Debt

You can claim your money back through your card if the ompany goes bust or you are defraauded.

I did that several decades ago when I bought items online that were never delivered aand I could not get my money back from the supplier either.

keepingquiet

So people buy with a credit card because their purchases are guaranteed?

Forgive me being dim- but how does that work?

Last time I used my cc was in M&S at Christmas because I realised at the till that I didn't have my debit card. It was a food puchase.

So if I found the food wasn't satifactory I could have got my money back?

Surely however I paid for it I have statutary rights that says I can return unsatifactory goods- why does the credit back make that better?

I don't use a credit card for food but I do for other purchases.

If you have a problem with an item, a supplier or are scammed in any way, you can access more help if you have used a credit card.

I'm still not getting it.
I took out my first credit card to pay for flights because my debit card wasn't accepted- that was about 30 years ago.
I then used a lot of 0% card transfers to pay it off, which took several years because it made sense to me as I was paying no interest.
I have since used credit cards to pay for purchases abroad because it is cheaper than withdrawing money from my bank account when overseas.
I have never made big purchases by card for furniture, cars or other products, household improvements etc because I paid for them out of my bank.
For years I had no debt, and only recently took out a credit card for another overseas holiday, my first in seven years.
Now I am paying off that card at 0% interest. I don't intend to use it again.
I don't think I need any financial advice.
I suppose we all manage our finances differently but paying for things on credit when you can pay for them yourself still makes little sense to me.
I suppose I'm just a bit odd.

I suppose we all manage our finances differently but paying for things on credit when you can pay for them yourself still makes little sense to me.

It makes perfect sense, especially when interest rates were high, because borrowing money at 0%, if you could, meant you could leave your savings where they could gain interest.

Only if it was at 0% or you paid off the balance monthly and promptly.

M&S credit card and some other cards give you rewards for using their card so there is a financial incentive, albeit small these days, to use your card. Also since Covid when most places would only accept card payments and not cash, and so many banks have closed so you can’t get your hands on cash anyway, it’s just as easy to use a contactless cards. It’s easy however to run up debt if you don’t keep a strict eye.

It’s common sense to use a credit card for purchases and pay it off in full each month.
Why wouldn’t you want the protection it gives you?

We use a JL credit card for everything, earning £200-£300 in their vouchers every year. Free money!

I have had to go the other way around. My way was to save and pay for items as I went along. If I couldnt afford it I went without, or bought second hand etc etc. However a few years ago, when I was looking at changing my car, found that I didnt have a credit history, and instead of that looking good, that it actually went against me as they had nothing to compare.

I then started to use a credit card for a few things, but with it arranged to pay off in full each month, so that there was no interest to pay. As far as I am concerned , it still remains the same as I used to do, I dont take on any debt I cant afford, but now I just make sure that I have enough in the current account to pay the credit card. As others have said it is safer anyway for higher level spending, and I now have a bank account that actually gives me something for things I have on DD etc., so that it actually covers the cost of the account too.

I still think in terms of what I can afford, and saving for it, but for me the credit card is more for any unexpected problems such as the washer going wrong or a problem with the car. That gives me a sort of safety net feeling, but thank goodness , have never needed to use it. Have very little pension etc., and it is important to me to keep myself out of debt, but with the cost of everything going higher, it is a constant worry, especially as I do not have a lot of luxury that I could give up. No one knows how life will go and sudden illness or loss of a job can plunge people into debt, but it can be difficult to save up any money even for emergencies, if everyday costs rise and you do not feel secure in your job.

There are so many things that have to be put into a school timetable, but I do think that perhaps in the maths area, some time spent explaining such things as debt, the difference between direct debit and the cost of credit and how to control it would be worth while. Even simple maths of children comparing the actual cost of buying for cash, saving a certain amount of money a month, comparing how the price might rise over the saving time, but comparing it to the overall cost if you buy on credit ,would be worthwhile.

When I was teaching junior children I used to do a couple of things with them to show them roughly how this worked. So they would have pieces of lego of different colours, representing money. Then we would have an item that they wanted to buy, and they had to choose how they would buy it, straight away or over time etc. In the beginning of course they mostly wanted to get it straight away, but didnt have enough lego for it. Then we worked out how to pay so much per month etc. We did this with several toys and I gave out more lego , and so we saw at the end of the time, that those who had paid monthly still owed lego and did not actually own the prize, but the one or two who had saved actually owned the prize. I removed the prize from those who had paid in bits and they were quite shocked to see that I could take the prize back when they had paid for some of it. It was quite a good way to show them how it worked, in a way they could understand. Some of course were still baffled by the whole thing but I felt sure that the lesson was learnt by others. If we can explain in simple terms that children understand then it is up to them , of course, what they do with the information.

Madeleine45 - you were absolutely correct to give them lessons like this and put in a way they could understand.

Looking back all those years to my schooldays - and the lessons that stick out in my mind were the ones where they were teaching us practical "life management" type things (like contraceptive lessons/a film on giving birth/debating society and mock elections/analysing adverts). So certainly money management is one of the most fundamental things imo.

I would say the most useful course I did myself was economics O level and that certainly taught some basic lessons about finances and has proven useful to me practically since. I still remember the basic gist of the "laws" of supply and demand - all that "How much are you prepared to pay for that second punnet of strawberries?" stuff - answer = "Rather a lot less - as you've already satisfied your basic craving for strawberries".

The National Curriculum for teenagers is already very crowded. I agree that some simple economics would be useful, but I think that the teaching of fiscal responsibilities is the duty of parents. Any child will have absorbed how their family manages the incomes/ outgoings from an early age, anyway.

We pay the balance off in full every month. The credit card gives you better protection if anything goes wrong PLUS we get cashback on all purchases. Win/Win

Back in 1968 my Husband left me with a debt of £10 for some books he bought, I remember it as if yesterday and the shame I felt. Never been in debt since and I can't imagine some of the tales here. Debt was a number one shame back then.

Why have a credit card if you pay it all off every month? Air miles!

Luckygirl3

*If you can pay it all off on the due date why do you need a credit card?*

I too do this because it provides better safeguards in relation to refunds if you are the victim of fraud.

I do the same. I have 5 credit cards that I use regularly and another couple that are rarely used. The ones that are used make me money, because each one is paid off monthly by direct debit and I get cashback and special rewards for using them.

Paperbackwriter

Why have a credit card if you pay it all off every month? Air miles!

Air miles, free flights!

sf101

I only use my credit card for online shopping, much better protection, and set up to pay the balance every month.

Yes, this really is the sensible way to shop. I very rarely use my debit card at all now, and do most of my grocery shopping online too. My credit card statement gives me an exact list of all my monthly spending. I do occasionally do bank transfers to pay for things, but only when I know the payee well enough to trust them.

I haven’t had a CC in years due to ex hubby overspending - and how!!! He had been sent about 12 CCs. He eventually sorted it out and like me will not entertain one now. It was the fault of the banks and financial companies who gave them to him to pay the off all the previous debts, and so it went on.
No one NEEDS one.

Credit cards offer extra protection and mine also does cashback on some categories of purchases, I always pay it off before it's due.

I pay off my credit card every month and get cash back which paid for 2 theatre tickets this time round. However, if I cannot afford something I don’t buy it. Credit cards give peace of mind on items over £100 but on debit cards you can use charge back if necessary.
When I was teaching PSHCE financial management was included in the syllabus and I remember students being astonished that their parents had to pay for water!
I have been skint, not broke, and recall the mortgage rate soaring to 17% just as I bought out my ex. I had a child to support, bills etc so I had a lodger which worked well for many years until I earned enough to be self sufficient. It was a scary time but we survived

There is a lady on FB called the complaint cow, she is brilliant with complaints, helps for free (so long as you say please and thank you). She's written books about

JennyCee

I haven’t had a CC in years due to ex hubby overspending - and how!!! He had been sent about 12 CCs. He eventually sorted it out and like me will not entertain one now. It was the fault of the banks and financial companies who gave them to him to pay the off all the previous debts, and so it went on.
No one NEEDS one.

But you do NEED a credit card, in order to get a credit record should you want a mortgage or a car loan.

I quite agree that for some people they are best never owned, but a good 90% of us, I should think, have had credit cards for years without them ever being a temptation to overspend.

Hard cases make bad law and bad rules for how other people can live. I have had a credit card since they were first issued. My first credit limit was £36. I have never in over 60 years, reached my credit limit or been unable to make a monthly payment, and that applies to most people.

Young people are pushed into a consumer society. New homes are expensive, but they come with fitted carpets, curtains, white goods, ready made gardens. Cars come with 0% finance. I could afford none of these when we got married. So they start with a bigger debt and it becomes the norm to want something and have it now and not save or live within your means.

There is, of course, the lack of help to obtain benefits, discounts, low rates for those in need. My generation had a "claimants union" that pointed people to their entitlements and help, liaised with creditors, ran an emergency food and clothing bank and helped with temporary homing - but then we had decent social housing and were not expected to buy and in most areas, decent public transport.
We also had, until recently, firms with a conscience that retained and retrained its staff, instead of the US attitude of treating them as disposable "resource"

Why on earth were the credit cards in your name only and not joint names,,

M0nica

JennyCee

I haven’t had a CC in years due to ex hubby overspending - and how!!! He had been sent about 12 CCs. He eventually sorted it out and like me will not entertain one now. It was the fault of the banks and financial companies who gave them to him to pay the off all the previous debts, and so it went on.
No one NEEDS one.

But you do NEED a credit card, in order to get a credit record should you want a mortgage or a car loan.

I quite agree that for some people they are best never owned, but a good 90% of us, I should think, have had credit cards for years without them ever being a temptation to overspend.

Hard cases make bad law and bad rules for how other people can live. I have had a credit card since they were first issued. My first credit limit was £36. I have never in over 60 years, reached my credit limit or been unable to make a monthly payment, and that applies to most people.

You also need a Credit Card to hire a car and they are much better for online purchases because if a transaction goes wrong you can ask for a refund - chargeback from the card company.
Like others, mine pays back every month automatically.

Using a card also gives you a credit history, defo needed in these modern times if you ever wish to buy , say, a house

We use a John Lewis credit card for just about everything and pay it off monthly. The benefits are the protection, plus the accumulation of JohnLewis vouchers over the year which always come in handy at Christmas.