Should I get a credit card?

Seylan

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Nov 21, 2014
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156
Sorry if this seems like a weird question, but I really don't know if I should get one.
When I started university 4 years ago, I had a student account (FNB). I got my first job earlier this year (May), and switched to a cheque account. So far I have only been using my debit card for everything. I don't see a need for me to have a credit card at all. But, I heard some people say that it is important to build a good credit rating, which is necessary if I needed to take out a loan or finance a car (which I don't see myself needing to do in the foreseeable future). So far the only benefit I can see from getting a credit card is using it for ebucks, but the value of that is another story. I will be paying around an extra R100 per month to have the credit card. So should I just avoid the trouble?
 

UrBaN963

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Sorry if this seems like a weird question, but I really don't know if I should get one.
When I started university 4 years ago, I had a student account (FNB). I got my first job earlier this year (May), and switched to a cheque account. So far I have only been using my debit card for everything. I don't see a need for me to have a credit card at all. But, I heard some people say that it is important to build a good credit rating, which is necessary if I needed to take out a loan or finance a car (which I don't see myself needing to do in the foreseeable future). So far the only benefit I can see from getting a credit card is using it for ebucks, but the value of that is another story. I will be paying around an extra R100 per month to have the credit card. So should I just avoid the trouble?

Avoid if you can. Rather get a phone contract or clothing account.
 

ToxicBunny

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Apr 8, 2006
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94,751
Sorry if this seems like a weird question, but I really don't know if I should get one.
When I started university 4 years ago, I had a student account (FNB). I got my first job earlier this year (May), and switched to a cheque account. So far I have only been using my debit card for everything. I don't see a need for me to have a credit card at all. But, I heard some people say that it is important to build a good credit rating, which is necessary if I needed to take out a loan or finance a car (which I don't see myself needing to do in the foreseeable future). So far the only benefit I can see from getting a credit card is using it for ebucks, but the value of that is another story. I will be paying around an extra R100 per month to have the credit card. So should I just avoid the trouble?

If you don't need it, then don't get it...

Insurance policy will help with your credit rating, as will a phone contract.
 

Snyper564

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Oct 1, 2008
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8,272
Don't avoid. Use it properly. I buy all my groceries etc on it earn my ebucks build a credit rating and settle at the end of the month. Ppl who can handle credit shouldn't get it but if you use it as if you had the cash and settle every month its a good idea.
 

wtg

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Sep 17, 2013
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478
A credit card is good if you have the discipline to pay it off before it accrues interest.
Also, with FNB you will be rewarded with more eBucks when you have a cheq and credit card - which enables the additional cost to be offset with the right spending behaviours.

Lastly, get one clothing account as well if you need to up your credit rating. Truworths and a few others has a 6 month interest free account. Yet again, only do this if you have good discipline.
 

airborne

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Jul 13, 2007
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Yes preferably an FNB card for the ebucks. Do all spending on the credit to take full advantage of the 55 days interest free credit, whilst leaving your money in a high yield interest bearing account. Then settle your credit card in full on the last due date, which is not the end of the month but on the 25th of the next month(ie the full 55 days), this can be automatically setup.

Never spend money you don't have, ie don't see the credit card as credit but just a different way to spend money you already have or are guaranteed to receive in the near future, ie your pay cheque.

If you do that you will profit from your credit card.
 

Snyper564

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Yes preferably an FNB card for the ebucks. Do all spending on the credit to take full advantage of the 55 days interest free credit, whilst leaving your money in a high yield interest bearing account. Then settle your credit card in full on the last due date, which is not the end of the month but on the 25th of the next month(ie the full 55 days), this can be automatically setup.

Never spend money you don't have, ie don't see the credit card as credit but just a different way to spend money you already have or are guaranteed to receive in the near future, ie your pay cheque.

If you do that you will profit from your credit card.
This is good. But. I would recommend against the 55days non payment. Its easier to settle on a monthly basis. Its more a mind over matter thing but if you are strict you can do 55days. Just be very strict and don't incur interest
 

airborne

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This is good. But. I would recommend against the 55days non payment. Its easier to settle on a monthly basis. Its more a mind over matter thing but if you are strict you can do 55days. Just be very strict and don't incur interest

No it's easy to utilise the full 55days, go to your online banking credit card settings and there's a payment tab, you specify the 25th and full outstanding(I'm not sure ethe exact term bit it's the one which settles the full amount owing from the previous months statement and hence without incurring any interest) and done. It gets done automatically every month from then on, I have not paid a single cent of interest and I get to take advantage of the full 55days every month.

You of all people should be doing this!!
 

Snyper564

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No it's easy to utilise the full 55days, go to your online banking credit card settings and there's a payment tab, you specify the 25th and full outstanding(I'm not sure ethe exact term bit it's the one which settles the full amount owing from the previous months statement and hence without incurring any interest) and done. It gets done automatically every month from then on, I have not paid a single cent of interest and I get to take advantage of the full 55days every month.

You of all people should be doing this!!
Hehe I have other more beneficial things believe me :) this has nothing on that. But as a person just using credit for the first time with a limit of R10k for example maxing it over two months might seem like a hell of a payment.
its all discipline at the end of the day.
 

Tomtomtom

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So far the only benefit I can see from getting a credit card is using it for ebucks, but the value of that is another story. I will be paying around an extra R100 per month to have the credit card. So should I just avoid the trouble?

For me the benefit is the security and convenience of having an internationally-accepted payment method that involves spending the banks' money, and so is protected by the chargeback system. The liquidity is also very helpful. It allows you to put your income to work (earning interest) immediately and not have to worry about inter-account transfers more than once a month.

If you get the cheapest card possible, and never owe interest, then it should cost roughly nothing. e.g. at R48/month, if you spend ~R7k, and have your R7k payment waiting in a 7%-interest-bearing account the whole cycle, then the fee is balanced.

Basically if you're prepared to "secure" for yourself the unsecured credit and learn to use the card "properly", I think you'll be glad you have it.
 

mushroom

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Apr 23, 2013
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I think the idee is kwai for the credit card coz you dont evans have to pay all the skuld you just make the payment then you can use the money that you did pay in again
 

GoB

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I have been harassed by my bank to switch to a cheque account and their logic has never made sense - always higher fees for what I'm doing.

So I'm probably the 1 in 1000 who has stuck to a savings account for 20 years.

Just saying... calculate for yourself, don't listen to the 'credit record' nonsense.
 

rietrot

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A credit card is for extreme emergencies and car rental. It's good to have if you are financially disaplined. It is one of the worst things for someone who isn't.
 

Snyper564

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I have been harassed by my bank to switch to a cheque account and their logic has never made sense - always higher fees for what I'm doing.

So I'm probably the 1 in 1000 who has stuck to a savings account for 20 years.

Just saying... calculate for yourself, don't listen to the 'credit record' nonsense.

When I take home R1k plus each month for ebucks on items I need to spend money on anyway I will gladly be the other 999 and take the prime -1 on a home loan at 27 because of my good credit record...

Its all about discipline. If I can make money from spending money I have to anyway why wouldn't you?
 

Cius

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I have never had a credit card, never saw the need. Once I started working I switched to checque account. For my homeload I had a cell contract and nothing else really and it was plenty. Got my bond no issue.

I know a lot of people who end up getting trapped by the credit card, hence I rather avoid the temptation.
 

GoB

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When I take home R1k plus each month for ebucks on items I need to spend money on anyway I will gladly be the other 999 and take the prime -1 on a home loan at 27 because of my good credit record...

Its all about discipline. If I can make money from spending money I have to anyway why wouldn't you?

I only mentioned cheque vs savings - nothing about ebucks or credit card. Between myself and my wife we have 2x bank accounts and 3x credit cards to maximise savings - also about R1k on ebucks. We got prime -1.5 and I don't know what it's based on.
 

airborne

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Hehe I have other more beneficial things believe me :) this has nothing on that. But as a person just using credit for the first time with a limit of R10k for example maxing it over two months might seem like a hell of a payment.
its all discipline at the end of the day.

You aren't maxing anything and you are only ever paying off the previous months spend on the 25th, never 2 months in one go. Your money is kept safe earning interest while you spend the banks money, there is no downside unless the op struggles with basic maths.
 

Snyper564

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You aren't maxing anything and you are only ever paying off the previous months spend on the 25th, never 2 months in one go. Your money is kept safe earning interest while you spend the banks money, there is no downside unless the op struggles with basic maths.
Its a point of view, if you have never had credit before owing 2 months worth of payments is daunting that's all I'm saying esp if you don't keep that aside etc. :)
 
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