Kat's Notebook » credit card

The birth of a credit card shopper

Katkat — Sun, 13 Sep 2009 16:08:06 +0000

I love to shop especially here in the USA where items are easily bought, exchanged, returned ,and refunded. Online shopping is easy too. Most of American retail stores have websites which make it very accessible and convenient to shop. No wasted gas money when you know which store carries the item you are looking for. Tandem with shopping is the use of credit cards. Consumers ready their cards to be swiped at the signal of the sales associate. Only a few here pay in cash.When they do, the sales associate becomes flustered because they don’t carry change.

However you can’t easily get credit cards. The card company actually needs the consumer to have a good credit history before they can issue the person a credit card. This has been my dilemma for the past 4 years. I really don’t like to apply for a credit card. I don’t like putting myself in debt. So I always use my parents’ credit card and pay them afterwards. When my bank introduces a debit card mastercard, I am impressed because now I can purchase online items with the mastercard feature in my debit card. However I get envious sometimes on those credit card users. They get free stuffs, discounted stuffs just because they have credit card especially when they have a retail store credit card. Whenever I shop, the cashier will ask me if I want to apply for the store’s credit card to avail of the extra 15-20% discount on all the items I have bought. Of course I’d like that! So I go through the process of applying for one right there in front of the cash registry only to find out that my application has not been approved because of lack of credit history. This goes on for 3 to 4 more times in different stores until I stopped trying and just forewarned the cashier that I don’t have credit history to be accepted.

My dad suddenly opens a joint credit card account with me. I have my first credit card finally! My dad says that I will be the only one to use and pay for that account. I am able to enjoy the reward points of using the credit card. Because of the reward points I find myself often using the card then later to discover that my billing statement is so high! After 2 months of being like this, I have become prudent on which cards to use. I switch from credit card to debit card or to cash. Then my dad terminates his other credit cards and decide to use this card he has with me. This presents a little problem of who’s going to pay what items.

When I return from the Philippines recently, I of course am in a shopping mode. I need to buy some essential skincare items. Having no cash in hand, I have taken liberty in using my credit card again! I have been looking for Clinique moisturizer and knowing that some stores give free items when purchasing a beauty product, I am drawn to Bloomingdale’s promo. Purchasing a Clinique item worth 21.50USD or more will entitle me to a beauty bag with 8 Clinique items in it. The sales associate starts ringing my item and she routinely asks if I have their credit card. I answer no and I immediately tell her that I cannot be approved for any credit card because of lack of credit history. She tells me that she’ll just try anyway, which I agreed.

It’s like winning a lottery or getting a surprise gift or getting to travel to an exotic beach. The sales associate inform me that I’ve been approved for a Bloomingdale’s credit card. Woot! But I immediately sober up and ask if there are any extra fees I should pay and she negatively answers. Coolness! With opening an account, I get to have 20% discount off my items and a special gift from Bloomingdale’s. So it has been a fantastic shopping day for me! I have bought 2 items and come out with 3 gifts, 20%off, and a new credit card! What more can a girl ask?

Wall Street Now

Katkat — Mon, 29 Sep 2008 20:24:31 +0000

Wall Street is in big chaos. The $700 billion government bailout plan was denied. Wachovia was bought by Citigroup. All stocks plunged down. So what happens now? Would major banks go bankrupt one at a time? My boss said when the banks go kaput, credit will freeze. So no one can borrow money or use their credit cards. That’s good for me, I guess. I won’t be able to use my credit card meaning more money saved (*wink*). But bad for the businesses. I wonder why the government didn’t save the financial institution? I don’t know exactly what’s in that bailout plan but wouldn’t it at least prevent the major decline of the economy? I know it’s the people’s money but where else could the government could have gotten the money to help the economy? The taxpayers’ money is saved for right now but what happens if there’s no improvement in the economy in the next few months/years? Would the taxpayer pay a steeper price? And why is it that with all the ongoings in the economy right now, the Bush administration is still continuing a war that should never happen? That’s just an unnecessary waste of financial resource.

Oh well….what do I know…just putting my naive two cents in.

Which Card To Use?

Katkat — Sun, 21 Sep 2008 03:06:53 +0000

I’ve never imagined that I would own so much cards in my wallet. To wit I have: 3 debit cards, 1 credit card, 3 shop member cards, driver’s license card, and 1 unused gift card. Some people have many more. I removed some of the cards that I don’t use that often so that my wallet can close well. I should remove my credit card so I won’t be able to spend too much. And the irony to it is I would unexpectedly need those cards I’ve just removed, grrr…

Here are the functions of some commonly-used cards and I sometimes need a moment to choose which card to use:

1. Credit card – very handy when you don’t have cash in hand and don’t want to carry too many cash. It earns reward points if you spend it but beware you might overspend…like me!

2. Member’s savings card – I have Safeway, Ulta and Sephora. It’s nice to become a member of such stores because they give you discount on their items and you get free alerts of upcoming sale events. Everytime you purchase, you earn points in the card. When you reach a certain amount of points, you actually get a gift. Membership is free. Costco however is different. You pay almost $50 for annual membership and they’re strict with it. You can’t shop in costco unless you have their card. I got away with it twice because it was the holidays so they didn’t look at the card diligently – they just swiped and charged. But they usually look in the member’s photo in the card (this is for costco american express card, I think).

3. ATM/Debit Cards – some debit cards function as a credit card. Usually debit cards can’t be used in stores where they only accept credit cards. But the debit card nowadays have VISA or Mastercard feature in them so you can use it as a “credit card”. Its difference with the credit card is your cash in the bank is automatically deducted when you use the debit card while in the credit card, you only pay after you receive the bill statement (I always get surprise to discover how high my credit card balance is…tsk tsk tsk….)

4. Retail store cards – eg. Old Navy, Macys, Nordstrom, Home Depot, Target etc…They all have their own cards. They entice customers by offering an extra 10-20% off discount on their purchase when they open a card. I’ve applied to numerous stores before but my application is always denied because of lack of credit history. My mom has a Macy’s Visa Card which I use to pay for my Macy’s purchases. I just write her a cheque when the Macy’s bill statement arrives. The benefits of having such cards is they give you discounts especially big stores like Macy’s, Nordstrom, Neiman Marcus (the downside of this is they’re not cheap stores and even with the discounts you still spend hundreds of dollars); they send you catalogs in the mail announcing their upcoming events and fashion and sales.

5. Gift cards – these are the best kind of gift. It’s just cash card which allows you freedom to buy anything in the store specified by the gift card. You don’t need to put on a fake smile when you receive this (unlike when receiving gifts you don’t like). Before, my dad received requests from our relatives in the Philippines to buy them Victoria’s Secret lotions/spray (the 5 for $30 sale they have). Because he has spent so much on Victoria’s Secret, VS actually regards him as a valued customer and mails him catalogs and gift cards with redeemable free VS panties. We just laugh when that VS card arrives. Of course I’m the lucky person who gets to redeem it!:)

When I return to the Philippines, the only cards I would be toting with me everyday are my student ID card and 1 ATM card. What a complete difference huh? Unfortunately in the Philippines, not all stores can accept credit cards and debit cards. So I actually need to bring lots of cash. Here’s an advice though: don’t put all your cash in your wallet; stash them in different places: your bag pockets, notebooks/organizer, jeans pockets, shoes!, underwear! because you may never know when bad luck will strike.

Credit card woes

Katkat — Sun, 07 Sep 2008 18:47:23 +0000

Here’s to one of my initiation to the adult world. Although I’m already 25, I should’ve known and must have been using this for a long time. I got my first credit card when my dad opened an account and joined my name with his card. I’ve always used a debit Mastercard where it functions as a credit card but when you use it, it automatically deducts money from your bank account. For me that works fine because I can monitor what I’m spending. But in the US, they apparently are looking for a credit history in order for you to be able to apply for loan for house or car or whatever. I thought using my Mastercard is working towards a credit history but nope, only credit cards can do that. So how am I going to establish a credit history if no credit card company wants to give me a card since they said that I don’t have enough credit history??? Geez that’s just going in cricles. So my dad solved the problem for me. Now I have a credit card and I’m spending like crazy!!!

For me the good things about credit card are: 1. it gives you an “advance money” when you really need to spend it on something; 2. there are reward points or cash back rewards when you use the card; 3. it establishes your credit history and a good history especially when you always pay your bills on time; 4. I don’t have to carry much cash with me; 5. it’s accepted everywhere (at least in the US) especially when you do online shopping.

But why do they say that majority of the Americans are in financial debts mostly related to credit card use? Well I think I’m beginning to find out. Because I have just had my card for over 2 months and I have spent more than my monthly budget allows. Credit cards, I believe, give you that mentality that you can buy anything as long as you’re holding that card. Worry about paying it comes later. I’m also attracted to their card beneift of earning cash rewards every time I use the card. So it actually denotes “keep on spending!” Using my card on gas purchases actually earns me 5 points a dollar spent. With the increase in fuel prices, that cashback reward is really helpful.

Right now I’m trying to curb my spending tendencies. Sometimes I am forced to use my debit mastercard again just to control the amount I’m going to pay in credit card. In addition to, I keep a daily record of what I spend and always calculate them if it’s going beyond my monthly budget. It’s a good thing I’m not earning a lot because more money makes you want to spend more.