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My name is coreysw12, and I'm a recovering debit card user.

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Established Contributor

My name is coreysw12, and I'm a recovering debit card user.

I'm not new to credit cards - I've had a few, in varying degrees, for 20 years now. But I just never really understood the benefits and strategies of properly using credit cards, and maybe I was scared that it would drive me into unrecoverable debt. 95% of the time, I paid for things with my trusty debit card - usually after checking my mobile banking app while standing in the checkout line, to make sure it wouldn't be declined or cause an overdraft. I only really used credit cards when, after doing said "checkout line bank account check", I found that indeed my debit card would be declined. Only then would I resort to the credit card. In fact, I had it in my mind that that was pretty much the only reason for having credit cards.

 

After getting into debt trouble and a credit crisis, and subsequently recovering from it and rebuilding, I decided to take the time to learn what these magical credit card thingies are actually good for.

 

It's been 18 months, now, since the last time I used my debit card anywhere besides an ATM... and my financial life is vastly better as a result. What used to be the bane of my existence, is now a fun and rewarding hobby. Wish I'd educated myself sooner.

    Total Loan Balance: $28k / $70k

    Total SL: $41.2k
Goal cards:



United 1K - 675,000 lifetime flight miles    |    Chase 6/24
Message 1 of 22
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Super Contributor

Re: My name is coreysw12, and I'm a recovering debit card user.

Yep I was in the same boat. It wasn't until I was looking for a way to send my roommate to the grocery store with a card but not let him have access to the $40K in my checking account at the time (SSDI back pay) that I started realizing the benefits of using credit cards. Capital One sent me a letter for the Platinum and I told the roommate it had a $200 limit and let him use that for groceries. I kept using my debit card until I found out I could convert the Platinum to QS 6 months later. From that point I was interested in getting cash back for everything so I stopped using the debit card. 

Now the only thing I use debit cards for is sending and receiving with Zelle and I have a Cash App debit card that I load up for 10% cash back on groceries (because that's a steal of a deal and I would be stupid not to take advantage of it). 




Message 2 of 22
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Frequent Contributor

Re: My name is coreysw12, and I'm a recovering debit card user.

I've also recently switched to running everything through my cc's.  Started doing it in about June or July.  I've had credit cards for a long time, but only really used them for large purchases or online orders.  Everything else was on the debit card, mostly b/c I found that to be the easiest way to keep track of my spending w/o looking at a website or app all the time.  But since March, almost everything we've bought has been purchased either online, at the grocery store, or at the pharmacy.  That, plus our tightened budget making me look at cb rewards in a way I hadn't before (previously, I hadn't cared all that much about it), has pretty much phased the debit card out completely for us.  Now that we're getting cb on everything I doubt we'll go back, even though, ultimately, it's a very small amount of money.

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Message 3 of 22
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Valued Contributor

Re: My name is coreysw12, and I'm a recovering debit card user.

Very brave of you @coreysw12 ! I still swipe my debit a whole lot. I have previously ended up in a predicament where I overspent on credit cards and it was shakey there for a minute seeing the debt piled up a few years back. I'm so paranoid that I reverted to using my debit card for everything so I could always be sure it was there.

 

I still use my credit cards but in very planned, strategic ways that I am sure I'll be able to pay off mostly in full or if not, within a month. I hardly end up paying interest but I am still cautious. My income is lower than what it was a year ago (by about a third) and it was with my previous income that I ended up in trouble. With some UR's, income tax returns, and determination, I was able to walk my debt back down over time. My issue is that when everything is a "necessity" it becomes easy to rationalize just tossing it on the credit card and not thinking too much about it. 

 

P.S. Don't buy a home, a home entertainment set, take an extra vacation, and have multiple dental procedures all within one year. 

P.P.S. Having a large purchase on a 0% interest plan for 2 years did not help the anxiety of having so much debt. Yet I almost convince myself every other week to buy that TV I've been drooling over...or a new phone or smart watch. Half of my debt was 0% interest and yet I was still in a state of panic until I walked at least the interest-accruing debt back down to under $1,000. 

"Show your thanks with action! Hit the "Kudos" button (the stripe with the star) for every post you find helpful to show your appreciation to the community of great individuals who help you on these forums" -Me

Active Cards: Chevron Texaco, Amex BCE, Barclays Ring, Chase Freedom, Chase Freedom Unlimited, Best Buy Visa, Marvel MC

Message 4 of 22
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Re: My name is coreysw12, and I'm a recovering debit card user.


@SecretAzure wrote:

Very brave of you @coreysw12 ! I still swipe my debit a whole lot. I have previously ended up in a predicament where I overspent on credit cards and it was shakey there for a minute seeing the debt piled up a few years back. I'm so paranoid that I reverted to using my debit card for everything so I could always be sure it was there.

 

I still use my credit cards but in very planned, strategic ways that I am sure I'll be able to pay off mostly in full or if not, within a month. I hardly end up paying interest but I am still cautious. My income is lower than what it was a year ago (by about a third) and it was with my previous income that I ended up in trouble. With some UR's, income tax returns, and determination, I was able to walk my debt back down over time. My issue is that when everything is a "necessity" it becomes easy to rationalize just tossing it on the credit card and not thinking too much about it. 

 

P.S. Don't buy a home, a home entertainment set, take an extra vacation, and have multiple dental procedures all within one year. 

P.P.S. Having a large purchase on a 0% interest plan for 2 years did not help the anxiety of having so much debt. Yet I almost convince myself every other week to buy that TV I've been drooling over...or a new phone or smart watch. Half of my debt was 0% interest and yet I was still in a state of panic until I walked at least the interest-accruing debt back down to under $1,000. 


I know the feeling - I am far from debt free. I still have 10k in credit card debt that I'm gradually trying to get paid down. A few months ago it was closer to 20k. Through a combination of cleverly timing my PIF payments (paying the cards off with the closest due dates, while making new charges to the ones with the most distant due dates) and using 0% offers, I've managed to avoid interest. And since literally ALL of my income and expenditures get cycled through my cards, I've been racking up a metric ton of points.

 

It will be nice when I'm at the point where I don't have to use clever trickery to avoid interest anymore, and can just use my cards as normal and PIF without any hassle every month. I'm probably 6-12 months away from that point still, but at least the debt is slowly declining and not the other way around. And not wasting money on interest. So it could be worse Smiley Happy

    Total Loan Balance: $28k / $70k

    Total SL: $41.2k
Goal cards:



United 1K - 675,000 lifetime flight miles    |    Chase 6/24
Message 5 of 22
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Valued Contributor

Re: My name is coreysw12, and I'm a recovering debit card user.


@coreysw12 wrote:

@SecretAzure wrote:

<snip>


I know the feeling - I am far from debt free. I still have 10k in credit card debt that I'm gradually trying to get paid down. A few months ago it was closer to 20k. Through a combination of cleverly timing my PIF payments (paying the cards off with the closest due dates, while making new charges to the ones with the most distant due dates) and using 0% offers, I've managed to avoid interest. And since literally ALL of my income and expenditures get cycled through my cards, I've been racking up a metric ton of points.

 

It will be nice when I'm at the point where I don't have to use clever trickery to avoid interest anymore, and can just use my cards as normal and PIF without any hassle every month. I'm probably 6-12 months away from that point still, but at least the debt is slowly declining and not the other way around. And not wasting money on interest. So it could be worse Smiley Happy


Wow that's impressive. Scary...but impressive. It would probably take me years to pay down $10K of debt. I'd definitely have to sacrifice all of my income tax returns to do it too. I am under 1% utilization now which makes me very happy because next month i'll be able to put away money into my meager savings account (provided I don't get a new iPhone).

"Show your thanks with action! Hit the "Kudos" button (the stripe with the star) for every post you find helpful to show your appreciation to the community of great individuals who help you on these forums" -Me

Active Cards: Chevron Texaco, Amex BCE, Barclays Ring, Chase Freedom, Chase Freedom Unlimited, Best Buy Visa, Marvel MC

Message 6 of 22
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Established Contributor

Re: My name is coreysw12, and I'm a recovering debit card user.

In January, one of my car loans and my personal loan will both be paid off, which will free up another $1300/month for me to pay down my cards with, I'm really excited for that!

    Total Loan Balance: $28k / $70k

    Total SL: $41.2k
Goal cards:



United 1K - 675,000 lifetime flight miles    |    Chase 6/24
Message 7 of 22
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Valued Contributor

Re: My name is coreysw12, and I'm a recovering debit card user.


@coreysw12 wrote:

In January, one of my car loans and my personal loan will both be paid off, which will free up another $1300/month for me to pay down my cards with, I'm really excited for that!


**bleep** Corey, that rocks! I imagine I won't ever have that much disposable income until I retire at 71 years of age. 

"Show your thanks with action! Hit the "Kudos" button (the stripe with the star) for every post you find helpful to show your appreciation to the community of great individuals who help you on these forums" -Me

Active Cards: Chevron Texaco, Amex BCE, Barclays Ring, Chase Freedom, Chase Freedom Unlimited, Best Buy Visa, Marvel MC

Message 8 of 22
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Re: My name is coreysw12, and I'm a recovering debit card user.

I'm also a former debit card user.  A long time ago.  Back in the 90s I ran up about $6-7k in CC debt which cost a lot in interest and took a long time to pay off, and that put me into debt anxiety.  I ended up closing all my cards and paying them off over 1-2 years.  For a while I only used cash or check, and when debit cards first started appearing, I got one and used that, knowing it would give me the convenience of a card with no way to run up any debt.

 

About a year later I was getting married and was planning the honeymoon and discovered (back then at least) that most rental car companies wouldn't take a debit card when renting a car.  So I had to get a credit card again.  But I didn't want to get into the debt spiral again, so I applied for a card thru my local bank and as soon as I got it, I called them and had the limit reduced to $500.  I used the card for odds and ends, and used debit for larger purchases.

 

To this day, over 20 years later, I still do it this way.  I have 3 cards and had the limits lowered on all of them so I can't run up very much debt (my total CL across all 3 cards is $5k).  I still have that $500 limit card, though it's now a BofA Cash Rewards.  The main difference now is all my cards earn rewards, so I put nearly everything on them, and (except for 0% promos), I always pay in full, or pay to zero before statement cut so my low limits don't crash my scores due to utilization.

 

In the rare instance I have to spend more than my limits allow, I use debit.  I haven't paid a dime in CC interest in several years now.  But I earn rewards, so I guess i found, in my own unusual way, a way to make my credit cards work for me.

 

The only debt I have now beyond monthly CC PIF balances is a mortgage.

 

 

I pretend to work, they pretend to pay me. I have pretend credit cards with pretend limits, so I can pretend to buy pretend things and pretend to pay the bills.

Message 9 of 22
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Super Contributor

Re: My name is coreysw12, and I'm a recovering debit card user.

I didn't have a choice last year, as I was rebuilding, and I didn't get my first CC (post-credit issues; I had CCs before, between 2015-2018) until December 2019. I learned to manage my finances a lot better, and I also learned to not overextend/sacrifice myself trying to bail out family. I have better control now, and while I still have some bad habits (still eat out too much rather than buying groceries and cooking for myself), I still always PIF, but I still run up my cards a bit with takeout. Other than that, I'm doing far better. Plus, I try to put away a bit into savings every month now, too. I didn't do that before, partially because I didn't really have any money left over to do so, but even when I did have a little extra, I still didn't. Now I make it a point to put aside some money, even if it's just a few hundred dollars a month.


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