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Charge card vs Credit Card

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February 11, 2012 – Comments (11) | RELATED TICKERS: AXP , MA , V

I cannot wrap my head around why anybody would want a charge card, when they could just get a credit card.

I put everything on my credit card, and have never even paid one cent of interest.  I only spend on my credit card what I have in my bank account, I just use the credit card for rewards and credit building.  I pay off my full statement balance the day it comes in.

Charge cards have no limit: This is a lie.  Otherwise, I could go spend 5 trillion dollars.  Which they will not let you do.  There is a limit, they just don't say what it is.  This could work against you because you could be denied unexpectadly

People like charge cards because they cannot roll it over, and pay interest.  So, then you could just...you know, not do that.  Just use the credit card more responsibly.  Also, if you really are in a crunch and can't pay off the charge card, you will get hit with a heavy fee and possibly suspension of your card.

Charge cards tend to have high annual fees, credit cards dont.  Charge cards say they have premium rewards, but for every charge card with good rewards I can find you a credit card with better rewards.

So why would you use a charge card when you can use a credit card?

 

11 Comments – Post Your Own

#1) On February 11, 2012 at 9:26 PM, HarryCarysGhost (99.68) wrote:

What's a charge card.

Do you mean debit card?

Anyhow dos'nt matter to V as long as the swipe fees keep processing.

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#2) On February 11, 2012 at 9:56 PM, jwebbzor (< 20) wrote:

A charge card isn't very common, but it is different from both a credit and a debit card. Like V said, a charge card isn't supposed to have a limit:

http://en.wikipedia.org/wiki/Charge_card

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#3) On February 11, 2012 at 10:22 PM, Valyooo (99.41) wrote:

A charge card is what most of AXP's cards are.  A credit card, but you must pay it back at the end of the grace period.  It does not revolve.

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#4) On February 11, 2012 at 10:56 PM, HarryCarysGhost (99.68) wrote:

A charge card is what most of AXP's cards are.  A credit card, but you must pay it back at the end of the grace period.  It does not revolve.

So why would anybody want that... Oh wait that was your question.

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#5) On February 12, 2012 at 12:56 AM, Valyooo (99.41) wrote:

Right? I thought I was crazy because  a lot of people seemed to like them.  Makes no sense ot me at all.

 

If it is a mental reason (which is never a very good reason) then the no limit thing should work against you.

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#6) On February 12, 2012 at 10:29 AM, Momentum21 (82.23) wrote:

For the average AXP card (where the "status" of using it is nominal) you have a bit more flexibility with rewards programs. The points might have less value but you can use them on more things. 

I use mine because my company issues it. Therefore my limit can be higher and I can accrue more points than I might be able to on a standard credit card.

What is the most aggressive rewards program you know of? I might be inclined to switch if I found one that suited me but I am kind of lazy. The retailer cards don't seem like such a big deal to me...it just encourages you to buy something you might not need...

 

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#7) On February 12, 2012 at 10:32 AM, Momentum21 (82.23) wrote:

Here is a site I found with a quick Google Search with all the pros/cons:  http://www.nerdwallet.com/blog/top-credit-cards/nerdwallets-best-rewards-credit-cards/

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#8) On February 12, 2012 at 1:11 PM, tomlongrpv (76.63) wrote:

As an AXP card holder for over 25 years let me offer an explanation of why I like it.  It is essentially a charge card although you often can pay some charges over time or apply for and get a credit limit although the interest rates are not good and so I havce only very rarely used the credit liune.  It does build credit.  Most importantly, though, is that if you have a disputed charge, Amex will start with the assumption that you are right and will handle the dispute over the phone.  My experience with VISA and Mastercard has been different.  Both started with the assumption that the merchant is correct and both required me to send notarized written statements.  I got the same result in the end on both (I prevailed) but I had a lot more hassle with VISA and Mastercard.  In particular it took more time for both and in one case both my wife and I had to sign the notarized statement.  No thanks. 

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#9) On February 12, 2012 at 4:47 PM, Valyooo (99.41) wrote:

I have not had similiar experiences to you tom.  And the customer service has nothing to do with the model of the card itself, but yes amex does have good service.

 

Momentum, I find that chase has the best selection of credit cards for all different needs.

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#10) On February 12, 2012 at 6:01 PM, Mega (99.96) wrote:

Momentum21

If you're in the market for a new credit card, I think Citi Forward Visa and Fidelity Amex have the best cash rewards with no annual fee.

Citi Forward gives 5% cash back at Amazon and restaurants. Fidelity Amex gives 2% cash back everywhere.

I was using an Amazon Visa, but phased that out in favor of these 2 cards.

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#11) On February 12, 2012 at 9:09 PM, Momentum21 (82.23) wrote:

MegaShort (99.90) - thanks man...I will check em out...

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