Monday, November 28, 2022


Small purchases on credit cards not such a bad idea – if…

By Russ and Tiña De Maris

In a recent reader poll we asked: “On routine store purchases of $10 to $20 how do you most often pay?” Nearly 2,500 of you responded – and a pretty lopsided majority of more than 1,110 of you (47 percent) said, “With a credit card.”

That “plastic purchase” method surprised at least one reader. They work as a cashier in a convenience store and remarked, “It always amazes me how many people will pull out a credit card to pay for a 99 cent drink.” We confess, being members of the 47 percent bracket, dropping a credit card for a $12 meal at a fast food joint, or even 99 cents for a snack at the Quigly-Que, is just our own routine.

We didn’t get any feedback as to why the majority of readers use the credit card as first choice (incidentally, the second-most-preferred payment method was via debit card, with 28 percent choosing this method). Nevertheless, credit card use for small purchases among RVers actually beats use by Americans in general. A survey by finds only 17 percent of buyers use credit cards for small purchases, but that was up by 11 percent from their survey done last year. And another factor – they asked users about making $5 or less purchases – maybe you’re more in line with that when it comes to the low dollar sale.

But using a credit card for small purchases may actually be the smart thing to do. IF you pay off that credit card each month, and so aren’t getting nicked interest on your Big Mac and fries meal, here are some advantages of the card:

Rewards: Our “pay it off every month” card shoots us 3 percent back on restaurant and gas purchases, 5 percent on buys (and that’s a big push), and 1 percent on anything else. Those “cash backs” really do add up.

Return protection: Some cards back you up. Buy something and it doesn’t work out, store won’t take it back? Contact the card issuer’s customer service folks, and you may see that purchase price credited back to your account. Other fraud protection assurances are often better on a credit card than on a debit card. In these times of nasty folks in the woodwork, that’s something to think about.

Tracking: Where did the money go? Buy it with cash, lose the receipt, you’ve lost the information. Fire up your electronic device, log onto your card account, you’ll know where the money went, and when. And at the end of the year, many credit card companies provide a compilation of your purchases, broken out in expense categories.

Building credit: If you’re working on building your credit score, every purchase made, then paid off on time, works to your advantage.

Pay for my ice cream cone break with a credit card? You betcha!



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Magee Willis
4 years ago

Another thing – when traveling, sometimes it is hard to have cash without paying a fairly large out of network fee at the ATM. And I don’t really like to travel with large sums – like enough for a trip – of cash in my wallet. Live in a rural community and almost all ATM transactions are out of network.

Angela Krause
4 years ago

Most merchants factor in the cost of credit card processing fees in the price to their customers. One clearly labeled example is cash vs. credit price of gasoline. So do you save more paying cash or getting those rewards points? Arco is routinely 15-40 cents a gallon below neighboring big name stations. Do I save that money, adding in the 45 cent debit card fee since Arco doesn’t accept credit cards, or go to the Flying J and get my 5 cent per gallon discount with Good Sam and points paying with my credit card? It’s quite the game to figure out but the house always wins.

Lou King
4 years ago

Something to consider. For each CC transaction the merchant must pay 20-30 cents plus ~3% of the amount in fees to their card processing company. So for that 99 cent drink that is 23 cents in fees. For a small business or the owner of a franchise that is a lot of their profit on that drink!

If you don’t miss the level of individual service being lost along with the city center stores and do all your shopping at big box stores, OK. On the other hand you should not bemoan the loss of the small towns, businesses down town, city centers, family owned shops & businesses and even the family farm. We do vote with our feet and our money.

Wolfe Rose
4 years ago

Something I realized way back in college: If you charge most things right after the bank issues the credit card bill, you will get a month before the charges appear on your next bill, and then another month of grace period FREE before you should pay it off still at ZERO interest. If you charge everything you possibly can, almost every dollar visiting your hands gets that 2 month free loan – thousands of dollars each month, millions of dollars a decade, maybe 5 million per lifetime (more if you’re making above subsistence income). If someone offered you a 60 day 5 million dollar loan FREE, would that help you? Most folks “know” about the grace period, but few *use* it aggressively. There are tricks for using this effect even more aggressively by rotating balances, but I don’t recommend those.

In addition to the above benefit of credit, checks are washable/clonable, checkcards are instant-drain and hackable, and cash gets lost/stolen… If someone molests a credit card, you owe nothing for the fraud and are safely insulated.

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