living without credit cards

[C.Ann]

We haven't used credit cards in quite a few years - stopped right after I received a $5500 Amex statement from a wdw trip. It was an extended stay back when DD19 did workshops and dance nationals in Orlando every summer. During the time we were away, I was very careful to be sure I knew what the closing date on the statement was and coordinated our hotels check-in/out to be sure they'd fall on two different statements.

I thought I had the caught the mouse by his tail and we ate very well b/c we'd be able to pay half each month instead of all of it on one statement - until I got home...
Imagine my surprise when we returned to find that they'd chosen that particular month to switch our statement dates and I had just two weeks before the entire bill of $5500 would be due in full.

That's a check I still remember writing because it was so unexpected all at once. It taught me a lot. We only use our debit card or cash for vacations now and don't use CCs at all anymore. We've stayed in all levels of resorts, and cruised as well. I've never had a problem checking in with a debit card.

Sorry you got caught in the old "switcheroo" - something the CC's are doing even more frequently now.. Look on the bright side - you don't have to devote your life to monitoring what kind of tricks they have up their sleeves next..

 

[kathyell]

I'm really sorry if I'm repeating information (really harried today and I don't have enough time to devote to reading the answers you already got) but if you have a Paypal account (don't need a CC for that if you link a bank account to it) you can get one-use CC numbers from them when you absolutely need a CC for something. It won't work if you need to show the card later (I know some car rental places require this when you pick up the car) but it might work for you for other things.

You may also want to consider keeping the one credit card you've had for the longest amount of time open just for credit score reasons, and to have one as a backup in case of a real emergency. One of the big factors in your credit score is length of credit history, and if you close the credit account you have had for the longest length of time, your credit score will drop. Freeze the CC in a block of water if it will help you not use it.

Oh, and it's worth noting that consumer protections on debit cards are nowhere near as strong as those that protect credit card users. If an unauthorized charge is made against your debit card, the money is debited from your account until the investigation is complete and decided in your favor. In most cases, if an unauthorized charge is made on your credit card and you file a fraud report on it in a reasonable amount of time, you do not have to pay that portion of your bill unless they finish their investigation and for some reason decide against you. There are also some extended warranty protections offered by some CC issuers that you don't get with a debit card, and if you pay for a product or service via CC that is not provided to you, you can file for a chargeback which means you do not have to pay that portion of your bill unless the CC company investigates and decides against you for some reason. If you used a debit card for any of those types of transactions, you are not protected as a consumer with the same protections you would have if you used a CC. Just some things to think about with regards to going CC-free, and I think it's important to weigh all the options before you decide.

 

[Resseda]

One note on the "keeping one open just in case"...I had a cc at one point that just lived in my jewelry box. Had it, opened it, it was a "just in case" card. I used the card to buy a case of wine before my wedding, and then took it with me to Florida to put the rental car on, since it had a higher limit than the one I used day-to-day. It was flagged as suspicious usage and I stood crying the in the Hertz office in Orlando trying to explain my story.

Now, I'm down to one CC that I use for gas. I figure, it will get a couple uses a month, and I pay it off about weekly. I never want to go through that humiliation again.

Ress

 

[PrincessSuzanne]

One note on the "keeping one open just in case"...I had a cc at one point that just lived in my jewelry box. Had it, opened it, it was a "just in case" card. I used the card to buy a case of wine before my wedding, and then took it with me to Florida to put the rental car on, since it had a higher limit than the one I used day-to-day. It was flagged as suspicious usage and I stood crying the in the Hertz office in Orlando trying to explain my story.

Now, I'm down to one CC that I use for gas. I figure, it will get a couple uses a month, and I pay it off about weekly. I never want to go through that humiliation again.

Ress

All you have to do is call the CC company and explain tha tyou are going out of town and that won't happen. they do that because they probably thought someone had stolen your identity. We took a CC with us in June that had a $0 balance and I just called them and let them know that we were traveling and may use it, so that didn't happen, took less then 5 minutes and no embarrassment.

Suzanne

 

[Dancemom03]

All you have to do is call the CC company and explain tha tyou are going out of town and that won't happen. they do that because they probably thought someone had stolen your identity. We took a CC with us in June that had a $0 balance and I just called them and let them know that we were traveling and may use it, so that didn't happen, took less then 5 minutes and no embarrassment.

Suzanne

It doesn't hurt to call the bank for your debit card and let them know you'll be traveling as well. I did that this month and they added it to my record in case there was a question, just like if it were a cc. Having the computer lock it while we were in transit, filling up with gas & food over 7 states, would be a nightmare since that's our bank account too...

 

[SandrA9810]

We just use our bank card as a CC since it's tied to Visa, and you get the same benefits as being a visa cardholder.

Our biggest problem with cards is gas stations. Some gas stations will ping your account for only 1$ or up to 75$, and sometimes you can only pump so much worth of gas if you pay at the pump. I always go inside and tell them the amount I want to pre purchase, so my account is only charged with the amount I want. If I'm filling it, I try to guess as close as possible, but if I do go over, then I just go back inside and they credit the difference to my card. Although race trac will give cash change if you purchase gas using it at debit. I always hated calling the automated banking to hear my balance is 75$ available balance is 55$... but I just put 45$ worth of gas, but until that transaction goes through, the bank thinks I have 55$ available for spending. And then if I make an 15$ purchase... well I just got myself an over the limit fee. I had too many of those, and now it's worth the walk inside to prepay for gas. No more paying at the pump, unless it's horribly raining and there's no cover from the pumps to the store.

I can't think of any bank that doesn't allow for a visa/debit card or mastercard/debit card. If you're doesn't, you might want to look into getting an account that allows for it. We rarely use actual CCs anymore, all our purchases are made with our bank card. It is possible to live CC free. Although most people are very good about paying off monthly, and earning the rewards... I'm not one of them.

 

[Colleen27]

I have a prepaid card that I use on occasions when I would prefer to use a CC rather than my debit card, like for traveling or shopping online. That allows me to minimize the potential for fraud/theft damage (my debit card has many of the same protections, but I'd rather not hassle with being out the money while it is straightened out) and avoid holds on my day-to-day funds without keeping a CC open.

 

[natashag76]

I don't know if I'm repeating info or not, but j.i.c., you should try to keep more than one open, even if you don't use it. And, you should use them only once every 6 months or so. It doesn't have to be a huge purchase. That way you maintain a good credit rating, because if in the future you need to buy a car or a house, you'll have a good credit history. If you close all your accounts, or don't use them (then the cc co's close them for lack of use) you have no credit history at all. And the credit trackers like transunion, experian and equifax, don't list who closed the account and why, only that it is closed. just my 2 cents.

 

[dd50]

I'm really sorry if I'm repeating information (really harried today and I don't have enough time to devote to reading the answers you already got) but if you have a Paypal account (don't need a CC for that if you link a bank account to it) you can get one-use CC numbers from them when you absolutely need a CC for something. It won't work if you need to show the card later (I know some car rental places require this when you pick up the car) but it might work for you for other things.

You may also want to consider keeping the one credit card you've had for the longest amount of time open just for credit score reasons, and to have one as a backup in case of a real emergency. One of the big factors in your credit score is length of credit history, and if you close the credit account you have had for the longest length of time, your credit score will drop. Freeze the CC in a block of water if it will help you not use it.

Oh, and it's worth noting that consumer protections on debit cards are nowhere near as strong as those that protect credit card users. If an unauthorized charge is made against your debit card, the money is debited from your account until the investigation is complete and decided in your favor. In most cases, if an unauthorized charge is made on your credit card and you file a fraud report on it in a reasonable amount of time, you do not have to pay that portion of your bill unless they finish their investigation and for some reason decide against you. There are also some extended warranty protections offered by some CC issuers that you don't get with a debit card, and if you pay for a product or service via CC that is not provided to you, you can file for a chargeback which means you do not have to pay that portion of your bill unless the CC company investigates and decides against you for some reason. If you used a debit card for any of those types of transactions, you are not protected as a consumer with the same protections you would have if you used a CC. Just some things to think about with regards to going CC-free, and I think it's important to weigh all the options before you decide.

Very well said. If you have no cards (closed out) they will fall off your credit report after 10 years and you will have no score. FICO scores are used for insurance (car and homeowers), a few don't use it tho, and of course mortgages. The lower your score the more you pay.

I have a cash rewards card and let it give me money. I pay in full every month, usually twice a month and earn cash. CREDIT DOES NOT EQUAL DEBT.

 

[Kriii]

dh and I had a discussion this week where we decided to go back to using a cc instead of debit...we pay off in full every month so no worries there. Our original reasoning was to use debit so no temptation to overspend and we only used ccs for certain things, like car rentals etc. (we've had balances in the past so I do understand why some posters are fearful of using cards)We've encountered problems with "holds" on funds over and above the amount of charges, which has resulted in overdraft fees when we spent money we "thought" we had. Debit card was once stolen and large amount of money was spent before problem was stopped (bank did not refund entire amount stolen). FInally, we were missing out of gas rewards and didn't have the same purchase protections. I know we have to watch the cc company like a hawk, as they have sneaky ways though. We have 3 cards, two are locked up and have been inactive for at least two years. We only use the one. Not closing any accounts b/c the FICO needs to stay strong! FICO does matter...just bought a house and w/o a good FICO we wouldn't have gotten the low interest rate. ALso, emergencies away from home have arisen in the past where having a cc was a lifesaver.

 

[dd50]

dh and I had a discussion this week where we decided to go back to using a cc instead of debit...we pay off in full every month so no worries there. Our original reasoning was to use debit so no temptation to overspend and we only used ccs for certain things, like car rentals etc. (we've had balances in the past so I do understand why some posters are fearful of using cards)We've encountered problems with "holds" on funds over and above the amount of charges, which has resulted in overdraft fees when we spent money we "thought" we had. Debit card was once stolen and large amount of money was spent before problem was stopped (bank did not refund entire amount stolen). FInally, we were missing out of gas rewards and didn't have the same purchase protections. I know we have to watch the cc company like a hawk, as they have sneaky ways though. We have 3 cards, two are locked up and have been inactive for at least two years. We only use the one. Not closing any accounts b/c the FICO needs to stay strong! FICO does matter...just bought a house and w/o a good FICO we wouldn't have gotten the low interest rate. ALso, emergencies away from home have arisen in the past where having a cc was a lifesaver.

For the two you have locked up use them about every 3 months for something. Tank of gas, movie tickets, etc. so they don't close out your account.

 

[CJMickeyMouse]

Why live without credit cards.... when you can use them responsibly and benefit from the rewards???

The amount of cash back you receive is enormous.... and discounts (such as through shop Discover) as well.

If we don't have the cash... we don't charge it. And we have not paid a cent of interest on a credit card. Ever. It can be done!

 

[snarlingcoyote]

I couldn't function without a CC. I travel with work and file my expenses. I could get a company Amex and charge, but I'm currently also allowed to use my "personal" card. My personal card has better rewards than the company AMEX, so I use it, but either way, I MUST have a CC.

I suppose I could just keep a reserve in my checking account for trips, but honestly? I don't want to have that in my checking account. We transfer our surplus (beyond a reasonable "float") into savings.

Also, my CC has v. good benefits, like $0 theft, assistance with buying, good customer service, etc. I was in an odd geographic location once and got a phone call from the CC "We noticed you've got charges in XY. Is that you?" My debit card just put a hold on the card - without contacting me to find out that yes, yes I was in the backend of nowhere and in a city known for international. . .uhm. . .fiscal theivery.

 

[C.Ann]

Why live without credit cards.... when you can use them responsibly and benefit from the rewards???

Why purchase a Chevy rather than a Toyota? Personal preferences..

 

[Dismom55]

We have been married for 36+ yrs and have NEVER had a cc. We do not believe in them and have been very glad when times get tough that we do not have that one more bill to pay. Recently tho I did decide to open just one CC, I opened it simply for the rental we will be using for our trip to Disney this Sept. Here is what I did, I took $800 from savings and opened a secured CC, in our case if something should happen we can close the acct and use the secured money to pay off the CC. I will use this acct for no other reason and have been saving the money to pay off the CC after we return from WDW. Thus avoiding finance charges. This way if money should suddenly get tight, well I don't have to worry over one more bill, just contact the bank and take care of it right then and there.

If I had it to do over, I would make the secured amount just a little larger in case of emergency or to be able to go ahead and charge the hotels while traveling.

What I have done in the past is to use my ATM card for all things that require a CC, I am not so comfortable with that now with so many hacking into acct and such.

We have always paid cash for things except a car and house, that is how we have the money to make an occasional trip to WDW, otherwise we would be mired in debt and unable to go.

Just my opinion, not always easy but we have managed so far.

 

[CJMickeyMouse]

Why purchase a Chevy rather than a Toyota? Personal preferences..

Well, I personally would not buy either, but I definitely won't turn down free money!

 

[kydisneyfans]

Well, I personally would not buy either, but I definitely won't turn down free money!

That's what we do. My wife and I have 17 open accounts between us, and we make less than the average American family income. We get paid over $500 a year for charging stuff we would buy anyway, from fuel to prescriptions and food. Stores are constantly sending out coupons for discounts on the store cards. We spent Saturday doing nothing but going from store to store in the mall getting "gifts" with our $15 off anything coupons from Lane Bryant, the Limited, etc.

Our open credit lines total over $125K. We haven't paid interest in over 3 years on any card. We have 5 different cards through Chase, none of them have been shut down or credit limit lowered. Out of the 17, only the Meijer CC had the limit lowered. We pulled our credit reports last week and we are in the top 2 percent in the nation regarding our credit scores, not bad for our lower than average income.

As for carrying "debt" while using the grace period, if I charge $500 today and it is not due until Sept 15, that $500 goes into an account to earn a few pennies, then it is paid around the Sept 10th. It is not debt.

Having the credit cards open and not using them much works, but it's definitely not for everyone.