When it comes to credit cards, people fall into a number of categories. Some abstain from even owning a credit card, while others own a dozen and maximize rewards and other arbitrage schemes. And then you have everything in-between. Some people carry a low balance, others pay everything off in full each month, and some are carrying a significant debt load. So, I thought it would be interesting to see where many of the readers fall on the credit card usage scale.
We personally fit into two of the poll choices.Currently, we have credit cards, but we don’t currently use them for purchases. They remain open for their long credit history, emergencies when access to cash wouldn’t be available, or for buying things like airline tickets or renting a car. But on the other hand, we also have some credit cards with balances that were incurred/transferred over a few years ago when our business closed and we had to take on that debt. So, it is hard to nail down exactly where we are, but in terms of current usage and purchase patterns, we’re in the have credit, but only use it when absolutely necessary camp. Where do you stand, and why?
Author: Jeremy Vohwinkle
My name is Jeremy Vohwinkle, and I’ve spent a number of years working in the finance industry providing financial advice to regular investors and those participating in employer-sponsored retirement plans.
Wow, I hope those 248 odd people who pay their balance off in full each month are in a majority in the entire population too, just as they are in the sample!
We treat our credit cards as if they were debit cards, albeit with the added perk of cash-back/rewards. We pay them off in full AT LEAST once a month; sometimes more often, since it's so easy to do with our bank's online bill-pay.
I've never had CC debt, and my husband got rid of all of his within the first year we were married.
I think you are missing a category. The, I'm working on paying off my credit cards from when I made poor choices. :)
left of one choice: rack'm up in youthful idiocy/medical er/divorce/lay off & now snowballing them til paid off.
I was bad at one point, using my credit cards for everything, (I blame myself...it's my own fault!) but I always paid more than the minimum payment. I paid them off, now owing $0. I haven't used them in months. They are now used for a reservation or a car rental, and I pay them in full. It's unfortunate that there isn't a class in high school that teaches the kids the wise use of credit cards, creating a budget, the real costs of having debt, etc as a math class. Having no debt, makes for great night's sleep!!
I always pay the balance off in full each month. I never charge more than I would spend with cash. Its just an alternative to cash for me that gives me a lot of benefits. Until I got to college I didn't even know that many people did not pay off the balance in full each month, the whole idea of not doing so is mind boggling given the interest rates they charge. We were raised to never look at credit cards as "credit". Instead the bill is just like any other bill you get each month (mortgage, electricity, cell phone) - you pay it off in full.
I have different credit cards, depending on the rewards. I use the Upromise card for online purchases and bill pay, and the miles card for groceries and every day expenses. And we pay them off each month. Next year, I hope to use my miles to get a free flight to Europe when my husband goes for a conference in Vienna (his is paid for by the school). And there should be enough money for my son to have a year of "free" housing when he gets to college off what we get from Upromise.
I'm in the "use cards but pay it off each month" camp, I'd be pissed if I ever paid a finance charge.
I use my Discover 5% cashback card as much as possible. I hate to agree with a CC company, but I've saved thousands over the many years I've used it.
I don't use credit cards except for online purchases and some automatic payments. Otherwise, it's cash all the way!