As I’ve made the lifestyle shift to operating on a strictly cash basis, I’ve learned plenty about navigating through the world without a credit card.
Worried that you’ll miss out on great online deals because you don’t have/use a credit card?
The fact is, you CAN shop online without a credit card. The trick is, you need to have the cash to afford what you want to buy. (There’s always a catch, isn’t there?)
Here are a few options for safe online shopping… without a credit card.
Paypal is an internet service that allows you to make payments online. Ebay owns Paypal, so I consider it a solid and reputable . Aside from ebay, many other websites also accept Paypal for online purchases.
Paypal is basically an online bank account that is linked to your primary bankaccount(s). You transfer money from, for example, your checking account to your Paypal account, and then Paypal will release funds at your request to the online merchant(s) you do business with.
Unfortunately, Paypal has been targeted by phishing scammers who attempt to access customer bank accounts. If you get an email from Paypal that requests log-in information such as your password, NEVER give out that information! Don’t click on any links in Paypal emails, even if they seem legitimate. Always open a new tab/window and type in paypal’s web address.
VISA GIFT CARDS
These handy cards can be purchased in various denominations (such as $25, $50, $100) and used just like any gift card. But unlike a store gift card, they can be used anywhere that accepts Visa. They are especially handy for shopping online– they have the familiar 16-digit card number and expiration date. You are, of course, limited to the face value of the card. Remember that a giftcard is as good as cash, so protect it as such!
I buy all my college textbooks on Amazon.com (at a staggering discount), using pre-paid Visa giftcards. For just three of my classes, I saved almost $200 over the school bookstore!
You can also get a pre-paid Visa card from banks, credit unions, and other places such as Wal-Mart. You load money onto the card, and then it is available for purchases.
The reloadable Wal-Mart Money Card is a super alternative to the cards with fixed denominations, as I have recently posted here.
Still other bank-issued pre-paid Visa cards can be custom-imprinted with your name, and the activity on your card will appear on your credit report. There may be some extra consumer protection with this card, but I’ve had no problem using Visa giftcards.
With pre-paid Visa cards, you will usually pay a fee. A $50 card might cost you $53.95, for example, and a $100 card might cost $105.95. The $100 card is a slightly better value at $105.95, since two $50 cards would cost you $107.90.
Of course, always protect your Visa giftcards and keep them in a secure place– they’re as good as cash to anyone else who might find them.
Debit cards can be used for purchases on virtually any website. You enter your debit card information directly from the card, just like a credit card.
Your debit card is linked to your checking account, so you are of course limited to the amount of money you have in your account. Think about it: you would have to write a check to the credit card company (hopefully) at the end of the month anyway, so use your debit card and save yourself the extra work.
It’s important to know that debit cards are just as safe as credit cards, despite what the credit card merchants would like you to know.
Personal finance author Dave Ramsey has written some excellent articles about debit cards, such as:
The Basics of Your Debit Card
There are ways of living in the world without incurring credit card debt. Hurray for cash!
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