Should I get a Credit Card?

[yvan300]

I'm thinking about getting a credit card. I'm young and not really sure about the pros/cons of getting a card. Opinions on the matter would be nice along with answers to a few questions I have.

1. I was reading online that a credit card can help build your credit score and a good credit score can help you get loans for buying a house etc. The articles were american, so I'm not sure if the whole credit score thing applies locally. So would the credit card help in that aspect?

2. I'm not sure exactly how the interest on the card is calculated. In a lot of articles, they mentioned that if you pay off the amount on the card every month, then you aren't charged interest on the purchase? Is that true?

3. If number 2 is true, then basically you can use your credit card as a debit card, once you don't spend more than your pay check can handle. That means you'd get points for free in a sense once you purchase everything through the credit card.

4. Are the point earning system thing a gimmic? Because I was looking at some cards from rbc and you basically get 20 cents on every 20 dollars spent, which is quite low IMO. Can one expect to get realistic returns from earning points?

If anyone has any more info on the pros/cons or catches of owning a card, it'd be really appreciated and help me make my decision.

Thanks for the help.

[carholics]

In for answers

[jm3]

Having a credit card opens up a lot more options with regard to purchasing power and if you travel.

[baigan]

Yes you should get it just be responsible with it....
Don't go overboard on spending, pay it off, pay on time, keep your balance below 70% of your limit etc

No interest if you pay off in time, the grace period is the number of days you have to pay your bill before interest is charged except for cash advances.

Yep the points work pretty okay, you can claim rewards depending on how many points you accumulate. Gift cards, travel etc
I've been getting around 2-4 flights a year free with the points system. Works for me so far. You can also use them for hotels and so on and so on

[cherrypopper]

Remember its a loan... treat it as such and you'll be fine.

[skylinechild]

in for answers as well but just remember...its a CREDIT card..ie you'll be spending money you dont technically have or have not earned as yet...

it can get you out of a jam when needed but again you'll need to pay back any money used - plus interest - when you cant pay back on time the bank just increase the interest.

if you cannot control your spending habits..then a credit card is a bad idea for you.
used conservatively it can help you in the long run.

[Cooloh]

Good info here:

http://www.magnifymoney.com/blog/buildi ... edit-score

[hong kong phooey]

yvan3000
i am answering in this post because you seem sensible by asking questions first (my views expressed below)
Credit cards have loads of advantages and one major disadvantage.
Disadvantage
You have a line of credit which occurs very very very high interest rates. this is the major way they make there money people spend and cannot payback. they pay the minimum and the rest occurs interest.
Trinidad is not like the US. Banks dont just send it to you. you have to go apply. I use a family's address in the us for transactions and I get credit cards from banks up there, which i just destroy.
with this i n mind your point 2 is valid. to make your card work for you you need to pay your balance before the due date and this way you dont occur any charges.
Another disadvantages is certain credit cards have a yearly fee associated with it. I dont know the exact fee for each as it varies by the type of credit card and the bank. i have two credit cards with republic : one has no yearly fee but i have the limit restricted to 500 US , and the other one with a higher limit but that one has a 80 US (500 tt) yearly fee. for me this works because i make much more in my points. so the credit card is working in my interest.
Another issue is the bill. Although Republic credit card service is great. the bill does not arrive on time. the bill in the post normally arrives after the due date. so you need to know when your date is due and pay your bill before, or set up an automatic payment system. I dont know if this is republic fault of ttpost fault.

Advantage.
1. points - you have options you could get miles , cashback etc which is basically free money
2. If you travel and you have an international card you can use it almost any where.
3. fraud protection: Republic is great for this. any strange purchase and they call( you can notify them before).
4. Insurance : you get a certain % of insurance when you purchase airline tickets or rent a card ( again this can vary from card to card). in the US i dont have to pay for insurance(which is optional) because i know the card provides it.
5.Online shopping / paypal . these accept your credit card so it makes it easier to pay for goods and services .
6. Bookings tickets /hotels/restaurants . etc


Hope this helps
you just need to be sensible

[nervewrecker]

You can check your bill via republic online and pay it from home. I always do this, never had issues.

[SR]

Make sure you can pay off your credit card each month.. if you cant well then no dont get one

[hindian]

Get a prepaid credit card and learn to use and manage it first (I did that) and after apply for the real deal if you wish. That way you only spend money you have and won't put yourself in debt incase you get glad and go spree. I have 2 cards one with RBC and the other with FCB. You just have to mak sure you manage you finances properly and you good to go.

[neexis]

I've never gotten the impression that local banks use credit card activity to determine a credit score/history. I once asked a banker and she shrugged it off.. said they usually use bigger stuff like loans to determine that.

Make sure you can pay off your credit card each month.. if you cant well then no dont get one

Basically this. CC's create the illusion of money you don't actually have.

[pugboy]

definitely, I use credit card for everything, cheapest one month loan you can get
pay late, you better get out the vaseline.

a credit card user's discipline is a very good predictor of financial success in life
and usually not something that can be every changed no matter how hard you want to change your spending habits, once a money spender, always a money spender

if you cant manage a simple thing as a credit card then very likely you will always be short on
money no matter how much money you make...........

[Slartibartfast]

Some good info here so far. As long as you are responsible with the credit card it is a good idea to get one. If you are the kind of person that will be tempted to spend money you don't have then stay away at all costs. But here are some pros and tips for you to get the most out of it.

1. Use your credit card like a debit card. If you overpay your credit card bill you end up with a positive balance. If your bill is $0.00 you can basically throw money on to it and use it like a debit card. This way you don't have to worry about late payments because you are never actually using the banks money. However you are still getting all of the rewards. You are also able to purchase expensive items that are above your limit because you have extra money on the card. Your bank card has a set limit that you can use for POS purchases so this is another advantage of the credit card system.

2. Get internet banking. Don't wait on your credit card bill to reach before you decide to go and pay it off. Online banking is free and available in most (if not all) major banks. Once you go into the negative (i.e. start using the banks money) log in and pay it back as soon as you reach home.

3. Make all your purchases with your credit card. Unlike a bank card, where you pay the $4 service charge, when you use a credit card the merchant has to pay the service fee. Again, don't forget about points 1 and 2.

[Dizzy28]

In addition to what was said above WRT to cost of card the annual fee for my card with FCB is $145.
And wtf is a prepaid credit card?? If I prepay then its no longer credit!!!

[Miktay]

Easy money aint 4 the weak minded.

[nervewrecker]

In addition to what was said above WRT to cost of card the annual fee for my card with FCB is $145.
And wtf is a prepaid credit card?? If I prepay then its no longer credit!!!

Maybe a vtm card.

[originalbling]

Good info here.

In addition to what was said above WRT to cost of card the annual fee for my card with FCB is $145.

Visa and Mastercard annual costs vary between banks, some are $275, platinum is even more.
I know RBC interest rate is about 25.2% annually, so make sure and pay by deadline date.
You can also use your credit card to get cash from an atm in case of emergency etc. but that interest rate also kicks in.

[Slartibartfast]

Typically 3% for withdrawing cash from an ATM (they call it a "cash advance"). So if you take out $300 from another banks ATM that $4 service fee + 3x3 = $13.

[Monk BANzai]

Intercommercial Bank has a VTM card that requires ONLY that you open a Savings account with them..(Usual initial requirements of Utility Bill, two forms of ID ..they didnt ask for a pay slip..as other banks area claiming is a requirement now by Central bank......fuqqqin liars) in fact they offer you the card as standard along with the ATM card you get. And topping up just requires you make the deposits... not produce bone marrow smaples like the other banks (FCB/RBL) dont even charge you a percentage on the deposit. I thought it was unheard of until a business colleague of mine confirmed and I can also confirm. I haven't used the card to do ATM withdrawals, but the same 3% exists as other banks.

There's also TSTT's new initiative:

http://technewstt.com/pr-tstt-mobilemoney/

In developing and emerging countries such as Trinidad and Tobago, mobile money solutions are a means of extending financial services to the community known as the ‘unbanked’ or ‘underbanked’. However, the development of mobile money is now pervasive in developed countries and represents the mechanism that keeps customers connected.

[baigan]

Intercommercial Bank has a VTM card that requires ONLY that you open a Savings account with them..(Usual initial requirements of Utility Bill, two forms of ID ..they didnt ask for a pay slip..as other banks area claiming is a requirement now by Central bank......fuqqqin liars) in fact they offer you the card as standard along with the ATM card you get. And topping up just requires you make the deposits... not produce bone marrow smaples like the other banks (FCB/RBL) dont even charge you a percentage on the deposit. I thought it was unheard of until a business colleague of mine confirmed and I can also confirm. I haven't used the card to do ATM withdrawals, but the same 3% exists as other banks.

There's also TSTT's new initiative:

http://technewstt.com/pr-tstt-mobilemoney/

In developing and emerging countries such as Trinidad and Tobago, mobile money solutions are a means of extending financial services to the community known as the ‘unbanked’ or ‘underbanked’. However, the development of mobile money is now pervasive in developed countries and represents the mechanism that keeps customers connected.

D bmobile chick look good

[bluesclues]

remember to protect your card. As if u lose your prepaid card well, anyone can spend all the money on it.

Whatever option u use, regular or prepaid, make sure u understand the bank's lost/stolen and usage protections and how to protect yourself from liability if ur funds go mysteriously missing. Some people may find it too tedious, but having the bank call you to authorize a payment every time you use the card would provide you the best security against unauthorized use.

for online purchases, you want the bank to authorize only those purchases which match the address(s) on your file. Their merchant should be able to handle this kind of verification process based on the creditcard information submitted for the purchase. If you want to add another address later ud have to go into the bank. Which may be a bit inconvenient, but a small price to pay to ensure ur money doesnt runaway while ur not looking and leave u in debt.

Creditcards are not secure. Bare that in mind. Be vigilant and protect it just like if is $5000 u have in your pocket because that is what it is. Keep it safe and only pull it out when you need to use it. As it's ur first. Id advise leave it home in a set safe place until u want to buy something with it.

Bitcoin beats all these systems for security tho. Even if i lose my phone, thief might be able to see my balance, but cant spend a dime.. lol. You could move ur balance if ur address is compromised at the nearest internet cafe or other device with internet access. Portable secure money.

Also the inverse occurs for virtual currency. Instead of paying fees and interest on purchases. With bitcoin u get 3-5% discount sometimes more whenever u make a purchase with bitcoin. Untop of which u may also gain reward points for future purchases amounting to 10% of ur purchase value or $5 on every $50 u spend. Been doing it for years. It's great. Dont need a creditcard ;P

Best of all ur money is stored in an investment which can give you as much 100% interest on savings annually through some of the 300 options to benefit from in online trading, transferrable to any currency in the world.

So creditcard - fees, security issues
Bitcoin- portability, rewards, discounts, interest on savings, investment potential and ultimate personal finance security.

[desifemlove]

prepaid credit cards all the way. "normal" credit cards too much hassle wit interest.

JMMB, Republic Bank, FCB, all do it. JMMB is VISA, FCB mastercard.

watch out for the maintenance and reload fees though. they can charge you based on how much you put in/reload, and may take out once per month as account maintenance.

avoid the traditional credit cards like the plague.......serious people get into debt wit dat, at least then yuh know what yuh upload. people say sometimes it a hassle to go into the bank and upload, not really. it takes 5 minutes to sign and seal an envelope and put in the deposit box, or 2 minutes max to use the ATM to get the money out to place in the envelope, hahaahha..what hassle BS is that?

[redmanjp]

is there a way to find out your credit score independent of the bank?

[adnj]

The USD limit is going to be restricted per person so would not make a difference how many credit cards you have with a bank. As is the practice now exceptions are also made at the discretion of the bank (i.e. high net worth individuals and politicians with have much higher USD limits.)

They could get a card from another bank

After the credit card application is completed, they run a credit score on you with Transunion. The report shows all your previous and active credit facilities. So if you have a credit card at one bank and you think that is just to get another card at another bank, it's not that easy and will only allow you if they see you are managing all your debt properly (no defaults, no delinquent debts, paying on time, and especially your income is much higher than your expenses).

You can beat the system a bit if a family member you trust (and also trusts you) applies for a CC.

Just drop the limit on the republic card so you only at the US limit of 5000 then apply for a credit card elsewhere for the other 5000 that was cut

Drop your credit limit - lower your credit score.
Close a credit card - lower your credit score.
Increase your credit utilization rate - lower your credit score.
Apply for new credit - lower your credit score.

[Mmoney607]

The USD limit is going to be restricted per person so would not make a difference how many credit cards you have with a bank. As is the practice now exceptions are also made at the discretion of the bank (i.e. high net worth individuals and politicians with have much higher USD limits.)

They could get a card from another bank

After the credit card application is completed, they run a credit score on you with Transunion. The report shows all your previous and active credit facilities. So if you have a credit card at one bank and you think that is just to get another card at another bank, it's not that easy and will only allow you if they see you are managing all your debt properly (no defaults, no delinquent debts, paying on time, and especially your income is much higher than your expenses).

You can beat the system a bit if a family member you trust (and also trusts you) applies for a CC.

Just drop the limit on the republic card so you only at the US limit of 5000 then apply for a credit card elsewhere for the other 5000 that was cut

Drop your credit limit - lower your credit score.
Close a credit card - lower your credit score.
Increase your credit utilization rate - lower your credit score.
Apply for new credit - lower your credit score.

Yea and once your credit score goes down, it could never go back up

[zoom rader]

The USD limit is going to be restricted per person so would not make a difference how many credit cards you have with a bank. As is the practice now exceptions are also made at the discretion of the bank (i.e. high net worth individuals and politicians with have much higher USD limits.)

They could get a card from another bank

After the credit card application is completed, they run a credit score on you with Transunion. The report shows all your previous and active credit facilities. So if you have a credit card at one bank and you think that is just to get another card at another bank, it's not that easy and will only allow you if they see you are managing all your debt properly (no defaults, no delinquent debts, paying on time, and especially your income is much higher than your expenses).

You can beat the system a bit if a family member you trust (and also trusts you) applies for a CC.

Just drop the limit on the republic card so you only at the US limit of 5000 then apply for a credit card elsewhere for the other 5000 that was cut

Drop your credit limit - lower your credit score.
Close a credit card - lower your credit score.
Increase your credit utilization rate - lower your credit score.
Apply for new credit - lower your credit score.

Yea and once your credit score goes down, it could never go back up

Not true

[zoom rader]

The USD limit is going to be restricted per person so would not make a difference how many credit cards you have with a bank. As is the practice now exceptions are also made at the discretion of the bank (i.e. high net worth individuals and politicians with have much higher USD limits.)

They could get a card from another bank

After the credit card application is completed, they run a credit score on you with Transunion. The report shows all your previous and active credit facilities. So if you have a credit card at one bank and you think that is just to get another card at another bank, it's not that easy and will only allow you if they see you are managing all your debt properly (no defaults, no delinquent debts, paying on time, and especially your income is much higher than your expenses).

You can beat the system a bit if a family member you trust (and also trusts you) applies for a CC.

Just drop the limit on the republic card so you only at the US limit of 5000 then apply for a credit card elsewhere for the other 5000 that was cut

Drop your credit limit - lower your credit score.
Close a credit card - lower your credit score.
Increase your credit utilization rate - lower your credit score.
Apply for new credit - lower your credit score.

The credit card con job

[adnj]

The USD limit is going to be restricted per person so would not make a difference how many credit cards you have with a bank. As is the practice now exceptions are also made at the discretion of the bank (i.e. high net worth individuals and politicians with have much higher USD limits.)

They could get a card from another bank

After the credit card application is completed, they run a credit score on you with Transunion. The report shows all your previous and active credit facilities. So if you have a credit card at one bank and you think that is just to get another card at another bank, it's not that easy and will only allow you if they see you are managing all your debt properly (no defaults, no delinquent debts, paying on time, and especially your income is much higher than your expenses).

You can beat the system a bit if a family member you trust (and also trusts you) applies for a CC.

Just drop the limit on the republic card so you only at the US limit of 5000 then apply for a credit card elsewhere for the other 5000 that was cut

Drop your credit limit - lower your credit score.
Close a credit card - lower your credit score.
Increase your credit utilization rate - lower your credit score.
Apply for new credit - lower your credit score.

Yea and once your credit score goes down, it could never go back up

Why can't it go up?

[adnj]

The USD limit is going to be restricted per person so would not make a difference how many credit cards you have with a bank. As is the practice now exceptions are also made at the discretion of the bank (i.e. high net worth individuals and politicians with have much higher USD limits.)

They could get a card from another bank

After the credit card application is completed, they run a credit score on you with Transunion. The report shows all your previous and active credit facilities. So if you have a credit card at one bank and you think that is just to get another card at another bank, it's not that easy and will only allow you if they see you are managing all your debt properly (no defaults, no delinquent debts, paying on time, and especially your income is much higher than your expenses).

You can beat the system a bit if a family member you trust (and also trusts you) applies for a CC.

Just drop the limit on the republic card so you only at the US limit of 5000 then apply for a credit card elsewhere for the other 5000 that was cut

Drop your credit limit - lower your credit score.
Close a credit card - lower your credit score.
Increase your credit utilization rate - lower your credit score.
Apply for new credit - lower your credit score.

The credit card con job

If you can't get credit, for whatever reason, it's really not necessary to to blame everyone else.