9 Year Mortgage on the Choice Between Going All Credit or Paying Debit Fees

While the option to upgrade your credit card to Gold-status is becoming more available to average bankers and the new monthly $5 dollar charge for debit card users that Bank of America has announced, it is becoming harder to decide what the best financial decision is for you and your family. If you are hearing the rumors that your bank is going to start charging you for using a debit card or you’re seriously considering applying for one of the five  credit card applications you get in the mail daily, 9 Year Mortgage would like to discuss the options and alternatives you have to debit cards or credit cards.

Choosing Between a Debit Card or Credit Card Lifestyle

You aren’t the only one who is upset by the latest trend that started at Bank of America: $5 a month to use your debit card. In fact, many customers are bank shopping at this very moment just to escape $60 a year; either that or they are considering ditching a debit card all together and switching all spending to credit cards. If switching to credit cards doesn’t sound enticing, remember that most banks are also starting to charge clients up to $5 each time they use an ATM. With the likelihood that banks are going to start implying fees wherever they deem worthy, 9 Year Mortgage suggests that customers of popular nation-wide banks may want to start thinking of alternatives.

Now, 9 Year Mortgage would like to point out that there are indeed benefits to both debit cards and credit cards, so before you make a drastic leap to one side or the other we suggest you consider the following:

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  Small banks and credit unions often do not charge their customers fees for using their services; such as a debit cards. Switching your bank accounts to a credit union could not only save you a lot of money in fees, but also provide you with better customer service, customer loyalty, and security amongst these economic turbulence’s.

• Some small banks and credit unions actually give you up to 2% cash back for using your debit card, not including the 5%-20% you can earn for using that debit card at certain locations (depending on the bank)!
• A possible alternative is a prepaid debit card: keep in mind that most of these aren’t free either. Most prepaid debit cards allow you one free ATM withdrawal a month, with each following withdrawal costing you $2 a pop. Another popular prepaid debit card option requires you to sign up for monthly deposits of $2,000 or more with weekly trips to an ATM. If you have a consistent paycheck and feel that you are constantly at the ATM, 9 Year Mortgage believes that this could be a great option for you!
• Remember that green stuff you have in your wallet? 9 Year Mortgage reminds you that there are no fees when it comes to cold hard cash; actually more and more businesses are now offering discounts for those paying in cash! Just remember there is no way to get cash back if you lose or have your wallet stolen. If you do decide to use primarily cash, 9 Year Mortgage still recommends that you have an account with a credit union or local bank near your home that has free-of-charge ATM’s.

When you have considered all of the above options, there is still one more: credit cards. Credit cards can be a great or terrible option for you, depending on how you handle your money. With a credit card you are able to gain rewards for making purchases, all while avoiding fees. Sounds great right? Well the downside is that in order to truly benefit from credit cards, you must pay off your balance in full each month, no if’s and’s or but’s. If you do not, we’re sure you are aware of a thing called interest; which will eventually end up making you pay for that shopping spree twice if you aren’t careful. If you are considering canceling your debit card’s and using primarily credit cards, there are a couple issues 9 Year Mortgage would like to discuss with you.

Premium Credit Card Offers on the Rise

If you have recently been the recipient of offers to upgrade your credit card to a gold or platinum standing, you are not alone; the gold or platinum credit card status is not as rare as it used to be. Within the past year, credit card companies have nearly tripled their offers for these premium cards, with their new target market being those with a credit score of 600 or better, compared to the old qualifications of a credit score of 760 or higher.With this 160 point difference in credit scores, the credit card companies are hoping to attract a large amount of new customers, who may not have perfect credit, but are still considered responsible enough to handle larger credit limits. If you pay off your balances quickly and tend to put all of your spending on your credit cards, 9 Year Mortgage suggests that you are the type of person who these premium card offers are intended for. Premium cards often come with some great perks, but don’t be fooled – often times nothing is as good as it seems.

Benefits of Premium Cards:

• Sign-on Bonuses – Typically you are offered at least $250 in rewards or gift cards, which can eventually add up to $3,000 in such bonuses in a matter of a few months. Many believe it is worth signing up for a premium card for this, and only this reason.
• Unlimited Spending Limits – Many premium cards claim to have unlimited spending limits for its customers; the indefinite possibilities of what your new premium card could be used for tends to draw in many customers.
• Ongoing Benefits – Reward points, two-for-one movie tickets, and things like automatic airfare price tracking are enticing options for many.

Consequences of Premium Cards:

• High Prices – Those benefits 9 Year Mortgage just talked about? Don’t forget that in order to get said benefits you have to pay up to $150! You will most likely pay more than what those benefits are worth is just a couple short years or less.
• Unlimited Spending Limits – Turns out it isn’t unlimited, you just were never informed of its spending limit! And if you find out what your current spending limit is, do not be fooled into thinking that is set in stone. Credit card companies often change your premium card limit without telling you, and without advanced notice; meaning you could be declined a purchase at any time. If this does happen to you, you will end up with high monthly payments and a possible injured credit score.

Wrapping it up with 9 Year Mortgage

It seems to 9 Year Mortgage that whether you decide to use a debit card or credit card, that you may eventually be faced with some sort of a fee. If you are not comfortable switching all your spending to credit cards, 9 Year Mortgage once again reminds you that you can escape those new debit card fees by switching your accounts to a local credit union or even an online bank. However, if you are considering taking up that premium standing and switching to primarily credit card use, know that 9 Year Mortgage only suggests this if you can pay your bills off in full each month. Also, if that premium upgrade won’t quit hounding you – remember if you don’t use the other benefits offered to you, then you may want to consider just using another credit card like the Power Rewards Visa Signature or World MasterCard (which are offered through a variety of banks); such cards don’t have a fee, however the sign-up and ongoing benefits are not as significant as the original premium cards. The choice is up to you, but if you are not seriously disciplined with your money, 9 Year Mortgage advises you to stick to cash and a debit card to avoid the interest and late fees you might incur with a credit card.

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