agree with another poster....I ger REWARDS, LOL. I pay all of mine off each month though....never have paid any interest...so they aren't making money on me.

 

They do make their money, though. As a small business owner, I can assure you that. Every time you use your card, they nick a little bit off the purchase price.

[gardening momma]

We use ours for gas and curriculum mostly. We pay in full every month. We've been thinking about switching ours to a rewards program. Not to steal the thread, but does anyone have a rewards program they really like?

We just switched to Capital One recently, from World Points. With World Points we were getting points that we could redeem for merchandise, gift cards or cash (a check). Cash was the best value per point. I think we got different % rates depending on whether the card was used at a gas station, grocery store, etc... Can't remember.

 

With Capital One, we're getting cash back only and at a better rate than we were with World Points. There might still be a different % depending on where the card is used--another "can't remember." We can request a check anytime we want, I think.

 

And another thing we like is that with Capital One we were able to upload our own photo for the card image. We chose a picture that we took at a vacation spot, to remind us that we want to save to go back there. Dh originally wanted to put a picture of dc on the card, but I said no, I'd just want to buy more for them everytime I saw their pic on the card!

[gardening momma]

They do make their money, though. As a small business owner, I can assure you that. Every time you use your card, they nick a little bit off the purchase price.

They're making money off the seller. Of course, that affects prices too.

[Lolly]

I use mine whenever possible. I just cashed in my points for a huge, undisclosed amount a couple of months ago. I couldn't believe how much $ had accumulated...:D

[Mommyof4ks]

I do it for the perks, but since cc companies are slowly cutting back on those we will probably do away with them next year.

[JFSinIL]

I get $600 a year in gift certificates to use at Amazon from my Amazon Chase Visa. I use it for everything and pay in full each month. In fact, just ordered my ds an I-Pod Classic for his 18th b'day (and as payment for scraping/painting the house) using my stash of certificates.

[Margo out of lurking]

So how many of ya'll are like us and use the credit card for all purchases and pay it off every month? Do you do this because of the credit card perks or just because it is easier to use a credit card than carry around cash?

 

Charge almost everything, pay it off every.single.month.

 

The payback is nice; I am glad to not carry cash. I used to write checks for the grocery store until my checking account was compromised, and check fraud alerts followed our names even when we switched accounts. That's when I started using my card at the grocery store too.

[Jill- OK]

Mainly because it is just easy to take out the card and buy something without realizing how much you are spending.

 

...to avoid this is to keep your receipts in your wallet, and inventory each week (month, whatever) to make sure you're not exceeding your budget.

 

Of course, if you have other reasons for wanting to move away from credit cards, you should do it...but I love the return we get, and I think it's completely possible to keep spending under control using them.

[gardening momma]

and I think it's completely possible to keep spending under control using them.

Like stay home (and don't order via internet either). :D That's how I'm currently controlling my spending.

[elise1mds]

because of the cash rewards that we get. But, we pay it off every month. I don't think it makes me buy more than I normally would because I just think of it as cash.

 

That's exactly what we do, too. We get airline rewards on our joint card; DH gets cash back on the card that he uses ONLY for work expenses (and is therefore 100% reimbursed monthly). We never have carried a balance or paid interest. There are times it actually saves me money because it keeps me from going to the store for little $5 purchases since I feel stupid using a credit card for tiny little amounts like that and I try to use cash only for specific things. It's cut my Starbucks habit to about zero!