Car Rental and Credit Cards

Keep a credit card available for travel. It is not only required for some things, but it is increasingly necessary for the following: 1. Car rentals = it acts as a guarantee (damages, charges, etc.). Deposits are becoming dodo birds: the liability amounts are too high (ie deductibles), hence too risky to keep the cash or to accept personal cheques. 2. Hotels = used against first night charge + guarantee (even though on arrival you may be able to pay with cash) 3. Any online ticketing - train, flights, events, entrance fees, tours, etc. The trend for credit card use required for hotel bookings and online ticketing is dramatically increasing. If you keep a budget, the credit card will not be the cause of debt.
If you only use the card for the purpose you need it for, it will not cause debt. On the contrary, a credit card for travel will save you money: a) You will have more booking choices open to you, especially for accommodations. b) it will even offer you some limited protection for the money you spend (like for deposits, fraudulent services, etc.). c) Prices for many things booked online are often MUCH cheaper when paid for in advance. For example, a train ticket can easily cost 50-75% less if bought online, versus walking up to a counter to buy. Keep a credit card for travel and choose it wisely - one which offers some travel insurance would be a good bet.

Owning a credit card and being debt free does not have to be mutually exclusive if you use your cc responsibly. Aim at paying of your bill every month. Credit card companies don't like customers that do that as they don't make any money of them but that's how I've always operated ;-) And travel is one area where it can be used very responsibly without creating further debt. Especially if used to replace large sums of cash that would be required as security deposits otherwise. Diane's tips in that regard are really great.

If you get a regular Amex card (not the delta one) you have to pay it off every month, plus you get miles for travel on any airlines for all purchases. More for some. Yes, there is a fee, but I use it for everything and just used my points for a 1900 flight to Turkey...no interest because you pay it off.

I'm retired. I have credit cards. I have no debt. None are mutually exclusive.

The only problem with Am Exp is that it is not widely accepted in
Europe or even in the US. And personally I don't understand the linkage between no credit cards and debt free. A cc is a tool that you use to your financial advantage.

Personally, I don't want credit cards. I don't like the way the Credit Card companies are treating people and I choose not to have one at this time. I do have a debit card however and use it extensively.

That's right about Amex not being accepted everywhere. I have backups, but most things that you book online here through booking agents or rental cars do take it...and more places in Europe all the time, especially since Delta is probably pushing it, since that is their frequent flyer credit card. I don't think you should ever travel with one... sometimes your card may be blocked and then it is a pain to get to the right person to find out the problem.

Rhonda... understand the negative feelings towards credit cards... I agree, but since I choose to travel I find I have to have one. You can use a debit card for a few rental companies, but they will put a huge hold on your card. Last trip to England I wanted to use debit card and they were going to hold 2000 on my card. With a debit card you are giving people the account number to your checking.... at least with a credit card they will fight for you...I took my checking account out of the bank and moved to credit union, but if I want to travel I don't know any other easy way without Credit card, so I take whatever benefits from them that I can (and the points do add up) and I don't pay any more than I have to. If you come up with a way to avoid giving the greedy banks more money let me know...I'm on board!

Not all credit card companies are the same. Choose financial institutions you like and carefully consider rates and fees vs. other cards. It's important for consumers to dump the crummy banks and choose better options - it keeps the credit card issuers honest. I once rented a car with only a cash deposit. I think that was the early '80s. Rental car companies are much more strict now, I wouldn't be able to do it today.

Rhonda, also keep in mind when you use your debit card internationally you WILL be charged foreign transaction fees--3% is common. That adds up. On the other hand, you can get a Capitol One credit card, which charges nothing for foreign transactions.