I got robbed 3k off my debit card for concert tickets being extremely careful with it. It was a whole ordeal, missing scheduled payments while making transfers, and getting reimbursed luckily. Compare that to the no liability credit card, it can be reversed in minutes. I have the 2-5% rewards cards and never carry, but the 'free money' is not why I use it. It is purely to reduce my liability. I completely believe that credit cards will influence you to spend more and that you are one step away from disaster, the studies and stats on this are pretty clear.
Can you explain when interest starts accruing on a balance? For example, I pay off my balance every two weeks and I don't think I am paying any interest. I will also pay more than I owe so that I have a negative balance. Is this a good idea?
I only use credit card, have had fraudulent charges and it just feels far less risky when it’s on credit card and easy to fix. I only use my debit card if I need to make some kind of deposit or something at the bank, just to make sure it’s always the right account… one time they deposited into the wrong account and luckily I caught it by looking at the receipt even though it was correct on the slip… never did it manually ever again. Edit: I do 2% on all purchases… 2% off everything I purchase… with kids, this makes a huge difference.
Credit cards transfer money from customers who don’t use them to customers who do. It’s one of the many ways in which life is far more expensive when poor. -cash back rewards are paid for from the small cut of the transaction that is taken from the vendor with each credit card use -this added cost to stores is passed on to ALL customers, not just to those who pay with credit cards
If you have a well funded emergency fund, you could still be a spender and have a credit card. Makes you a bit of a saver but doesn’t mean you’re maximizing savings for retirement, HSA, etc
If you know what are doing that can pay off their credit card every month or just super rich, use credit. Poor people or no Self control, use debt card.
You're the best. I also charge all expenses I can, even taxes and. Pay them off every few days or weeks, and the balance befoe the due date. Love the rewards.
You can use credit cards as long as you pay it off that month. Advantage is you get reward points and travel points. Disadvantage if you're a compulsive buyer you might max out your cards. I am debt free.
@@RyChOr2005 For me the cash back is a bonus and not the reason to buy, but I travel constantly for work. I've spent more time dealing with stolen debit card numbers than I have with credit cards themselves. There is extra security from the credit card itself. It doesn't change the way I spend money, but for purchases I need to make anyway, a little cash back is better than none. I actually use the Apple Card and the one time it was compromised I found out that by the nature of it's design I did not need a physical card replacement to change my card number. It's now the only card I use while traveling and nearly every purchase I make as long as Mastercard is accepted. I do keep a Visa card for retailers that don't accept Mastercard.
@@Stylez-13you would be able to get a credit card no problem, its just that you will have to start off with a very small credit limit and will have to work your way to increasing it about every 6 months
I’ve used credit cards for 99% of my purchases since I was 20 or so. Never paid interest, never out of my means. 810+ credit score. All the cash back rewards. 😎
If feels good not paying interest on my credit card too(most of the time). In all my years of using cc's I believe i only paid about 300-400$ on interest. But I was foolishly close to my limit all the time so I could never really build my credit. Im a believer that If I dont have at least 50% of the purchase cost on hand(considering all bills are paid and money in long term savings) I cannot afford what I want.
I've been hacked 3 times, with the lastest having all my savings drained because I used a debit card at a gas station. Using a credit card, your money is not at risk for fraud.
@@johnconner8437 It took the bank 6 weeks to return my stolen money while I still had bills to pay. And I had to be proactive in disputing the faulty transactions, while with a credit card it's easier to dispute and they do most of the work.
People often seem to forget that swiping a debit card is just as emotionally painless as swiping a credit card. The whole "credit cards make you spend more" argument applies to debit cards as well. People also seem to forget that if you stick to a budget, the way you pay for stuff doesn't really matter. So you might as well get 2% back on everything.
the people who dont need to see this video are people who got their finance under control so it dont matter which for of payment they use. the people that need to see this type of vids are the people that is part of teh $1.4 trillion CC debt.
Nah. If I have 3k in my account and my insurance payment is due, I am not going to get down to the danger zone but if I know I have 3 credit cards with 10k limits and I can if needed carry the balance then I will never not be able to pay bills that require debit. It's the feeling of the remaining access to funds.
With debit cards, what worries me is that it's linked to your bank account and if it's stolen, it takes at least 2 weeks to get your money replaced from the bank.
I understand your points, but I cannot be trusted with a credit card based on my past history. When things are good, I forget to pay things off; when things are not so good, I spend too much. I am the big dumb.
As a general rule, I agree with David in that most people should avoid credit cards. I’ve used them responsibly for years, however I have made some bad choices in the past by getting services now instead of waiting until I had the money. I’ve also had buyers remorse having used a credit card when I wouldn’t have made the purchase with cash at the time. Also, when I use the debit card I see that balance go down immediately and it causes me to be more conservative with my spending.
Dave Ramsey advice is for financially incompetent folks who are deep in debt. If you know you are financially responsible, then there’s nothing to worry about and a majority of Dave’s advice is pretty god awful.
This is where you're wrong. The advice that people who have credit cards spend more is true for everyone. This has been proven to be true. If you get an offer for 5% on a $2000 spend. You're going to find a way to meet that threshold and I can guarantee you more than 5% are going to be spent on items you could have done without.
@@ret4kind got proof to back up that statement? Because my American Express statements say otherwise…and again…if you spend more with a CC but still pay it off every month, why does it matter? I’ve racked up enough points on my card to travel to Japan and back home TWICE and I have never got a late fee or interest payment.
@@PrimitiveAK "if you spend more with a CC but still pay it off every month, why does it matter?" "if you spend more with a CC" "spend more with a CC" "spend more"
Yeah he also prioritizes paying tithing, withdrawing 8% annually on retirement, and constantly downplays financial struggles that young people face that his generation didn't. Bad advice and out of touch. Ramsey isn't worth listening to unless you're a massively indebted middle aged+ religious person.
I started working with Miss Walter after I got a loan from a friend and now after receiving profit, I paid my friend and put back my earnings over and over again. I must say she's a very transparent and an honest personality
One of the Ramsey points is that they believe the points are “scummy” since the reason they offer them is because someone isn’t able to pay their card and pays interest which allows you to get benefits.
I mean that same logic could apply to the high yield savings accounts they advertise. You only get the interest because someone else is paying a higher rate of interest on a loan.
That's only half true. Credit card companies make money in more ways just interest on unpaid balances. Amex, for example, makes most of their revenue from interchange fees. And besides that most credit cards are issued in partnership with banks. Banks have many revenue steams, and high interest credit card debt is only one part of that. Even if they didn't make any money from people not paying their credit card balances, they'd be paying out points on credit cards. Sure, it'd probably be at lower percentages, but the points would still be there.
It’s also scummy that companies don’t allow you to be fully vested in your 401k until you’ve worked for them for 4+ years, does that mean I should just not donate to my 401k and collect the 4% match of free money?
I use a single credit card for everything. Get 5% back on gas and restraunts, 3% on groceries, costco, utilities, and 1.5% on everything else. I get back roughly $2.5k each year.
In my own circle of friends, the ones who get into credit card debt have much more going on in their lives that just overspending. They have health issues, self-esteem issues, employment issues, family that sucks they dry, drinking problems, partying too much, not giving a crap problem, and definitely math and not knowing any better problem.
All my friends who use credit cards are broke, living paycheck to paycheck and have debt up to their eyeballs. My other friends who use debit cards own homes, have investment nest eggs and are living their best lives. Not sure if correlated to owning a credit card but I’d rather be in the latter camp.
Where I live (the Netherlands) creditcards don't give any type of rewards. The only reason I have a creditcard is for when I'm traveling outside of Europe or if I want to buy something from foreign websites.
Its probably because you have legal laws on how much interest can be collected on credit cards or the culture means everyone is educated on the ways to debts, so no one is dumb enough to buy things they can't afford on revolving accounts with 20% interest rates. The rewards are there to entice people to buy more and hopefully not pay them off to collect interest, which actually does work on many people.
@@rebeltheharem7028 we do have different rules and laws, also we do not have an american style credit score. Also a culture of not spending more money then you have, altough the younger generations are going for car loans and lease plans, i'm from the 70's we learned to save up before buying something, only a mortgage is acceptable as a debt
I am also Dutch and from the '70's. Indeed do not spend more then you earn and ask yourself the question: do I really need that (item). Most, if not all adults in our Netherlands have a debit card. Most do not even walk around with cash. Or they use their mobile phone. A credit card is good to pay the toll on the highways in Italy and France. Also in our country almost no shops accept them. Shops want to be paid by debit card because it is faster and they do not have to count the money at the end of the day ( costs time) and they can not be robbed because of having cash in the shop. Almost nobody accepts 200 or 500 € bills.
I'm from Barbados and we really only get points and rewards with the high end credit cards(gold,platinum and black cards)not everyone can afford to have those cards.with the normal credit cards,we don't even get any rewards.
@@abelfaber4457Bonus Fact: The Netherlands Banks will lend you more money than what your house is worth (great for the individual, but not so much for their economy) - TH-cam Economist “economics explained”
I usually look up your videos for updates! Our government has no idea how people are suffering these days. I feel for people with disabilities not getting the help they deserve. Thank you Mrs Emily L Romano, imagine investing $12,000 and received $305,500.
Mrs Emily L Romano was my hope during the 'bear summer' last year. I did so many mistakes but also learned so much from it, and of course from Emily L Romano.
the first step to successful investing is figuring out your goals and risk tolerance either on your own or with the help of a financial professional but is very advisable you make use of a professional
I racked up about $18K in credit card debt. First thing I did was stop using credit cards, transferred it to a 0%, and went all cash with a debit card. Down to $2500 and once that’s done will have no consumer debt at all. Will once again have control of my full income to devote to e-fund and investing.
If fraudulent activity happens on your credit card, it's the bank's money that is in jeopardy. If fraudulent activity happens on your debit card then it's your own personal money at risk. Sure, issues could be resolved with your checking account but if the balance gets drawn down it may cause other bills to bounce in the meantime.
I used to have 12 credit cards. Now I am down to 8. I mostly use my main 2 credit cards for gas, restaurants and groceries. I get 3-4X points back in these purchases. I pay off these purchases weekly. I also use my debit card sometimes as needed. Both have different use cases. Thanks for all the great videos you put out!
I am very disciplined, pay my cc card off faithfully every month and benefit from the cash back and rewards on the CC. I have never used a debit card in my life and most likely never will. Paying no interest and having better protection by using the cc is better for me and my choice. I have never paid cc interest in my life. Larry, Central Valley, Ca.
1:42 I remember a 60 Minutes show with Moreley Shaffer where his credit card insider guest said guys who pay their balance every month are called "deadbeats" 😂😂😂.
The fact there are tons of people who don’t have credit cards, but are in debt with cars, homes, or other loans proves it doesn’t matter, a financially irresponsible person will always be financially irresponsible, with or without a credit card.
Nope. Using cash means I can only use up what I have in my bank account. With credit cards I can borrow up to my credit limit which is more than the average person has in his bank account
A debit card can also be run as a credit card as long as it has a credit card company logo on it like VISA. debit cards will always be useful because you might misplace your money or get robbed if you carry cash only.
Something overlooked is the vendor fees, credit card companies make a significant part of their profit off of charging vendors processing fees! Great video Humphrey as always!
The only correct payment method is carrying around a million dollars cash in a metal briefcase with you everywhere you go, but I don't have that kind of money, nor do I own a cool briefcase, so I just use a credit card. I pay it off weekly.
I hope u are paying the full balance 🤣🤣 like I do and I pay the full balance a day before the closing date not due date the statement closing date I hope u kno the fuckin difference 😌😌
I use a Debit Card. I hate Credit Cards(CC); you pay twice, once when you make the purchase itself and then again when the CC statement arrives. The banks really want you to use CC making it easy to use while making large purchases with Debit Cards harder all so you can end up making interest payments. The bank likes to use fraud protection as an excuse but the fact is your Debit card offers nearly as much fraud protection as the Credit Card. Contrary to the comercials on TV, CC companies are not always that eager to refund you your money when you've been a victim of fraud.
Credit cards are incredibly useful because they pay you reward for spending money on it so as long as you know how to use it. Travel cards are a flex for myself personally.
Debit card is also good for the times when some services charge fees if you use a credit card and not a debit also to use withdraw cash at the bank or ATM (excluding using your phone app) and also some debits have rewards programs. Overall though a credit card is preferred.
I think the real issue at hand is, people view finance as a one size fits all situation. Whether a credit card is right or a debit card, it’s up to the individual to make the best decision for themselves.
One of the overlooked factors. Refunds and fraud. When you dispute a debit card charge - you begging the bank or business to give you back your money. With credit - you refusing to pay. I know it’s subtle. But there’s a huge difference. Banks are not incentivized to return your money.
@@TheThreatenedSwan I disagree that it’s shorthand. It’s misdirected. It treats the symptom instead of the root of the issue. It blames the object instead of the actions taken by the individual. Would be more beneficial to fix the flawed psychology, then to limit one’s options.
The idea behind it is greed. Look up some old documentaries on credit cards and how it started and why. Banks consider people who use their credit card wisely deadbeats (actual term) and don’t like them. They prefer people who overspend and pay interests as that is what makes them billions. All the benefits are meant to lure people into the trap and sadly most people fall into and can’t get out easily.
@@GlitterSn1ffer it’s just impossible not to have late fees etc, replace with credit card, same convenience, but you keep your money till the end of the month and pay in one bulk payment, when you use debit card say pay for gas, they place a hold for $100 then charge you say for $50 so really $150 hold for $50 of gas until the hold falls off, then you end up being in the red, subject to late fees, Also if there are any fraud charges they come direct out of your account with debit card so money is essentially gone,with credit they aren’t paid so you have more time to contest and stop payment,
I really like that he hit on the credit score, everyone I hear is always talking about rewards….if you spend over a certain amount of your limit it will lower your score, doesn’t matter if you pay on time in full. With a debit card I’ve never had a problem with getting back my money that was fraud, with a credit card I have.
Love it! I’d love to see a video more in depth of using different credit cards to pay expenses (while paying it off in full) instead of a debit card to maximize their perks. Thanks 🙏🏽
Use credit card. I knew two people who had their bank accounts emptied via a debit card. They got their money back but it took a sevveral of weeks, which led them to missing a house payment and other bills and borrowing money from me just for food.
CC is my preferred method of payment also my default. I’ve been doing so since I was 18 in college and got my first credit card. I have always paid off my account balance at the end of each billing cycle, no fees at all. I now have maybe six credit cards, but only actively use three for different things. One is for my main purchases and the others are for stuff I need on the side. I have all of them on auto payments coming from my checking, so the only thing I really need to manage is to have enough money in my checking to pay for everything. And the rewards that come with each card is just icing on the cake.
I listen to Dave Ramsay mostly. I disagree fully with his stance on credit cards. I hate when he uses the “not one millionaire I interviewed said they did it with credit card points”. We all know that, we don’t use them to become rich on points but they are nice little discounts on a spend that we were going to make anyway. If I can choose to buy something at full price with my debit or get 5% back on a credit card, I am choosing the 5% discount every time. I have zero debt and an amazing credit score because I know how to budget and use my credit to my advantage. I create monthly budgets and I only spend what I budget on credit and pay it in full every month.
This is great information. I'd like to fully transition to using my CCs for all of my spending, but I've often dreaded the feeling of not having some cash on hand or available for usage. I like the idea, but there's an entire mind-shift that comes with this
The average annual salary in the US is 80k. If you don’t make twice that I don’t recommend using credit cards. To own a home you must make 120k to afford the average home mortgage payment. Most people do not have the disposable income to utilize the points on credit cards effectively. It’s not a control issue it’s a predation issue.
I just moved back to using debit. I found myself overspending when using credit card. Not to the point of creating new debt, but just as you said, you have no emotional connection to the swipe. I want to retain more cash. This will force me to be more disciplined and get back some control. :)
I think Ramsey means well, but often his advice is just replacing ignorance with superstition. I think people do end up better off with the superstition instead of the ignorance, but it’s not factual advice
As a foreigner living in Japan, getting a CC here is ridiculously hard. Luckily, Japanese debit cards give points, which can be converted into yen. Also, there are no minimum balances required in Japanese bank accounts.
I started my credit journey at 17. Paid thousands in interest due to reckless spending in my early 20s but at least I learned. I'm 31 now with a mortgage and an 820 fico. It's all about discipline!
I don't use my debit card because of skimmers. If someone hacks your account they are taking your cash and can be a real pain and you'll be cashless. Credit cards, you have time for the credit card company to fix the problem.
I never use a debit card, unless that's my only option. I ALWAYS use credit cards because of the points. BUT that is only because I always pay off my balance every month. If you don't have that discipline, then you should only use a debit card. I started with Dave's advice, but I think he's wrong when you have a lot of money and you can pay it off.
I totally agree with you. Use credit card wisely. Don't be its slave. With well planed purchase and discipline to pay off credit card, you can manage your finance and monthly payment. I prefer to pay grocery purchase and other bills via credit card. This way I know how to plan my next month money spending while I feel safe to have some cash in my account for a current month. Plus some credit cards offer cash back which is a reward you gain back after spending like you pay $300 for grocery then you get $6 back like getting a discount. These are things that debit card will never have.
I used to charge everything on my elite CC to keep track of my spending via the monthly statements, and for the travel perks & cash back, etc. Now, I still have that CC, but I am back to using cash for everything. Your video about the Chinese using cash reminded me of my Chinese granny and the old world ways & wisdom about money.
Amazing video, but I think you forgot that most credit card companies charge a small fee to retailers for transactions. That's part of the reason Amex is sometimes not accepted: they have a higher fee than most.
I use credit cards at every opportunity to charge. I receive 2% cash back as incentive. My typical charges total $3000 a month or $36,000 annually. This provides around $700 cash back a year. It pays my cable bill in concept. I pay off total twice a month. That keeps me debt free. FYI, fico is 846. Ramsey is right but I have the disciple to live well below my means. Not all do,
At one point, I did use debit cards but eventually I started using a credit card on larger purchases such as college tuition and paying them off before interest occurred. Now I only use credit cards all eligible purchases. Unfortunately payment such as mortgage local natural gas company bills are not able to be paid on the credit card unless you pay service fee Which is usually about 2% therefore I don’t make payments through my credit card on those bills.
The only time I use my debit card is to get cash out of the ATM. Our bank actually cancelled my wife's debit card because she didn't use it for years 😆
Credit Card for most purchases, Debit card for pulling cash from the ATM, and cash for local businesses that benefit from not getting hit by large transaction fees. As one major example, my barber charges 30% less when I pay with cash instead of a debit or credit card.
Debit cards are not entirely useless, I wouldn't say that. They have their purpose. Sure, they usually don't reward you with points from your institution, but many cash-back apps do accept debit card transactions for point accumulation. Furthermore, just having a debit card payment gives you peace of mind of having something paid off immediately as opposed to accruing it on a credit line. You get it over with! Lastly, many money orders will waive fees if you use a debit card, and at times merchant fees/surcharges aren't charged to debit cards.
I almost only use credit cards. Always pay the balance in time and never pay interests. Have been doing this for 6 years now, and it pays vacation( for my family every year(with the points I earn on my cards). This year we flew business from Europe to Mexico. Normally I would have to pay upwards of $10.000 for these tickets, but thanks to my credit card spending, it only cost me taxes and fees to the airline company. Saved approximately $9000. So if you have the discipline, use credit cards. Use them smart and enjoy the perks they give you :)
I racked up $12,000 in credit card debt in my 20s, paid it off in my early 30s, and these days I still use credit cards for everything and they are set to autopay statement balance each month. Just gotta learn the lesson the hard way sometimes.
I love your videos! I use a credit card and pay the balance off every month. 35 years ago I did not know how they worked and got into credit card debt. It has been over 25 years since I have ever carried a balance. I have a spreadsheet that I use to track my balances and determine the due date. I pay partial payments in lump sum every two weeks so I don't dread the official payment due date. While Dave Ramsey has good intentions on not using credit cards I think his followers actually pay more for insurance. I live in Southern California and things are so pricey here that I want rewards when I can get them. I do not own a debit card. I still have a ATM card to use when I need to take some cash out. It should be noted that more businesses are choosing plastic over cash because cash must be kept in a safe place and deposited into a bank (labor).
Hi Humphrey. So where do you keep the bulk of your liquid cash if you don't have a traditional debit card checking account? Is the bulk in HYSA, or a brokerage's cash management account - treated as a checking account? The thing is, there are more caveats with using interest-accruing accounts as checking account?
I am a person who really likes my debit card. I know some people might need a credit card, but the debit card works best for me. A lot less work involved. I so love simplicity.
Stores are beginning to charge “convenience fees” for using credit cards. If that becomes mainstream, that will be the end of non- business credit cards.
Three major bank credit cards in my country just moved from a 28 day credit cycle to a 21 day credit cycle. Rumour is they would like it to go to 14 day. This negates my use for a credit card. Although I am not there preferred demographic. They like “deadbeats”. That’s what the industry calls those who pay their card off each month.
My wife and I only use credit cards, and she has set our cards to use as to which category will give us back the most cash back rewards. We do not use any credit cards that charge an annual fee. We also pay-off any balance that we incur, regardless of the amount when it is due and sometimes before it is due. We do not make any minimum payments thus no finance charges or late fees. Therefore, we consider ourselves a credit card’s worst nightmare. I’ve also noticed that when I’m in line to pay for a purchase that some people who use their debit cards don’t ask or wait for a receipt. I wonder how they keep their books in proper order. I also wonder how many of debit card users have either poor or no credit.
Good vid. You didn't talk about cash though; I thought you were going to. I use cash about everywhere I shop locally. The primary reason is that it is not traceable. Yeah 'they' have ways of knowing where I went but they have no clue what I bought On the downside, to be fair, if someone robs you or steals your wallet that money is gone. One HUGE disadvantage of debit cards is if the bad guys get into your account and steal your money there is no getting it back. Banks will not reimburse you like a credit card would do if the same thing happened. Credit cards are much safer overall. They do have one significant flaw, which is the same with a debit card. Both are electronic payments. Which means that most cc companies can and will watch what you buy and sell that information to retailers.
In Germany the banks are trying to push credit cards, but the businesses usually don't want to accept them, because the VISA and Mastercard usually charge up to 2% of the revenue. For a discounter crocery shop like ALDI this would be their whole margin. They only accept the national debit cards, which charge only 0.15% or cash. Many people prefer discount shops like ALDI even though they don't offer any cashback etc., but its cheap anyway and so you don't have to deal with any additional cards and codes and all that annoying stuff. The large super markets will offer cashback options and bonuses but their product range is more expensive in the first place and I can't be bothered to deal with such unnecessary paper work. But Germany is a different market. Even Walmart could not compete there and was retreating with heavy losses.
I use credit cards primarily; I use one for the whole month, pay it off, then use a different one the next month. I let the cash back build up, then I use it to get gas cards. Also, if my bank account only has $10, that’s what my credit limit is, no matter what. I do use a debit, but only to pay my rent because they charge a fee for credit, and to Zelle one of my friends or family members.
I look at credit cards as a short term emergency loan. While buying a house last year I had to spend $12000 on accommodation, but I couldn't use cash as I needed it for the house. So I charged it all on cards and spread the payments over 3 months. Yes I paid some interest but I got my house 😊
We have used cash for the last 20 years and also we stick to a weekly budget. it saves us a fortune. Why , because it means something when you pay in cash. And the budget stops you over spending. If we have any left over at the end of the week we save it for treats, like weekends away.
I cut up my credit card after I built a credit rating back in my twenties. It was difficult for a while to transition to a debit card, however it's the best financial decision I ever made. I'll never have a credit card again. - Unlike this guy, I own my house, and don't rent. To me this whole credit card merry go round is like watching a dog chasing it's tail. - I worked for an airline, so I'm not looking for any frequent flyer or credit card points. It's a mug's game.
Money is a tool in a form of cash or debit or credit cards....the problem it's not the tool itself but US.....we get in trouble for not knowing how to use each one of these tools correctly.
The first thing I did when Chase issued me a debit card was lock it then leave it at home (I never bring it with me). I use CC card on all my purchases and utility bills. I pay off my CC weekly.
Thanks for the video I use credit card, and I don't carry a balance just like you I am curious if your opinion on credit plans where you pay a flat fee instead of interest each month, on whether or not it's cheaper than paying the interest and benefits and drawbacks
This only typically applies in North America and the UK. Credit cards have no rewards in most other countries of the world. Many countries also impose legal restrictions on who is entitled to receive credit.
Unfortunately majority of credit card owners don’t pay off the balance! Then the nightmare begins, high interest rates will keep them poor and the credit card companies rich.
@@Not_Ciel But what about the guide of keeping it above 0% but under 30% or even more ideally 10%? If you're paying everything by card wouldn't you easily utilize more than 30% of the limit?
![[Part 1] ทารกน้อยถูกทิ้ง👶 หญิงชราเก็บขวดขายเลี้ยงดูเขาจนโต #โลกการละคร](http://i.ytimg.com/vi/nPTDvFCExks/mqdefault.jpg)
What do you guys use? Let me know in the comments...
I got robbed 3k off my debit card for concert tickets being extremely careful with it. It was a whole ordeal, missing scheduled payments while making transfers, and getting reimbursed luckily. Compare that to the no liability credit card, it can be reversed in minutes. I have the 2-5% rewards cards and never carry, but the 'free money' is not why I use it. It is purely to reduce my liability. I completely believe that credit cards will influence you to spend more and that you are one step away from disaster, the studies and stats on this are pretty clear.
Can you explain when interest starts accruing on a balance? For example, I pay off my balance every two weeks and I don't think I am paying any interest. I will also pay more than I owe so that I have a negative balance. Is this a good idea?
I only use credit cards. Unless there is a big purchase and they charge 3% credit card fee. I'll use case and ask for 3% for using cash lol
How many credit cards do you use at the same time? My issue with playing the rewards game is that you have to keep track of multiple cards.
I only use credit card, have had fraudulent charges and it just feels far less risky when it’s on credit card and easy to fix. I only use my debit card if I need to make some kind of deposit or something at the bank, just to make sure it’s always the right account… one time they deposited into the wrong account and luckily I caught it by looking at the receipt even though it was correct on the slip… never did it manually ever again.
Edit: I do 2% on all purchases… 2% off everything I purchase… with kids, this makes a huge difference.
It's simple:
If you're saver, only use credit cards.
If you're a spender, don't even apply for credit cards.
Great way of looking at it.
Credit cards transfer money from customers who don’t use them to customers who do. It’s one of the many ways in which life is far more expensive when poor.
-cash back rewards are paid for from the small cut of the transaction that is taken from the vendor with each credit card use
-this added cost to stores is passed on to ALL customers, not just to those who pay with credit cards
If you have a well funded emergency fund, you could still be a spender and have a credit card. Makes you a bit of a saver but doesn’t mean you’re maximizing savings for retirement, HSA, etc
Yes
If you know what are doing that can pay off their credit card every month or just super rich, use credit.
Poor people or no Self control, use debt card.
Credit cards are good if you know how to use them. But most people don’t😢
I'm one of them I'm afraid
No they know how to use them they just don’t know how to pay it back
Credit cards can destroy your life.
You're the best. I also charge all expenses I can, even taxes and. Pay them off every few days or weeks, and the balance befoe the due date. Love the rewards.
Sadly, this is very true.
You can use credit cards as long as you pay it off that month. Advantage is you get reward points and travel points. Disadvantage if you're a compulsive buyer you might max out your cards. I am debt free.
Yup, never buy something "for the points". Just use credit cards to buy things you normally would buy and you'll be good.
@@RyChOr2005 For me the cash back is a bonus and not the reason to buy, but I travel constantly for work. I've spent more time dealing with stolen debit card numbers than I have with credit cards themselves. There is extra security from the credit card itself.
It doesn't change the way I spend money, but for purchases I need to make anyway, a little cash back is better than none. I actually use the Apple Card and the one time it was compromised I found out that by the nature of it's design I did not need a physical card replacement to change my card number. It's now the only card I use while traveling and nearly every purchase I make as long as Mastercard is accepted. I do keep a Visa card for retailers that don't accept Mastercard.
I'm debt free too but nobody will give me credit because I don't own money to anyone and never have....
And make sure you have income in order to actually be able to pay off the card
@@Stylez-13you would be able to get a credit card no problem, its just that you will have to start off with a very small credit limit and will have to work your way to increasing it about every 6 months
Don't forget, online purchases. Can't use cash. Exposing your debit card to the Internet isn't safe.
I’ve used credit cards for 99% of my purchases since I was 20 or so.
Never paid interest, never out of my means. 810+ credit score.
All the cash back rewards. 😎
Nice
If you're not going to pay interest, what do you get out of 810 credit score? A star from your teacher?
@@the-space-wiz Not paying interest on the credit cards.
Doesn’t mean I don’t/won’t use my credit score for housing or cars.
@@rig85 Use cash. If you pay off a car loan, your credit score drops.
If feels good not paying interest on my credit card too(most of the time). In all my years of using cc's I believe i only paid about 300-400$ on interest. But I was foolishly close to my limit all the time so I could never really build my credit. Im a believer that If I dont have at least 50% of the purchase cost on hand(considering all bills are paid and money in long term savings) I cannot afford what I want.
Credit card are good if you treat them like debit cards. Pay it off every month and cashflow them every month.
I've been hacked 3 times, with the lastest having all my savings drained because I used a debit card at a gas station. Using a credit card, your money is not at risk for fraud.
Yep, fraud prevention. Until they get debit policies in line with the high risk in today's world then I will be spending their money.
They do visa policy aplies to debt cards and credit cards
@@johnconner8437 It took the bank 6 weeks to return my stolen money while I still had bills to pay. And I had to be proactive in disputing the faulty transactions, while with a credit card it's easier to dispute and they do most of the work.
This!
I go with that same rationale.
People often seem to forget that swiping a debit card is just as emotionally painless as swiping a credit card. The whole "credit cards make you spend more" argument applies to debit cards as well. People also seem to forget that if you stick to a budget, the way you pay for stuff doesn't really matter. So you might as well get 2% back on everything.
the people who dont need to see this video are people who got their finance under control so it dont matter which for of payment they use. the people that need to see this type of vids are the people that is part of teh $1.4 trillion CC debt.
Nah. If I have 3k in my account and my insurance payment is due, I am not going to get down to the danger zone but if I know I have 3 credit cards with 10k limits and I can if needed carry the balance then I will never not be able to pay bills that require debit. It's the feeling of the remaining access to funds.
@yia01 I have 10 credit cards n im not in debt 😌😌
Nahhh. If u have $100 in ur checking, going out to eat is much more painful on a debit card than on a credit card.
@@ToboeKey309wow congrats, lmfao
With debit cards, what worries me is that it's linked to your bank account and if it's stolen, it takes at least 2 weeks to get your money replaced from the bank.
It depends on the bank. This happened to me with a credit union once and the money was replaced that same day.
Or maybe not get reimbursed at all.
@@AmericanWearswhat credit union?
@@topboygamer3140Navy FCU, Fort Bragg CU though they changed the name it will always be Ft Bragg like the base
I understand your points, but I cannot be trusted with a credit card based on my past history. When things are good, I forget to pay things off; when things are not so good, I spend too much. I am the big dumb.
thats completely fine, they are not for everyone and theres nothing wrong with that just like any one given diet isn't perfect for everyone
You're selling yourself short and resigning yourself to being - in your words - "dumb." You're smarter and better than that.
Awareness is the path to enlightenment - made this up
At least you’re honest with yourself 👍
Not dumb if you recognize it and take steps to avoid situations that mess you up!
Fund an emergency fund before you get a credit card.
Credit card is emergency fund
@@eile4219That’s a very risky idea.
@@eile4219 Those are some dangerous words there LOL. You have a painful lesson ahead with that mindset.
It’s *so* easy to whip out that credit card in an emergency you’re not financially prepared for.
As a general rule, I agree with David in that most people should avoid credit cards. I’ve used them responsibly for years, however I have made some bad choices in the past by getting services now instead of waiting until I had the money. I’ve also had buyers remorse having used a credit card when I wouldn’t have made the purchase with cash at the time. Also, when I use the debit card I see that balance go down immediately and it causes me to be more conservative with my spending.
Dave Ramsey advice is for financially incompetent folks who are deep in debt. If you know you are financially responsible, then there’s nothing to worry about and a majority of Dave’s advice is pretty god awful.
This is where you're wrong. The advice that people who have credit cards spend more is true for everyone. This has been proven to be true. If you get an offer for 5% on a $2000 spend. You're going to find a way to meet that threshold and I can guarantee you more than 5% are going to be spent on items you could have done without.
@@ret4kind got proof to back up that statement? Because my American Express statements say otherwise…and again…if you spend more with a CC but still pay it off every month, why does it matter? I’ve racked up enough points on my card to travel to Japan and back home TWICE and I have never got a late fee or interest payment.
@@ret4kindabsolute rubbish……😂😂
@@PrimitiveAK "if you spend more with a CC but still pay it off every month, why does it matter?"
"if you spend more with a CC"
"spend more with a CC"
"spend more"
Yeah he also prioritizes paying tithing, withdrawing 8% annually on retirement, and constantly downplays financial struggles that young people face that his generation didn't. Bad advice and out of touch.
Ramsey isn't worth listening to unless you're a massively indebted middle aged+ religious person.
I don't have debit card. I called the bank to remove the debit function.
I only use credit cards and never keep any balance.
Smart! I do the same. I used to work at a bank.
Don't swipe! Instead, tap when possible, it's more secure these days.
US is so behind. I was shocked they still have a strip in their cards.
*Thank you😊 for this video, do you offer account management or have any recommendations?*
If you’re using a good manager, it’s easier to earn from the market
That's true. a lot of people today have been
having lots of disappointments in trading in light of helpless direction and awful consultants
I've been trying to trade but I keep making losses and it's frustrating
Her platform is user friendly, transparent and secure with no restrictions
I started working with Miss Walter after I got a loan from a friend and now after receiving profit, I paid my friend and put back my earnings over and over again. I must say she's a very transparent and an honest personality
One of the Ramsey points is that they believe the points are “scummy” since the reason they offer them is because someone isn’t able to pay their card and pays interest which allows you to get benefits.
I mean that same logic could apply to the high yield savings accounts they advertise. You only get the interest because someone else is paying a higher rate of interest on a loan.
Same logic with promotional periods for loans. No financial institution gives customers money or discounts out of their bottom line.
That's only half true. Credit card companies make money in more ways just interest on unpaid balances. Amex, for example, makes most of their revenue from interchange fees. And besides that most credit cards are issued in partnership with banks. Banks have many revenue steams, and high interest credit card debt is only one part of that. Even if they didn't make any money from people not paying their credit card balances, they'd be paying out points on credit cards. Sure, it'd probably be at lower percentages, but the points would still be there.
And he makes money off of desperate viewers. So f what he thinks.
It’s also scummy that companies don’t allow you to be fully vested in your 401k until you’ve worked for them for 4+ years, does that mean I should just not donate to my 401k and collect the 4% match of free money?
I use a single credit card for everything. Get 5% back on gas and restraunts, 3% on groceries, costco, utilities, and 1.5% on everything else. I get back roughly $2.5k each year.
In my own circle of friends, the ones who get into credit card debt have much more going on in their lives that just overspending. They have health issues, self-esteem issues, employment issues, family that sucks they dry, drinking problems, partying too much, not giving a crap problem, and definitely math and not knowing any better problem.
All self destructive behaviors that majority of Americans seem to have. Little ability to discipline themselves
All my friends who use credit cards are broke, living paycheck to paycheck and have debt up to their eyeballs. My other friends who use debit cards own homes, have investment nest eggs and are living their best lives. Not sure if correlated to owning a credit card but I’d rather be in the latter camp.
Where I live (the Netherlands) creditcards don't give any type of rewards. The only reason I have a creditcard is for when I'm traveling outside of Europe or if I want to buy something from foreign websites.
Its probably because you have legal laws on how much interest can be collected on credit cards or the culture means everyone is educated on the ways to debts, so no one is dumb enough to buy things they can't afford on revolving accounts with 20% interest rates.
The rewards are there to entice people to buy more and hopefully not pay them off to collect interest, which actually does work on many people.
@@rebeltheharem7028 we do have different rules and laws, also we do not have an american style credit score. Also a culture of not spending more money then you have, altough the younger generations are going for car loans and lease plans, i'm from the 70's we learned to save up before buying something, only a mortgage is acceptable as a debt
I am also Dutch and from the '70's. Indeed do not spend more then you earn and ask yourself the question: do I really need that (item). Most, if not all adults in our Netherlands have a debit card. Most do not even walk around with cash. Or they use their mobile phone. A credit card is good to pay the toll on the highways in Italy and France. Also in our country almost no shops accept them. Shops want to be paid by debit card because it is faster and they do not have to count the money at the end of the day ( costs time) and they can not be robbed because of having cash in the shop. Almost nobody accepts 200 or 500 € bills.
I'm from Barbados and we really only get points and rewards with the high end credit cards(gold,platinum and black cards)not everyone can afford to have those cards.with the normal credit cards,we don't even get any rewards.
@@abelfaber4457Bonus Fact: The Netherlands Banks will lend you more money than what your house is worth (great for the individual, but not so much for their economy) - TH-cam Economist “economics explained”
I usually look up your videos for updates! Our government has no idea how people are suffering these days. I feel for people with disabilities not getting the help they deserve. Thank you Mrs Emily L Romano, imagine investing $12,000 and received $305,500.
You're correct!! I make a lot of money without relying on the government. Investing in stocks and digital currencies is beneficial at this moment
Mrs Emily L Romano was my hope during the 'bear summer' last year. I did so many mistakes but also learned so much from it, and of course from Emily L Romano.
She must be really dedicated and well trusted for people to talk much good about
the first step to successful investing is figuring out your goals and risk tolerance either on your own or with the help of a financial professional but is very advisable you make use of a professional
I Started with $5,000 and Withdrew profits $89,000
I agree 100%.
Using credit card only.
I racked up about $18K in credit card debt. First thing I did was stop using credit cards, transferred it to a 0%, and went all cash with a debit card. Down to $2500 and once that’s done will have no consumer debt at all. Will once again have control of my full income to devote to e-fund and investing.
I had even more than that in CC debt. I just didn't pay them and saved myself a lot of money.
@@the-space-wiz How's that wrecked credit rating working out for you?
If fraudulent activity happens on your credit card, it's the bank's money that is in jeopardy. If fraudulent activity happens on your debit card then it's your own personal money at risk. Sure, issues could be resolved with your checking account but if the balance gets drawn down it may cause other bills to bounce in the meantime.
I used to have 12 credit cards. Now I am down to 8. I mostly use my main 2 credit cards for gas, restaurants and groceries. I get 3-4X points back in these purchases. I pay off these purchases weekly. I also use my debit card sometimes as needed. Both have different use cases. Thanks for all the great videos you put out!
I am very disciplined, pay my cc card off faithfully every month and benefit from the cash back and rewards on the CC. I have never used a debit card in my life and most likely never will. Paying no interest and having better protection by using the cc is better for me and my choice. I have never paid cc interest in my life. Larry, Central Valley, Ca.
I liked that you pointed out the payment methods, the pros and cons as well as which behaviors were best suited to each method. Great job!!!
1:42 I remember a 60 Minutes show with Moreley Shaffer where his credit card insider guest said guys who pay their balance every month are called "deadbeats" 😂😂😂.
The fact there are tons of people who don’t have credit cards, but are in debt with cars, homes, or other loans proves it doesn’t matter, a financially irresponsible person will always be financially irresponsible, with or without a credit card.
Nope. Using cash means I can only use up what I have in my bank account. With credit cards I can borrow up to my credit limit which is more than the average person has in his bank account
@@robocop581 You missed the point entirely.
A debit card can also be run as a credit card as long as it has a credit card company logo on it like VISA. debit cards will always be useful because you might misplace your money or get robbed if you carry cash only.
Something overlooked is the vendor fees, credit card companies make a significant part of their profit off of charging vendors processing fees! Great video Humphrey as always!
The only correct payment method is carrying around a million dollars cash in a metal briefcase with you everywhere you go, but I don't have that kind of money, nor do I own a cool briefcase, so I just use a credit card. I pay it off weekly.
I hope u are paying the full balance 🤣🤣 like I do and I pay the full balance a day before the closing date not due date the statement closing date I hope u kno the fuckin difference 😌😌
@@ToboeKey309 Yeah, I pay off the full balance.
Why pay it off weekly when the grace period is longer? Sounds unnecessary. Who wants to pay bills every week?
@@the-space-wiz Short version is that it keeps me aware of how much I'm spending. I've talked to people who pay it daily.
I use a Debit Card. I hate Credit Cards(CC); you pay twice, once when you make the purchase itself and then again when the CC statement arrives. The banks really want you to use CC making it easy to use while making large purchases with Debit Cards harder all so you can end up making interest payments. The bank likes to use fraud protection as an excuse but the fact is your Debit card offers nearly as much fraud protection as the Credit Card. Contrary to the comercials on TV, CC companies are not always that eager to refund you your money when you've been a victim of fraud.
Swiping a credit card is painful when you know how much bigger the outstanding balance becomes 😱
*Thank you😊 for this video, do you offer account management or have any recommendations?*
As a beginner investor, it's essential for you to have a guide. Myself I'm guided by Mrs Victoria K Walter, a widely known consultant
If you’re using a good manager, it’s easier to earn from the market
That's true. a lot of people today have been
having lots of disappointments in trading in light of helpless direction and awful consultants
I've been trying to trade but I keep making losses and it's frustrating
VICTORIA K WALTER is exceptionally good, i believe you should give her a try
Credit cards are incredibly useful because they pay you reward for spending money on it so as long as you know how to use it. Travel cards are a flex for myself personally.
Fraud on a debit card can wipe out your checking or savings account while they investigate for WEEKS. With a credit card it’s on them.
Debit card is also good for the times when some services charge fees if you use a credit card and not a debit also to use withdraw cash at the bank or ATM (excluding using your phone app) and also some debits have rewards programs. Overall though a credit card is preferred.
I think the real issue at hand is, people view finance as a one size fits all situation. Whether a credit card is right or a debit card, it’s up to the individual to make the best decision for themselves.
One of the overlooked factors. Refunds and fraud. When you dispute a debit card charge - you begging the bank or business to give you back your money.
With credit - you refusing to pay.
I know it’s subtle. But there’s a huge difference. Banks are not incentivized to return your money.
Credit Cards cost the merchants more. If you think they won't pass on the costs to you, you are naive.
calling an inanimate object 'evil' is like blaming a pen for misspelled words
Well said.
It's just shorthand. Don't be obtuse
@@TheThreatenedSwan I disagree that it’s shorthand. It’s misdirected. It treats the symptom instead of the root of the issue. It blames the object instead of the actions taken by the individual. Would be more beneficial to fix the flawed psychology, then to limit one’s options.
The idea behind it is greed. Look up some old documentaries on credit cards and how it started and why. Banks consider people who use their credit card wisely deadbeats (actual term) and don’t like them. They prefer people who overspend and pay interests as that is what makes them billions. All the benefits are meant to lure people into the trap and sadly most people fall into and can’t get out easily.
It's like US politicians with their phrase "gun violence".
Debit for the day to day, credit card for routine bills
I do the same thing, but sometimes I find myself using a debit card that way I don’t over utilize my credit card. Thoughts?
Always enjoy your videos. I have learned so much from your videos over the past three years! Much love from Shanghai China!
Yup debit cards are evil, I exclusively use credit cards
haha
Why are they evil?
@@GlitterSn1ffer it’s just impossible not to have late fees etc, replace with credit card, same convenience, but you keep your money till the end of the month and pay in one bulk payment, when you use debit card say pay for gas, they place a hold for $100 then charge you say for $50 so really $150 hold for $50 of gas until the hold falls off, then you end up being in the red, subject to late fees, Also if there are any fraud charges they come direct out of your account with debit card so money is essentially gone,with credit they aren’t paid so you have more time to contest and stop payment,
I really like that he hit on the credit score, everyone I hear is always talking about rewards….if you spend over a certain amount of your limit it will lower your score, doesn’t matter if you pay on time in full. With a debit card I’ve never had a problem with getting back my money that was fraud, with a credit card I have.
Love it! I’d love to see a video more in depth of using different credit cards to pay expenses (while paying it off in full) instead of a debit card to maximize their perks. Thanks 🙏🏽
Kudos humphrey! Have a good day
Use credit card. I knew two people who had their bank accounts emptied via a debit card. They got their money back but it took a sevveral of weeks, which led them to missing a house payment and other bills and borrowing money from me just for food.
CC is my preferred method of payment also my default. I’ve been doing so since I was 18 in college and got my first credit card. I have always paid off my account balance at the end of each billing cycle, no fees at all. I now have maybe six credit cards, but only actively use three for different things. One is for my main purchases and the others are for stuff I need on the side. I have all of them on auto payments coming from my checking, so the only thing I really need to manage is to have enough money in my checking to pay for everything. And the rewards that come with each card is just icing on the cake.
I listen to Dave Ramsay mostly. I disagree fully with his stance on credit cards. I hate when he uses the “not one millionaire I interviewed said they did it with credit card points”. We all know that, we don’t use them to become rich on points but they are nice little discounts on a spend that we were going to make anyway. If I can choose to buy something at full price with my debit or get 5% back on a credit card, I am choosing the 5% discount every time. I have zero debt and an amazing credit score because I know how to budget and use my credit to my advantage. I create monthly budgets and I only spend what I budget on credit and pay it in full every month.
This is great information. I'd like to fully transition to using my CCs for all of my spending, but I've often dreaded the feeling of not having some cash on hand or available for usage. I like the idea, but there's an entire mind-shift that comes with this
The average annual salary in the US is 80k. If you don’t make twice that I don’t recommend using credit cards. To own a home you must make 120k to afford the average home mortgage payment. Most people do not have the disposable income to utilize the points on credit cards effectively. It’s not a control issue it’s a predation issue.
I just moved back to using debit. I found myself overspending when using credit card. Not to the point of creating new debt, but just as you said, you have no emotional connection to the swipe.
I want to retain more cash.
This will force me to be more disciplined and get back some control. :)
I think Ramsey means well, but often his advice is just replacing ignorance with superstition. I think people do end up better off with the superstition instead of the ignorance, but it’s not factual advice
As a foreigner living in Japan, getting a CC here is ridiculously hard. Luckily, Japanese debit cards give points, which can be converted into yen. Also, there are no minimum balances required in Japanese bank accounts.
I started my credit journey at 17. Paid thousands in interest due to reckless spending in my early 20s but at least I learned. I'm 31 now with a mortgage and an 820 fico. It's all about discipline!
I watch your videos on a daily basis. You definitely changed my views on finances. Thank you sir! :D
I don't use my debit card because of skimmers. If someone hacks your account they are taking your cash and can be a real pain and you'll be cashless. Credit cards, you have time for the credit card company to fix the problem.
And I’m an avid Dave fan along with following you and a few others. And the more you learned the more you know the better decisions you can make.
I never use a debit card, unless that's my only option. I ALWAYS use credit cards because of the points. BUT that is only because I always pay off my balance every month. If you don't have that discipline, then you should only use a debit card. I started with Dave's advice, but I think he's wrong when you have a lot of money and you can pay it off.
Should you use a credit card on purchases if there’s a service charge for using one instead of cash/debit?
I totally agree with you. Use credit card wisely. Don't be its slave. With well planed purchase and discipline to pay off credit card, you can manage your finance and monthly payment. I prefer to pay grocery purchase and other bills via credit card. This way I know how to plan my next month money spending while I feel safe to have some cash in my account for a current month. Plus some credit cards offer cash back which is a reward you gain back after spending like you pay $300 for grocery then you get $6 back like getting a discount. These are things that debit card will never have.
I used to charge everything on my elite CC to keep track of my spending via the monthly statements, and for the travel perks & cash back, etc. Now, I still have that CC, but I am back to using cash for everything. Your video about the Chinese using cash reminded me of my Chinese granny and the old world ways & wisdom about money.
Amazing video, but I think you forgot that most credit card companies charge a small fee to retailers for transactions. That's part of the reason Amex is sometimes not accepted: they have a higher fee than most.
I use credit cards at every opportunity to charge. I receive 2% cash back as incentive. My typical charges total $3000 a month or $36,000 annually. This provides around $700 cash back a year. It pays my cable bill in concept. I pay off total twice a month. That keeps me debt free. FYI, fico is 846. Ramsey is right but I have the disciple to live well below my means. Not all do,
I got a debit card when I was 14 and used it all the time, but now that I’m an adult I only use credit cards
At one point, I did use debit cards but eventually I started using a credit card on larger purchases such as college tuition and paying them off before interest occurred. Now I only use credit cards all eligible purchases. Unfortunately payment such as mortgage local natural gas company bills are not able to be paid on the credit card unless you pay service fee Which is usually about 2% therefore I don’t make payments through my credit card on those bills.
I use credit cards for most of my purchases but as you mentioned in the video, I pay them off every two weeks or every month.
I'm with Dave Ramsay on this. Credit cards and the entire interest system are destructive to more people than debit cards are.
The only time I use my debit card is to get cash out of the ATM. Our bank actually cancelled my wife's debit card because she didn't use it for years 😆
Credit Card for most purchases, Debit card for pulling cash from the ATM, and cash for local businesses that benefit from not getting hit by large transaction fees.
As one major example, my barber charges 30% less when I pay with cash instead of a debit or credit card.
Sleezy for that barber to essentially charge 30% more to people with a credit card, instead of 3%
@@soapa4279 It's called "under the table."
That 30% goes to taxes on documented transactions.
Debit cards are not entirely useless, I wouldn't say that. They have their purpose. Sure, they usually don't reward you with points from your institution, but many cash-back apps do accept debit card transactions for point accumulation. Furthermore, just having a debit card payment gives you peace of mind of having something paid off immediately as opposed to accruing it on a credit line. You get it over with! Lastly, many money orders will waive fees if you use a debit card, and at times merchant fees/surcharges aren't charged to debit cards.
I almost only use credit cards. Always pay the balance in time and never pay interests. Have been doing this for 6 years now, and it pays vacation( for my family every year(with the points I earn on my cards). This year we flew business from Europe to Mexico. Normally I would have to pay upwards of $10.000 for these tickets, but thanks to my credit card spending, it only cost me taxes and fees to the airline company. Saved approximately $9000.
So if you have the discipline, use credit cards. Use them smart and enjoy the perks they give you :)
Yeah there are some people who think it is free money. Not me, I feel the same pain as buying with cash!
I racked up $12,000 in credit card debt in my 20s, paid it off in my early 30s, and these days I still use credit cards for everything and they are set to autopay statement balance each month. Just gotta learn the lesson the hard way sometimes.
I love your videos! I use a credit card and pay the balance off every month. 35 years ago I did not know how they worked and got into credit card debt. It has been over 25 years since I have ever carried a balance. I have a spreadsheet that I use to track my balances and determine the due date. I pay partial payments in lump sum every two weeks so I don't dread the official payment due date. While Dave Ramsey has good intentions on not using credit cards I think his followers actually pay more for insurance. I live in Southern California and things are so pricey here that I want rewards when I can get them. I do not own a debit card. I still have a ATM card to use when I need to take some cash out. It should be noted that more businesses are choosing plastic over cash because cash must be kept in a safe place and deposited into a bank (labor).
Hi Humphrey. So where do you keep the bulk of your liquid cash if you don't have a traditional debit card checking account? Is the bulk in HYSA, or a brokerage's cash management account - treated as a checking account? The thing is, there are more caveats with using interest-accruing accounts as checking account?
I am a person who really likes my debit card. I know some people might need a credit card, but the debit card works best for me. A lot less work involved. I so love simplicity.
Stores are beginning to charge “convenience fees” for using credit cards. If that becomes mainstream, that will be the end of non- business credit cards.
Three major bank credit cards in my country just moved from a 28 day credit cycle to a 21 day credit cycle. Rumour is they would like it to go to 14 day. This negates my use for a credit card. Although I am not there preferred demographic. They like “deadbeats”. That’s what the industry calls those who pay their card off each month.
My wife and I only use credit cards, and she has set our cards to use as to which category will give us back the most cash back rewards. We do not use any credit cards that charge an annual fee. We also pay-off any balance that we incur, regardless of the amount when it is due and sometimes before it is due. We do not make any minimum payments thus no finance charges or late fees. Therefore, we consider ourselves a credit card’s worst nightmare.
I’ve also noticed that when I’m in line to pay for a purchase that some people who use their debit cards don’t ask or wait for a receipt. I wonder how they keep their books in proper order. I also wonder how many of debit card users have either poor or no credit.
Could we get a portfolio update Humphrey, it's been a hot minute since you have posted a portfolio update
Good vid. You didn't talk about cash though; I thought you were going to. I use cash about everywhere I shop locally. The primary reason is that it is not traceable. Yeah 'they' have ways of knowing where I went but they have no clue what I bought On the downside, to be fair, if someone robs you or steals your wallet that money is gone.
One HUGE disadvantage of debit cards is if the bad guys get into your account and steal your money there is no getting it back. Banks will not reimburse you like a credit card would do if the same thing happened.
Credit cards are much safer overall. They do have one significant flaw, which is the same with a debit card. Both are electronic payments. Which means that most cc companies can and will watch what you buy and sell that information to retailers.
In Germany the banks are trying to push credit cards, but the businesses usually don't want to accept them, because the VISA and Mastercard usually charge up to 2% of the revenue. For a discounter crocery shop like ALDI this would be their whole margin. They only accept the national debit cards, which charge only 0.15% or cash. Many people prefer discount shops like ALDI even though they don't offer any cashback etc., but its cheap anyway and so you don't have to deal with any additional cards and codes and all that annoying stuff. The large super markets will offer cashback options and bonuses but their product range is more expensive in the first place and I can't be bothered to deal with such unnecessary paper work.
But Germany is a different market. Even Walmart could not compete there and was retreating with heavy losses.
I use credit cards primarily; I use one for the whole month, pay it off, then use a different one the next month. I let the cash back build up, then I use it to get gas cards. Also, if my bank account only has $10, that’s what my credit limit is, no matter what. I do use a debit, but only to pay my rent because they charge a fee for credit, and to Zelle one of my friends or family members.
I still feel that if I focus on cashbacks too much, I will sometimes buy something that I actually wouldnts buy without cashback
I look at credit cards as a short term emergency loan. While buying a house last year I had to spend $12000 on accommodation, but I couldn't use cash as I needed it for the house. So I charged it all on cards and spread the payments over 3 months. Yes I paid some interest but I got my house 😊
We have used cash for the last 20 years and also we stick to a weekly budget. it saves us a fortune. Why , because it means something when you pay in cash. And the budget stops you over spending. If we have any left over at the end of the week we save it for treats, like weekends away.
I cut up my credit card after I built a credit rating back in my twenties. It was difficult for a while to transition to a debit card, however it's the best financial decision I ever made. I'll never have a credit card again. - Unlike this guy, I own my house, and don't rent. To me this whole credit card merry go round is like watching a dog chasing it's tail. - I worked for an airline, so I'm not looking for any frequent flyer or credit card points. It's a mug's game.
Money is a tool in a form of cash or debit or credit cards....the problem it's not the tool itself but US.....we get in trouble for not knowing how to use each one of these tools correctly.
The first thing I did when Chase issued me a debit card was lock it then leave it at home (I never bring it with me). I use CC card on all my purchases and utility bills. I pay off my CC weekly.
Thanks for the video I use credit card, and I don't carry a balance just like you I am curious if your opinion on credit plans where you pay a flat fee instead of interest each month, on whether or not it's cheaper than paying the interest and benefits and drawbacks
This only typically applies in North America and the UK. Credit cards have no rewards in most other countries of the world. Many countries also impose legal restrictions on who is entitled to receive credit.
Unfortunately majority of credit card owners don’t pay off the balance! Then the nightmare begins, high interest rates will keep them poor and the credit card companies rich.
Great content as usual! What about credit utilization when paying with only credit cards?
Your credit card utilization should always be 0% if you’re paying it off every month…
@@Not_Ciel But what about the guide of keeping it above 0% but under 30% or even more ideally 10%? If you're paying everything by card wouldn't you easily utilize more than 30% of the limit?
Really good video!