Cutting up your credit cards?
Have you been shunning credit cards and paying with cash or debit cards these days? Why?
About 8 million Americans stopped using credit cards during the past year, AJC reporter Katie Leslie writes.
Experts say the decline has two sources — consumers whose cards were revoked due to unpaid debts and those who cut up their cards themselves during the recession, Leslie reports.
Which one are you?
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73 comments Add your comment
Cash is King
December 7th, 2010
12:25 pm
I have 2 Visa cards and 2 dept store cards. Store cards have a zero balance and wish I could dump them, but keep b/c it’s against your credit rating to terminate a card. I use the 2 visa cards for purchases you can’t pay cash, such as travel, warranty items, and online purchases. Balance is paid off each month. Living debt free means freedom. Cash is king these days and find better deals when offering cash for negotiable purchases. Credit cards are needed b/c one has to keep a credit rating. Use them in your favor, and not the bank. Not having to pay interest and fees means more fun money for the things I really want to buy.
Kar
December 7th, 2010
12:26 pm
JJ, how much did using Coinstar cost you? 10%? 15%?
Also, how much more money did you have to draw out at the ATM because you were throwing money in a JAR THAT DOESN’T PAY INTEREST? My guess is at least $760.
At least roll your coins and deposit them at your bank. Doesn’t cost you one of those dimes, not even for the wrappers. Open up a Christmas account or something.
wtt123.com » Creditnet’s New Look is Money, Baby – San Francisco Chronicle (press release)
December 7th, 2010
12:36 pm
[...] money management tips, and credit card fun, such as an article featuring 10 Best Credit Card …Cutting up your credit cards?Atlanta Journal Constitution [...]
JJ
December 7th, 2010
12:47 pm
@kar – 8%, and I don’t mind paying that. Let someone else sort it, count it and roll it. I don’t have the time to do that with $750 in coins.
And I didn’t have to pull any extra out of the ATM. It’s called a budget and I stick to it. I hit the ATM once a week.
Geez there’s some bitter people up in here today.
Randal Patrick McMurphy
December 7th, 2010
12:53 pm
Debit card ONLY… live within your means…
Kar
December 7th, 2010
1:04 pm
JJ, a budget is not the same thing as how many times you hit the atm machine. The change wasn’t found money, if you had been more careful you could’ve used it rather use the “yuppie welfare bucks.” The point is, you let almost a thousand dollars languish in a jar and ended up cost you more money rather than earning interest.
If $75 isn’t worth an hour rolling coins while you watch tv, I’d be interested in what was more worthwhile.
Ted
December 7th, 2010
1:28 pm
Why did I tear up my credit cards? Because I got tired of the companies raising my rates and imposing more fees. So, I simply use cash or debit. And no, it is NOT required for you to function with a credit card.
JJ
December 7th, 2010
1:28 pm
What is a Yuppie Welfare buck?
Bright Idea
December 7th, 2010
1:30 pm
Kar, put down the crack pipe. It was $750 only at the end of the year so maybe about a $400 average. That times the wonderful rate of 1.0%APY is about $4. For an hour rolling coins that’s less than minimum wage. And FYI, almost everything is more worthwhile than that.
John
December 7th, 2010
1:46 pm
I only use credit cards because I travel so much, often with the job. The rewards offers with a lot of these credit card companies are a joke. I once redeemed points (1 point for ever dollar spent) for an ipod. The ipod’s actual cost was $179 but I redeemed it for 12,000 points, which means I spent $12,000 just to get a product that cost $179.
cat mama
December 7th, 2010
2:03 pm
I really think if you dicipline yourself and budget frugally, you can pay off anything you want to, and save as much as you need. I have a hard time with Dave Ramsey because I don’t pay things in the order he lists. and he has ONLY filed BANKRUPTCY TWICE! You would think the first go round would have taught him something!? You can do just fine on your own, it’s just a choice to make and stick with. Also if Dave has so much money he needs to get his own radio tower. Out here in west georgia when the sun goes down, 640 AM goes to sleep.zzzzzzzzz
Kar
December 7th, 2010
2:36 pm
Bright Idea, 4% in interest is still more than what the jar was giving. Not to mention having money in the bank to draw on if you need cash flow coverage for a check if there are overlapping time windows. Not to mention the cost of converting coins to dollars.
JJ, Yuppie welfare dollars are also Yuppie Food Stamps, commonly called $20 bills which are the usual demonination for ATMS.
Plain Jane
December 7th, 2010
3:08 pm
I cut up my credit cards and started paying off my accounts in March 2007. I’ll FINALLY have them paid off in summer 2011. (Yes, it was that bad.) Between being laid off twice and being a full-time grad student, the debt got really ugly this time.
I am so done with credit cards. The “just pay it off every month” approach won’t work for me. I want to pull out cash or a debit card and pay for things the minute I buy them from now on. By the time I finish paying the cards off, I will have been living on cash for more than four years, so I think I can continue to do it indefinitely. I don’t have a car or cable or a gym membership, I don’t take vacations, and I go to a restaurant maybe once every two months. I wear my clothes until they literally come apart and I only own four pairs of shoes. I’m not exactly enjoying this, but at least I know that my debt is getting smaller every month and that it’ll be GONE in August. Then I get to start on my grad school loans.
The only problem is that I don’t have any insurance. I had to go to the emergency room in Sept. 2009 and I’ll be paying on THAT until February 2011. Oh, well. Maybe I can afford insurance once the medical and CC bills are paid off. Besides, the hospital, the ER doctor and the imaging clinic aren’t charging any interest. Any credit card bank would have sucked an extra $700 out of me by now.
Cash back and rewards programs sound great, but I’d much rather never see another envelope with a credit card company’s name on it in my mailbox EVER again.
Elle
December 7th, 2010
3:53 pm
First off, Dave Ramsey is making $$$ giving basic advice that everyone should know regardless. Clark Howard as well.
Those you you that are giving up credit cards for good are screwing yourselves over royally if you need the in the future. You’re credit won’t be good enough to get a loan or a card, and where will you be then? You’ll be headed to a “predatory” lender and they stick you with jigh interest rates.
While the idea of cutting up your credit cards sounds like the right thing to do, but financially in the long run it is not. Dave Ramsey didn’t tell you that little nuggett, did he?
CC1
December 7th, 2010
4:47 pm
In regards to all you folks that are “cutting up” your credit cards … “One can quite reasonably infer that’s not voluntary”. A quote from the article on Georgians using less credit because they were forced to, not because it was heroic conscious effort on their (the consumer’s) part.
Quite frankly, those of you that think you can live your entire life without credit are in a fantasy land. If you had done the right things all along you wouldn’t be in this mess.
Hmmm
December 7th, 2010
4:52 pm
@ cat mama
I think Dave Ramsey is a bit of a scam. I also think it is rather amusing that many chuch’s that are seeing their offering plates a bit more empty on Sunday AM are giving out Dave Ramsey advice for free! I think I see an ulterior motive in this whole scheme of things!
A.S.Mathew
December 7th, 2010
7:22 pm
If we are strictly disciplined people to pay off the credit card bills every month, that is a great idea.
But, 99% of the people are keep on using credit cards without ever thinking about the trap they
are creating, and when they realize the eternal trap, it might be too late.
The Banking industry got filthy rich through this credit card business: the interests and late
charges from the customers were their golden cow. The Banking industry had no mercy to anbody,
but they ruthlessly ripped off the customers by the billions. The mega banks were ahead of the
small small banks in looting the public through credit card trap.
For the last two years, I am living without a credit card. I pay everything by cash, and living
without the worry of monthly bills from the credit card companies.
If we can live without getting into the plastic card buying habit, we can be financially safe far
earlier in life. Learn to live within our means, and we need not have to bow our heads to the
creditors. Always the debter will be a slave to the creditor.
Plain Truth
December 7th, 2010
8:58 pm
“The Banking industry got filthy rich through this credit card business: the interests and late
charges from the customers were their golden cow. The Banking industry had no mercy to anbody,
but they ruthlessly ripped off the customers by the billions. The mega banks were ahead of the
small small banks in looting the public through credit card trap.”
Consumer stupidy is the problem, not the “filthy rich” banks! I have been offered more credit that the average American could possibly dream of, but I did not touch any of it! It is all abut personal responsibility. Those that did and continue to do the right things will not buy the load of crap that the banks were at fault. Consumers that default on debt on thieves!
S
December 7th, 2010
9:18 pm
I no longer use checks, I use CC to pay for almost everything and use bill pay to pay for what is left. I pay credit card off in full each month and get money back for Xmas each year. No Fees are paid on any card or bill pay. I save a bunch of money just not using stamps and buying checks. Everything I have is paid for, including where I live and what I drive. Unlike Dave Ramsey, I never got myself in trouble with debt, I knew better right from the start. It’s called common sense.
TnGelding
December 8th, 2010
4:39 am
It took 5 years to pay off our credit card debt in the early 90s, but we never stopped using them altogether. I spent more time in Vegas than metro Atlanta. But I was sick, mentally and physically.
A.S.Mathew
December 8th, 2010
10:42 am
Plain Truth; You might be a rich person with high discipline and self-control in life. Many people,
while passing through the malls, simply carried away by the glittering display of merchandise,
and greatly tempted to buy the unnecessary goods. If they don’t have credit card handy, they will
not jump into that spur of the moment decision to get into greater debt.
There is an old saying in India ” giving a ladder to the monkey climb”. Monkey does’t need any
ladder to climb, but when we give a ladder to the money to climb, it is quite easy for the monkey to
climb.
Whether you agree with me or not, the U.S. banking industry gave the plastic card to every Tom and
Harry without checking their income, and the consumers never thought that they will be faced with
a dry day like we face today. So, the banks and the consumers are equally at fault. The banks
for their greed, and the consumers for their reckless spending while getting into serious debt.
Plain Truth
December 8th, 2010
4:17 pm
“Whether you agree with me or not, the U.S. banking industry gave the plastic card to every Tom and Harry without checking their income, and the consumers never thought that they will be faced with a dry day like we face today. So, the banks and the consumers are equally at fault. The banks
for their greed, and the consumers for their reckless spending while getting into serious debt.”
There is 3rd party you forgot to mention: the federal government. They tell the banks what to do, and the credit card debt is no different than the mortgage fiasco. Also, customers knew they could hold discrimination laws over the CC companies heads, but then cried foul when the rates and fees became astronomical and they could not pay their bills.
Ellen
December 10th, 2010
7:58 am
People tend to overspend when they use rewards cards–16% more according to studies. And no reward cards gives you 16% back. Think how much you’d save by just not using it.