What Do You Use Your Credit Card For, And How Do You Pay It Back?

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Jia Tolentino:

I use my credit cards for everything I buy because of reward stuff (cash on one, miles on the other), even though the dangers of this free-money, anti-budgeting habit has probably done more damage than the occasional plane ticket and $200 check has done me good. Over my 9 years of credit card usage I’ve probably paid them off in full about 80% of the time; I’ve spent those other months running up and paying down waves of temporary debt from unpaid internships, delayed freelance pay, and in the case of this last summer (which I’m still paying off) a one-two-three punch of misunderstanding the structure of my graduate school fellowship, flying to too many music festivals, and receiving 17 wedding invitations over the course of the year. I didn’t go to all of them, I barely went to any of them, but my credit card management program going forward is definitely to start behaving in a deeply unfriendly manner to everyone I have ever known, thus negating the possibility of anyone ever wanting me at their wedding for the rest of my new and anxiety-free life.


Meghan Nesmith:

I got my first credit card last year and I am very fond of it. I find it sort of magical, this idea of spending money I don’t actually have. Initially I made the promise to myself that I would only use it for truly important things, like medical expenses or necessary travel. Then I realized important things could be expanded to include clothes and also really nice meals. Then I redeemed my first cash back prize and found such glee in that act that I started using it for everything. Then I maxed it out. Then I grew horrified at my interest rate and spent a totally useless 30 minutes on the phone attempting to renegotiate it following a script I found online and saying things like, “I may be forced to take my business elsewhere.” As my credit limit is only $2,000, they were oddly unmoved by my hardlining. Now I’m paying it off in fairly decently sized increments as I recently got a new, better paying job. I think when I pay it all down I may continue using it frequently to reap those piddling cash-back rewards, but will treat it less like fake money and more like an extension of my debit card. Poor, neglected debit card.


Laura Yan:

I use my credit cards for almost everything that isn’t a cash only restaurant or bar. Impulsive clothes shopping online! Impulsive bus tickets and flights! Lots of impulsive books for my Kindle! Getting cash back gives me the sense that using my credit card is somewhat productive.


Lilly O’Donnell:

I have all of my monthly bills (phone, cable, electric, student loans) charged to my credit card automatically. This way I only have one bill to remember to pay every month and don’t have to live in constant fear of forgetting and ruining my credit, and I get rewards points that add up to a free flight every few years. Then on the first of every month I put everything that’s left in my bank account after I pay my rent toward my credit-card bill. It’s rarely the full balance, but it’s enough to keep it from getting out of hand (except for what’s leftover from the month I spent unemployed, which I’m scrambling to pay down one extra bar shift or freelance editing gig at a time).


Katherine Coplen:

My mother has been completely credit card free her entire life (go, Mom!), but, despite her vocal protests, I applied for a card when I was 19. I’ve had one credit card since I was a sophomore in college — a gas rewards card. For the first several years I had it, I used it almost exclusively for gas, and paid it off every month. But something happened to me this year. Something inside my mind must have gone loose, because I managed to lose my debit card five separate times. (Once, when I was inside the bank applying for yet another debit card, I found the one I was replacing in the recesses of my wallet.) So I’ve been using that credit card in place of a debit card periodically this year, paying it off every month through an auto-pay feature. It just shwooops that money right out of my checking account, right around the 20th of every month.


Jon Custer:

I never had much in the way of credit cards — I had one $500 card and one $1,000 card during and after college, which got me out of a few scrapes (like paying a bribe to escape a foreign airport or springing for a hotel when all the hostels were full in Quebec City — one of the best sleeps of my life!). Usually I would pay them off when I got whatever big chunk of money I was waiting for, then gradually run them back up again when that money run out.

Like many people my credit was destroyed during the Financial Crisis, but I recently was able to qualify for a new $500 card. The original plan was to use up about 20% of that and then pay the minimums, so as to help rebuild my credit and have some left over for emergencies. Of course, thanks to being “just a little short” in the days before payday I’ve now charged that one up near the limit too. I’m not too worried about it because I can easily pay most of it off every paycheck, but it would be nice to get it near-fully paid down and just leave it there. Maybe with my tax return…


Matt Powers:

I use my credit card everywhere possible because I have an Amazon rewards card so it’s like I’m paying myself every time I use it. I especially try to use it at grocery stores and restaurants because I get extra rewards points back at those places. My mom has an LL Bean rewards card which is essentially useless once you have a pair of boots and a nice coat (and maybe a toboggan), so she sometimes offers to use my card when she’s making a purchase on Amazon and then pay me back separately. My mom and I are scamming the credit card company. Please do not tell anyone.


Taylor Jenkins Reid:

In my early twenties, I used my credit card to buy things that I couldn’t afford and then made myself sick thinking about it. But I’m proud to say, a week away from turning 30, I have learned to use my credit card much more effectively. I use it for all of my purchases and I pay it in full at the end of the month. This way, I earn rewards and keep track of my spending on a regular basis. The only problem is that at any given time I can see exactly how much money I’ve spent in a year and it always makes me nauseous.


Brittany Shoot:

I use my credit card for everything I can, and so does my husband. We pay off the balance in full every month, and even though I have premier status on United Airlines and fly most everywhere with them, I get a few JetBlue flights for free every year since I use my credit card so much. I’ve had it for seven years, and I pay a cool $40 annually for the privilege of keeping it. Since I’m never stuck paying interest, it’s a great deal for me/us! (Only downside is that adding my immigrant husband to the account doesn’t actually help his credit score since I’m the primary account holder. Irrelevant to most, a wee bit frustrating for us.)


Amanda Green:

After inheriting a healthy fear of credit card debt from my parents, I now use one credit card for almost everything and then pay off the balance each month. I do it for love and airline miles — I’ve been in a long-distance relationship for about a year-and-a-half.


Heather Sundell:

My father is a chill hippie man with only real parenting rule: Don’t use your goddamn credit card, Heather! He gets this from his father, my grandfather, a staunch FDR advocate who lived through The Depression, and learned to never put anything on credit. As such, he has instilled the fear of compound interest in my heart, and I’ve remained relatively out of credit card debit during my twenties. Obviously, I want nice things like Coachella tickets, sweaters from Madewell, and even a plane ticket to NY. Obviously, I cannot always pay for these things at once. So, I use my credit card. My debit card is my day to day mode of payment, and I use my credit card to buy bigger ticket impulse purchases. I do this partly because I can’t pay for the entire sum at once, and partly because if it goes on my credit card, I don’t really see it and it doesn’t exit. Ipso facto, I don’t need feel buyer’s remorse.

When I was in my early twenties, I would put big purchases on there without adding up the numbers in my head and ended up paying the minimum every month, cutting down big chunks if I fell into a birthday windfall. It felt impossible to get out of, always seemingly like I was $1k in debt. As I got a little older, I started being able to pay off my balances quicker, and became more discerning about what I put on the card. Also, I wised up and got myself a card that at least earned cash back, which I use as my main credit card, in addition to an older back up card I keep in a drawer somewhere. Now, most months I have a small balance on the primary card that I use, except this month because all my Dad asks for as a birthday present every year (it’s next week) is that I pay off my credit card. Happy birthday Dad, no debt!”


Miranda Popkey:

I have one credit card, almost maxed out. I used it to buy treats like sweaters and bourbon and fancy dinners for one, please, and yes I will have that second glass of wine. Then I got paid for a freelance assignment I’d completed months ago and had basically forgotten about and I paid my credit card off completely! So liberating. A few weeks later, I bought tickets to LA. And here we are again.


Rebecca Pederson:

I have two credit cards, which I use for the exact reason that gets people in financial trouble: to buy things I technically don’t need and definitely can’t afford. This year, I used credit cards to buy roundtrip plane tickets from San Francisco to Chicago for a “just because” vacation to see an old friend, stuff for the four weddings I attended this summer, and a washer/dryer set that cost $2200.

Despite these big ticket purchases, I currently have no debt on either. When I have an outstanding balance on a card, I will put all of my paycheck towards the next payment, minus literally like $50 for emergency afterwork happy hours.

I choose which cards to pay down aggressively based on which purchases I’d be most embarrassed to explain to my financial advisor. Example: I bought four different dresses for these summer weddings that all look basically the same except for their varying shades of green. I paid those off immediately, so now we can pretend like it never happened. Honestly, I don’t even know what my credit cards’ interest rates are. Is that bad?


Cara Dudzic:

I use my credit cards for paying for things online, or for when it would be awkward to pay for a purchase with small bills. I always have some cash because I work a couple of different tipped jobs, but sometimes it’s more than I can bear to count out $80 in ones and fives to buy groceries. I pay them off with some difficulty sometimes. I don’t like depositing cash in the bank, and sometimes I’ll overspend on my credit cards, because it’s too easy. A few months ago I got a credit card through the same company that holds my mortgage, and added my husband to it. It gives us some tiny percentage of our spending as a rebate on our mortgage, so spending with that card feels falsely virtuous. Like, here we go, score another one for paying off the house. Thanks, card. But we just agreed to limit our use of it, because the statement is separate from our regular bank accounts, and we don’t have a reminder of our spending like an account balance dropping. More like, oops, you just spent a giant amount of money on nothing. I really try not to carry a balance month to month on any card unless it would mean I was overdrawing or definitely setting myself up to overdraw.


Christian Brown:

I use my credit card mostly for income smoothing. That is to say, I am a freelancer, so sometimes I get paid my checks on time, and sometime I don’t. When I don’t, I’ll float myself a one-month loan, basically, by putting it on a credit card. I’ve had one or two month gaps where I don’t get any pay at all (even though I’ve been working) and being able to smooth that out with short-term credit is great. I pretty much am able to get my income often enough on a month by month basis that I can pay it down to zero every month, although there were a few times this summer when I chose to let it ride a month and pay about half of it off. (This mostly is because of House Things, like renovations and furniture, that were jostling up against some late checks.) So far, I’ve managed to avoid letting it build up because if anything credit cards feel MORE like “real money” to me than cash does.


Abby Dalton:

I use my credit card for most purchases over $10, because paying with a credit card for something less than that makes me feel guilty about incurred fees for small businesses (which I should probably feel guilty about for purchases over $10, but carrying around more than $40 at a time makes me nervous). I pay the card off in full every month, and sometimes multiple times a month, because looking at a balance makes me nervous. I have one of those cards that gives you money for “points,” which I redeem a couple of times a year for cash, which promptly gets spent on nonsense.


Shannon Palus:

I use mine for absolutely everything I can use it for. I think its a rewards card, though I’m actually not really sure because I only started using it recently. When I lived in Montreal I had a rewards card and every now and then a $50 credit showed up on my statement, so I got into the habit of using the card for everything so that would happen as often as possible. My current card linked to my checking account, so every time (or so) that I log in to check my balance (daily, because that’s how I budget), I just pay off whatever is on it.


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40 Comments / Post A Comment

OllyOlly (#669)

Thinking about this made me realize that to me cash is fake money, and using my credit card feels like I am actually spending something. This may be a Mint syndrome, as the ATM withdrawal comes out online and then what I spend it on doesn’t matter, it is already gone from my bank account! Where as all my credit card expenses show up in great detail sucking the life out of the budget bars and turning them from green to yellow to red.

No one asked but I have four credit cards, and always pay them off. A student card, a capitol one card for international travel, my first rewards card (chase freedom), and them my amex I pay a fee to have since I still come out ahead of the rewards on my chase. The amex also has deals like “$25 off $75 at amazon,” or three deals for different gas stations right now. Bring on those rewards.

beet hummus (#946)

Yeah I definitely have the Mint syndrome (those budget bars get SO ANGRY at you).

I don’t use my credit card for daily stuff, I use my debit card so that I feel the pain more immediately. And then I try to pay off my credit debt every month, but I don’t always succeed.

Everyone seems to have rewards cards, and I’ve always been super skeptical of them. I’d rather just have a no-frills card with a 11.99% interest rate that doesn’t encourage me to spend. Am I doing it “wrong”?

andnowlights (#2,902)

@beet hummus I don’t think you’re doing it wrong at all if it’s something you’re not comfortable with! I didn’t have a rewards card for a long time and I honestly can’t even remember how we ended up with one. The cash back is nice but it’s not a huge amount- maybe $25 a month? Sometimes I wonder if it’s even worth it, but then I get to go spend that money on something fun for myself and I think I would miss that more than I worry about using a credit card for everything.

thejacqueline (#799)

@OllyOlly I’m the same way. Cash is cash, once it’s out, it doesn’t matter. I put everything on my credit card and keep an eye on that balance, and then pay it off every month. Also by summer I’ll have enough points for a free flight to basically anywhere on Earth, so its worth it!

I would like to be saving more though, so I think I’m going to redirect some cash to a second debit card (Charles Schwab for sure, no ATM fees) so I have a monthly cash limit on top of my (varying) credit limit.

beet hummus (#946)

True! Thanks.
I think about it lately because I did a lot of air travel in 2013 and will be doing more in the coming year, so I just wonder how many free flights I’d have by now if I’d signed up for a Delta card years ago. Oh well.

Charles Schwab is the shit, do it!!

@OllyOlly I have an Amex credit card I use a ton, and since it’s not a charge card there’s no annual fee *and* I still get the aforementioned discounts like the Amazon one which I totally used this week. The rewards are good too: 7500 points for $100 worth of statement credits. I pay it off in full every month and I feel like I’m getting free stuff from Amex, which I am OK with.

gl (#5,458)

@OllyOlly Cash definitely seems like fake money to me and I don’t even use Mint! (Though I did keep track of all my spending for several years in my own little color coded spreadsheet, which was really useful for me in terms of seeing where my money was going and giving me a good sense of how much I needed to bring in each month to live the lifestyle I wanted, so maybe that gave me fake!mint syndrome???) But I think it’s actually because, as you said, the cash is gone from my account so I don’t think of it as being earmarked for anything special anymore. Plus I use cash for “throwaway” purchases like lattes and paying friends back for drinks or dinner, and my cc is used for “real” purchases like my monthly metro card, my phone bill, and groceries.

Playing the credit card rewards game is too exhusting to me — sort of like cutting coupons — so I don’t. I just have one cc and I’ve had it for ten years. I pay off the balance each month with an auto withdrawal and I check my statements online every month or two to make sure they are pretty much in line with what I expect.

garli (#4,150)

@OllyOlly Oh I feel you on mint syndrome. Those red bars guilt me better than my Jewish grandma.

andnowlights (#2,902)

We use our card for everything except our rent, car insurance, and electric bill because those three places won’t take credit cards! Oh, and student loans. Some places don’t take AmEx or Visa as credit cards, so occasionally I have to use my debit card but mostly everything is on credit til the end of the month I pay it off on the last day of the month, religiously, and it makes me INSANE when a pending charge hasn’t gone through yet and I have to make a second payment a day later. It’s just easier for me this way and I keep a spreadsheet that has every expense listed on it as I make it.

Cash back is fun and it’s my “play money” for keeping track of all our finances.

EA_Mann (#5,000)

I have the same mint issue. Since it doesn’t know how to categorize cash wishdrawn from ATMs, that cash is almost like money laundering. I can spend it on whatever junk I want and mint has no idea!

beet hummus (#946)

When I’m feeling ambitious I split my cash withdrawal transactions and recategorize them, but mostly I like outsmarting Mint.

a27 (#2,268)

@EA_Mann I put them under “uncategorized” and then “cash and atm” and i allow myself a certain amount of fun cash money per month, but then the red bar gets me if i take out too much!

I must be the only 28 year old in the world to still use mostly cash. I mean, I’m sort of irrationally old fashioned in some ways and trust the countability of cash. but also, I make most of my daily income teaching piano or playing for people, and a lot of them pay in cash. So it’s just a really clear way for me to see how much of what I make I’m spending. It’s just easier and makes me think a lot more about the purchases I make.

moreadventurous (#4,956)

@oatmealshrapnel I think that’s totally reasonable. When I was making tips, I got used to spending cash almost exclusively and it’s engrained in how I think of money now.

aetataureate (#1,310)

@oatmealshrapnel I’m 28 and have never had a credit card, so I’m not far from you.

chic noir (#713)

@oatmealshrapnel – Me too. Cash is for small purchases.

@aetataureate- You are a smart lady. I like to avoid temptation too.

Liz the Lemur (#3,125)

I also feel like cash is “fake money.” It’s already out of my bank account – who cares what it gets spent on!

I have two credit cards. One that I never use and should really cancel, and a rewards card that I rarely use. I’m still terrified of credit cards, even though I know that I could be earning all sorts of rewards etc. if I used it. I even have auto-pay set up for the misc. $40 or so that I put on my credit card every month.

Beans (#1,111)

My credit cards = online purchases. That’s it.

moreadventurous (#4,956)

I just got my credit card! As in, haven’t even gotten a bill yet. In my mind, I will use it for gas and groceries and pay it off every month. I’m way more comfortable using cash when going out to eat / drink, probably because that’s where my money mostly goes to and I don’t really want to know what it adds up to. I tend to use my debit card for clothes or like… Target stuff.

scn231 (#1,705)

I have… nine credit cards. None of which I carry a balance on, but I got my credit score into truly stellar shape a couple years ago and started getting offers on credit cards that are really good – I don’t think the cash back is that amazing, but signup bonuses are awesome, for example, signing up for Chase Sapphire got me $500 in travel, and recently the United Mileage card got me a $100 round trip to Paris (also, long distance relationship). Etc. Nerdwallet does roundups of good offers, but the even better ones come from signing up for whatever airline’s email lists and waiting for them to give you a special deal.

@scn231 I’m in about the same boat. I used to have terrible credit, but now it’s not so bad/maybe even good and I’ve been taking advantage of offers like Chase Sapphire.. But what is all this about a card with a $100 ticket to Paris? Do tell!

scn231 (#1,705)

@May LaDouceur@facebook Sorry I just saw this! That one is the United Mileage one – sign up for their mileage plus account, and then wait for them to email you the 50,000 bonus points offer for the mileage plus explorer card. Don’t settle for less! 50,000 was enough to get a round trip flight, plus I think $90 on my own tab. I’m flying in february, but they claim: “Use your miles to book any seat, any time — no limitations, restrictions or blackout dates.” (I don’t totally believe that, but I was very impressed with the flight results.) There was also a first class flight to new orleans for (one way) for jazz fest weekend, which is usually super expensive, for 24,000 miles. I also got the umm Barclays Arrival card recently, which is sort of weird because it uses the bonus points to reimburse you for past travel expenses. Still a very good deal (40,000 bonus points), but less exciting than blowing all your points on a big trip.

Allison (#4,509)

I have three credit cards, but I almost typed ‘one’ because I only ever use one (capital one venture card.) I figure if I’m going to spend money, I’m going to get that 2% for travel which I do a lot of. I don’t think I’ve ever paid interest on it in the 18 months I’ve had it.

I am sad they got rid of their earn extra by shopping online (or in person at Trader Joe’s) because I was so good at that. But that’s what rapid rewards shopping is for. I am working every system I can so that I don’t have to pay every time I want to go home.

jfruh (#161)

I use my credit card as a one-month float loan for big purchases, and I put as many recurring bills as I can on it (though I refuse to do this with bills like my utility bills, which charge you a fee for using a credit card, on principle). I recently switched to a B of A Rewards car that gives you 3% back on gas and 2% on groceries so those definitely go on the card. Everything is meticulously tracked in Quicken so I know how big my balance is and I pay off the complete bill each month. However, one thing that I think is interesting is that the closing date on my account is usually the 2nd or 3rd but you have a month to pay it off without penality; I pay my credit card in my mid-month bill pay session on the 16th or 17th, which means that I’ve accumulated another two weeks of charges at that point. The upshot is that I never actually pay my balance down to zero, and in fact I rarely have less than $1,000 charged to the card, but I also never pay any interest.

deepomega (#22)

@jfruh You should check the math – I was on a 3%/2% card, then switched to the upgraded Amex. 6% gas, 4% groceries, 2% everywhere else, for $75/year. We EASILY clear the cost on points.

Ellie (#62)

I guess I’m spoiled by financial solvency or a natural ability to live within my means or something but the idea of buying things for fun (like meals out or clothes or vacations) that you literally don’t have the money for at the moment seems absolutely psychotic to me, like, beyond comprehensibility. I have done that exactly once, when I was studying abroad in Europe, had spent most of my money on travel and got invited to a wedding over Labor Day weekend, so I used my credit card to buy a plane ticket there.
I’m seriously thinking about getting an airline rewards credit card, but otherwise I am pretty happy using debit. I know that if you get a rewards card then you can get, you know, rewards, and I could just use my credit card and pay it off in full every month from my checking account, but the whole idea of having to pay it off seems like an unnecessary extra step to me and I really enjoy tracking all my purchases on the website of my local bank. So I think that I value my time and peace of mind more than a couple hundred a year.

franklina (#3,924)

@Ellie Agreed. I’m really struggling to comprehend too.

Though I use my credit card like a debit card, trading the extra step of having to pay it off for the enhanced consumer protection.

WayDownSouth (#3,431)

My wife and I each have two credit cards. I like using them because the purchases are easier to track in Quicken than cash. The credit cards are paid off each fortnight. I hate, hate paying interest.

I have a credit card with Amazon Rewards which is awesome because every once in a while those points come in handy. Like now, for Christmas presents. I use that card for everything and pay off the balance every month. I haven’t carried or used my debit card in years.

I also have 2 store credit cards that have rewards. One is for a clothing store I used to work at which meant that I got little extra discounts and coupons. The other one is an Angels card that I opened when I had a bra emergency at work.

jquick (#3,730)

I have 2 cards for points or $ back. Pay each one off every month.

kellyography (#250)

I feel dumb for not having a rewards card, but I have only ever had one credit card, from Capital One, which is the only card to ever approve me. I don’t really know why, either – I paid off my student loans and have never carried a balance on it. I use it as an extension of my debit card (especially for online shopping) and pay it off every month. I will say that I don’t like the idea of having to pay a fee to have a credit card. Where are all the great no-fee rewards cards?

Goodie (#5,447)

@kellyography My credit card has a fee, but every year when the fee is due I just call up and say I want to cancel the card as I cant afford the fee, they always remove it or give me a real discount on it to keep my business.

Beaks (#3,488)

@kellyography I feel like my Capitol One card is a no fee rewards card? I get 1% cash back, which they will auto-credit in $25 increments. I recently found out I can also donate my rewards dollars to charity, so now I just use the rewards for that.

(I have also requested a copy of my cards terms and fees since I just realized I’m only about 85% sure it’s a no-fee card…)

Allison (#4,509)

@kellyography nerdwallet.com is a great resource for comparing all the different kinds of cards.

Goodie (#5,447)

I have 3 credit cards, 1 that I never use and should cancel, 1 Ionly use when travelling verseas as it has no foreign transaction fees and the last one which I use for everything that doesnt charge me a fee for using a credit card. I use this one for evrything as its a reward card and it allows me to go on holidays for free which I love. I pay it off every week (even though I get paid monthly) as I find it easier to track my money that way. I got my first credit card 8 years ago and have never paid interest on them.

Goodie (#5,447)

@kellyography My credit card has a fee, but every year when the fee is due I just call up and say I want to cancel the card as I cant afford the fee, they always remove it or give me a real discount on it to keep my business.

Caitlin with a C (#3,578)

I have two fee-free rewards cards (Discover, and a slightly-less-rewarding Visa for places that won’t accept Discover). I use them for everything, for I too have “Mint syndrome”. I just don’t carry cash at all anymore — I have a fee-free ATM near my office that dispenses in $10 amounts, so I do that whenever I need it for something.

Unless I get hit by something really bad and expensive (JUST finished paying off something like that a few months back), I pay off my credit cards every time I get paid (~2x per month). Hate holding a balance.

echolikebells (#3,272)

Everyone is so much more responsible than me! I have two credit cards, both of which I use as my “emergency funds” since I haven’t been able to save up to one yet and also for larger purchases that are not strictly emergencies but I don’t have money for the lump sum (springs broke in my old mattress, so I needed a new one, all of my Christmas shopping). Not great ways, but I’m trying very earnestly and very quickly to get things under control.

stonetongue (#3,580)

The BillFold, a personal finance blog for young people, runs advertisements for Discover now?

lemonadefish (#3,296)

We have a joint credit card that gets cash back, where we charge everything – groceries, some bills, house things, etc. We each have an Amazon rewards card for our fun spending. And I have a Target card for the 5% discount. They all get paid off every month. Sometimes I make a payment twice a month just to make sure I don’t forget. Once in a great while, we don’t have enough in the checking account to pay the whole joint CC bill at once, and then I freak out, and try to make my husband freak out and don’t allow us to buy anything for a while, and then it is fine the next month.

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