10 Common Mistakes In Holding Credit Cards

[Gootsy]

I make 48 bucks a year just having my credit card sitting in my wallet gathering dust through monthly bank account refunds.

And of course the points I get using it is nice, but so minor since I almost always forget to use it . Infact, this year I'd guess that outside of the christmas payment I made in January, I haven't put/spent more than 100 bucks on my CC.

[rolltimer]

I'm in the "credit cards are tools to be used appropriately" crowd. My parents never used much credit so I never saw the "get it now, pay for it later" mentality in action. It was very hard for me to get credit when I got out of college. Sure I got a couple of department store cards but since I never shopped at those expensive (for me) places, I didn't build a credit reputation. I wanted cards I could use--gas charge cards, check-cashing cards--but I was turned down for having no credit. Finally, I got a Sears card, used it a few times. Later, I signed up for Discover and learned the value of cash back and how I could earn by using my card for what I would be buying anyway--gas, groceries, utilities--only use the other card if Discover is not accepted. Debit cards are what I stay away from. Convenient? Oh, yeah but that money is whisked out of your account about as fast as you can walk out of the store.

[72Tiger]

I'm going to go out on a limb, and say that I think they are evil.

[ThePennyMine]

I use credit cards all the time. My cashback card gives me 1% back on all of my purchases, which is better than nothing, especially when I put all of my daily expenses on it. I've written an article about it here.

[cigood]

I love using my credit card. But I agree that if not used properly they can be destructive. I pay my card off every month and love getting the points they give.

[fluffysamantha]

yeah..so if you think you can't manage it..then don't use it.. but if you think you can, then have fun using it...

[VaranusK]

It's good to be aware, so this post should be spread a lot more. I think that (un)fortunately most of the ones here have learnt one way or the other the risks of the credit cards.
I just got one recently because it was free, never had one before. And I plan to use it only to delay a payment I could do cash, and then save the amount on a special account earning some interest (as pointed out here also), or in case the limit of my debit card is not enough, but always having already the funds for the payment!

[rodaniel]

On point #6 ("Not checking your credit card statement") I'd add that it is well worth the effort involved to save every credit card receipt in a little pouch or envelope and then check those against your statement when it arrives. We have caught a few - tho not many - errors this way over the years.

Then once you've verified everything and submitted your payment, shred the statement and receipts.

Like many others here, my wife & I use our Mastercard account quite heavily to squeeze every last nickel out of the cash-back dividends plan. Also like others here, we never, ever carry a balance from one month over to the next. After nearly 12 years, we feel like old pros, but we sure didn't get there overnight...

[Jenny's Dad]

Credit cards with cash back or miles are a good idea if one pays off each statement in full immediately and if one can get the annual fee waved.

[MasterYourCard]

Credit cards aren't inherently evil. As others have mentioned in this thread, they are nothing more and nothing less than a powerful financial tool that can be used or abused.

I feel there's a right way and a wrong way to use credit cards.

The right way: Paying off your balance on time and in full every month.

The wrong way: Everything else

For those who can realistically commit to using a card the right way, why not use a credit card? A cash rebate card is basically free money, so long as you use it responsibly.

By the way, this is a bit of a shameless plug, but I just wrote a review on the Amex Blue Cash credit card that you can check out here. As far as I can tell, it's the most generous cash rebate card currently available - as long as you spend over $6500 per year on it you get a guaranteed 5% cash rebate on most purchases (including gas stations).

If anyone has some other recommendations I'd be really interested in hearing them.