Non-Debt Credit Card

[Burke]

For convenience, a credit card is almost mandatory for me. Being able to pump gas and not go into the service station to settle up for instance, espescially in an unfamiliar area when travelling; ordering anything online; booking hotels which usually require a cc for guarantee, etc. I currently have nearly 100K miles on my account I can use for free flights when I can get them, or (most often) for upgrades to first class. And for travelling overseas, it gives peace of mind knowing you can pay with convenience and settle any problems when you get back home. For that purpose, I recommend one which does not charge currency exchange fees.

[JohnH]

Burke just reminded me of another set of benefits - small but sometimes useful. If you carry an airline's card, sometimes you get early boarding, shorter check-in lines, or special deals on excess baggage fees. They sometimes set the mileage award levels a little lower for their affinity card holders. Also, using the card to pay for rentals at affiliated car rental places gets you extra frequent flyer miles as well. My card even ofers mileage bonuses for trying specified restaurants.

As Burke pointed out, you almost always pay an annual fee for an affinity card, so you have to decide if the benefits are worth the annual cost before you leap in. The US Airways card currently charges $89/year. I'm not crazy about the airline, but given where I live I have no choice but to patronize them.

[Burke]

Personally, I don't have a credit card because of their "gotcha" fee structures, even if they are paid off. However, I would reconsider if the advantages outweight the disadvantages.I have heard of some of the advantages, but not very much familiar with them. Help me out, if you please.

If you travel on airlines, it is almost mandatory you have one to book flights. Be aware that rewards cards (ones that credit you with miles, points, etc) often have annual fees even if you pay them off each month.

[JohnH]

3) Mileage awards or other benefits for certain affinity cards (airlines, etc)
4) Year-end summaries by account, spending category, etc
5) Limited losses due to stolen or lost card (Debit cards are virtually unprotected)
6) Improvements to FICO scores (debit card usage has no positive effect on FICO scores)

I find credit card transactions a little easier to understand on the statements. A debit card transaction often has limited info on the bank statement, whereas a credit card transaction will include a contact phone number and more identifying detail. So if there's a question, it's usually easy to call the merchant directly. I thin kthis may be true because a credit card statement is oriented strictly toward reporting credit card transactions, whereas a bank statement has to serve multiple reporting purposes (checks, card charges, misc bank transaction types, etc).


Your #2 is no small matter. If you charge for a product or service and the vendor fails to deliver, you can initiate a charge-back process with the credit card issuer. If you pay by check, cash, or credit card, your recourse is usually limited to taking legal action against the vendor. If I get into a dispute, I sure hope it's for something I've charged to a credit card.

[Nashville]

This comes from another thread, but evolves into a different discussion/subject matter.

I made the observation that debit card customers most likely do not have debt as opposed to credit card customers. Taxxcpa responded that his approach involved using a credit card but paying in full so debt does not result.

Personally, I don't have a credit card because of their "gotcha" fee structures, even if they are paid off. However, I would reconsider if the advantages outweight the disadvantages.

I have heard of some of the advantages, but not very much familiar with them. Help me out, if you please.

1. Succinct accounting via end-of-month statements.
2. Ability to protest charges before they are physically paid (tell me more about this).
3. 4. 5. ???