Can Frugal People Use Credit Cards?
February 13, 2009 by Katelyn Thomas
Filed under finances
I had someone ask me the other day whether frugal people could use credit cards. I responded with, “Of course, they can! I use them all the times to spread paint on my canvases when I’m doing the backgrounds and I have one that I use on the kitchen door if someone accidentally locks it.” Then, I realized that the poor guy was asking if it was okay to use them to charge stuff.
Well, that depends. If you run up the bill and don’t pay it off each time, you probably shouldn’t use one. However, if you’re like my friends who charge the month’s bills, pay the card off in full and then redeem their points for gift cards, I don’t see a problem.
What about you? Do you think frugal people should use credit cards to charge things?
Also, do you have a different use for your credit cards? With all of the fake cards I get with credit card offers and used up gift cards I’ve collected, I have enough paint spreaders to last me a lifetime!
Photo by Steve Woods
Yes! As long as I pay them off each month it is a great budget tool that allows me to track my expenditures. Then when Christmas comes around I use the points to get gift cards. A win win situation for me!
I say yes. There was a time where I would first charge and then decide if I had the money but that was also when I bought anything and everything.
We run some of our monthly bills through our one usable credit card for our family. The other card only exists because we got a sweet discount at the store when buying things for our wedding (yay!) and to charge gas ‘n things when we take our college ministry on trips (and then get reimbursed). It helps to keep those budgets separate. We use http://www.mint.com to track our budget and when we use our debit card, it automatically calculates what we spend so we tend to use the debit card for that reason but still treat it like cash.
Yes! I have all of our accounts input into mint.com and it tracks everything. I keep track of my spending and budget – the credit card is just another, more convenient, way of paying.
I say no. If you don’t have money in the bank to buy the item, then you shouldn’t buy it. And I think if you would make that purchase that you cannot afford, then you’re not being frugal.
Absolutely. It’s all about knowing what available funds you have in your bank account, and sticking to that limit. My family has a credit card which rebates us $10 each month if we spend over $1000 (which we do as every single member in our four-person adult family has a card linked to the account, and we swipe everything we buy no matter how small a purchase), and no annual fees, so we actually come off $120 better each year!
I say use credit cards ONLY when you have the money in the bank to pay for the item, pay the balance off, etc.
If you have become good enough at budgeting and have trained yourself to not buy useless stuff you don’t need, you are disciplined enough to use credit.
For example, we used “Bill Me Later” (not a credit card but still credit) for our Christmas shopping. We were able to leave our money in savings and pay off the Christmas bill in 3 installments (90 days no interest) without paying interest. thus we earned interest for us on savings but paid off the credit little by little without paying the bank interest.
Friends of ours use their credit card for budgeting…all the money bills go on the credit card so they can pull it up and see it all at once. They pay it off each month and at the end of the year, get a check or cash credit on their account. Which they always put into savings.
Make the most of your money. While I don’t buy indiscriminately and always think out purchases I make, part of my research process is to see where I can get the most reward for the purchase I make AND verify I have the cash in savings to pay for it. I get paid for my purchase but don’t pay anyone else (like credit card companies)
Yep. We pay the bills in full, and it’s a great way to budget since the bill says *exactly* what I spent every dime on in the last month. And I get money back with the credit card I use. Good deal for me.
I say only if you pay them off in full each month, and you use a card that earns you points for gift cards or cash back. Make sure you are not spending more than you would if you used cash. Many people spend more when using a credit card because it doesn’t feel like they’re spending real money.