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Original poster

credit cards good bad or indifferent

51 replies

Flute56 · 28/06/2023 05:21

I was watching a video where a young person was saying oh its good to have a credit card. I do not have one. My parents never had one. I have been raised on the assumption that credit cards are a bad idea as they encourage debt. Credit cards are for when you do not have the ready cash available and then you pay the card back with interest so you end up paying more. It is the same as a bank overdraft. I do have an overdraft but I tr y not to use it because if you go into your overdraft you pay charges. I butget very carefully so keep within my means and I think that last time I went into my overdraft was about 6 months ago

OP posts:
Original poster
Flute56 · 28/06/2023 05:24

If I want something I save up for it or go without. That is the only way I can live

OP posts:
wobytide · 28/06/2023 05:29

There are various reasons for using credit cards and some of them have merits (I.E. better consumer protection). If people have discipline they are useful. You've just been taught the negative aspects of them.

Willmafrockfit · 28/06/2023 05:32

i am the same,
i have had them but relied too much on them
wouldnt have them now

Buildingthefuture · 28/06/2023 05:32

Bad if you HAVE to use them to fund your lifestyle and you are unable to pay them off. They usually have high interest rates and it’s easy to end up in a lot of debt quite quickly. Good if you can use them strategically. I have 2 that I use for my business, because they have excellent “points” rewards schemes. I pay them off in full each month, so never pay any interest, but accrue lots of points that I can spend on pretty much anything - flights, food shopping, white good, clothes, the list is endless. Personally I keep one credit card with a low limit and a small balance on which I pay the minimum each month. That helps my personal credit rating, should I ever need personal credit.

countrygirl99 · 28/06/2023 05:32

I get cash back on mine when I buy groceries and fuel. I have a direct debit set up to pay in full monthly. If I want something I save up for it and will often stil pay by credit card for extra consumer protection. Credit cards aren't inherently bad it's all down to how you use them.

User163876621 · 28/06/2023 05:39

Good, I have four, I get cash back and points on them, use them for everything and pay off in full each month, also it means if I get fraud on one of them it doesn't affect my cashflow like it would if it was my debit card which I rarely use.

Nesbi · 28/06/2023 05:46

I have 2 which I use for all significant purchases as they both build up Avios points which I can exchange for things like flights. Have built up more than enough points for something like a couple of business class flights to New York.

The balance on both cards gets paid by direct debit as soon as it’s due, so I never pay interest. I’ve been using credit cards like this for probably about 25 years now, as that is how my parents used them.

greenspaces4peace · 28/06/2023 05:47

Mine has no fee if I pay in full, I really couldn’t live without for online shopping/hotel booking/air travel etc.
I collect airmiles which helps. Dh’s card has a cash back scheme.

FormerlySpeckledyHen · 28/06/2023 05:54

Good if paid off in full monthly
Extra consumer protection
Points earned for JL vouchers

Bad if you have no self control over spending.

Cocoaone · 28/06/2023 05:57

Same as above, I have an Amex which I use for day to day spending as it earns cash back, for additional protection and for access to things like concert tickets.
I pay it off in full each month via DD

iamnottoofatiamjusttooshort · 28/06/2023 05:59

I used to think like you - save for what I want
No credit card
No overdraft
No loans

Until I went for my mortgage , they explained to me that credit and how you manage it reflects massively on your credit rating so at that time I was a bit of a risk to them as no history for them to assess

I encouraged my children to use a credit card for a chosen expense , maybe fuel ? Pay that off in full monthly and never be tempted to go mad

It's only a bad thing if you cannot manage your spending

Ambi · 28/06/2023 06:13

I have 5 credit cards, used wisely they are a tool. If they are used as free money to spend as you will then absolutely don't get one.

I have never paid a penny of interest and use credit cards for every expense that I can to earn cashback and for section 75 protection, I also like having 1 payment out of my bank rather than many. I use them as an extension of my current account and is always set to pay in full by DD. I also don't spend if I don't have the money.

I have 2 fee free cards that I use when abroad, 2 cards that earn cashback and 1 fee free balance transfer card that I have £5k balance paying £0 interest, whilst the cash to pay it is in a 4.25% savings account. This should earn me around £285 over the 2 yrs that I have the 0% bt offer.

3luckystars · 28/06/2023 06:16

I don’t think they are good (for the likes of me anyway). It’s like carrying a high interest loan around in your pocket. I don’t have one and never will.

Original poster
Flute56 · 28/06/2023 06:18

greenspaces4peace · 28/06/2023 05:47

Mine has no fee if I pay in full, I really couldn’t live without for online shopping/hotel booking/air travel etc.
I collect airmiles which helps. Dh’s card has a cash back scheme.

sorry but you say you reallt could not live without one???? I do. The only online shopping I do is on Amazon and occasionally I will do a Sainsburys grocery shop when I physically cannot get to the shop. I use my debit card for these online purchases. I check what is in the bank and then work out if I can afford to buy whatever I want online and if I do not have any available funds then I do not buy online. It is as simple as that really. If you are bying for the sake of buying then there is something wrong, I do not live from hand to mouth butI am careful about spending, I do not need much in life and you do not need to spend much to be happy. Some of my clothes come from charity shops and you would never know unless I told you because I only get stuff that look good and are of good quality and for things like holidays I save up for. I am going to Australia this year and peple think I am welll off because of where I am going but for my australia trip I have had to save up for years and now finally have the money go afford the trip

OP posts:
justme2022 · 28/06/2023 06:22

I have one I use for big purchases which is interest free so I pay it off a bit each month with no interest.
My day to day spending goes on one that gets me airmiles and that's cleared every month so neither of them cost me anything in interest.

Clymene · 28/06/2023 06:25

If you pay for things using a credit card, you have much better consumer protection under section 75.

So if your airline goes bust, you'd get a refund had you paid by credit card. You won't because you paid cash.

I hope that doesn't happen obviously but that why I use them! I also get air miles and cash back and I pay them off in full every month. I just use them instead of paying from my bank account.

I hope you've got travel insurance

DisappearingHelen · 28/06/2023 06:27

You’re sounding a little judgemental here. What many of us are saying is we pay them off in full every month. No debt accrued. We use them as we would a debit card. Only we benefit from various credit card perks. There are several benefits you gain from them BUT only if you have the self discipline to budget so that you pay them off every month.

So instead of buying groceries with cash or debit card I use a credit card then pay it off. People who use them to accrue debt are unfortunately going to struggle more with them than those of us who use them to our benefits. You could possibly stand to educate yourself a little more about them 🙂

Ambi · 28/06/2023 06:27

You can still be frugal and use credit cards, if you have the mindset to pay it off straight away. It provides extra protection on purchases (I've made a few claims against broken items or duplicate charge) and you are not risking your bank. If someone clones your debit card, you could lose your money from your bank. If it happens to your credit card, it is easier to flag the disputed transactions without affecting your account balance iyswim.

Probationnotontarget · 28/06/2023 06:29

Wow - judgey there OP?

As PP said, you could’ve had a free trip with airmiles! Could’ve gone sooner.

Other people can spend their own money however they wish in what ever way they wish!

BitOutOfPractice · 28/06/2023 06:33

If you’d used a credit card each month and collected avios points / air miles and paid it off in full each month (and you sound disciplined enough to do just that!) you’d have paid no interest and got to Australia sooner.

the op who said she “couldn’t imagine” life without a CC didn’t say that because she’s a spend thrift living behind her means. Quite the opposite! She’s saying she cannily uses the CC to manage her money and take full advantage of the offers and protection it offers and can’t imagine a different way of managing her finances.

Credit cards are only “bad” if you use them to spend money you don’t have and it runs away with you. Most people use them wisely to their advantage. Like the people here.

AuntieMarys · 28/06/2023 06:40

DisappearingHelen · 28/06/2023 06:27

You’re sounding a little judgemental here. What many of us are saying is we pay them off in full every month. No debt accrued. We use them as we would a debit card. Only we benefit from various credit card perks. There are several benefits you gain from them BUT only if you have the self discipline to budget so that you pay them off every month.

So instead of buying groceries with cash or debit card I use a credit card then pay it off. People who use them to accrue debt are unfortunately going to struggle more with them than those of us who use them to our benefits. You could possibly stand to educate yourself a little more about them 🙂

Exactly! I put everything on credit card, pay it off in full and accrue John Lewis vouchers. Never use my debit card or carry cash.
I consider it being part of being an adult.

iamnottoofatiamjusttooshort · 28/06/2023 06:42

Very judgey OP and totally missing the point several people have made to you

Enjoy your trip , shame you missed out on the free air miles , perks and cash back and increased credit rating as well as security for your holiday

ElinoristhenewEnid · 28/06/2023 06:51

I use my credit cards to pay for purchases online - I do not like giving out my bank details because of the threat of hackers. Have direct debits set up to clear my credit card balances each month so never pay interest.

CatsOnTheChair · 28/06/2023 07:13

By using your debit card online, you are very exposed if the details get taken - your bank account could be emptied.
I use a cedit card for everything, collect cashback, pay it off in full each month. It gives me several hundred pounds a year "free" money.

They can be great for those who don't need them. Disastrous if you are short of money permanently, as they are expensive but offer easy access to spending.

Amboseli · 28/06/2023 07:19

I use mine for literally everything. Never use cash or debit card. Never paid interest. Earned lots in cashback and avios. Can't see the problem.