The DM has a article quoting Martin Lewis on debit cards.
‘Debit cards are now danger cards’: Martin Lewis issues urgent warning to regular debit users as consumer overdrafts now stand at 40% – ‘double’ a high street credit card
This is a highly misleading headline. What he is saying is that using overdrafts to fund borrowing is expensive, which is fair enough. Specifically, unauthorised overdrafts are eye wateringly expensive, but that’s nothing new. Debit cards are an irrelevance here because they are merely the means of accessing that borrowing. Of course, if you are buying online, using credit cards will give greater protections than debit cards, but that is not the subject being discussed.
His advice to consumers is to use balance transfers to shift expensive debts on to 0% interest credit cards instead of going into the overdraft.
This has always been his standard advice. However, credit card borrowing is also very expensive and shuffling money from one 0% deal to another is a rabbit hole, because revolving credit is a trap that just gets you deeper in. Sooner or later it will bite and bite hard.
The best response to this comes in the comments below the article.
The debit card isn’t dangerous. Spending money that you don’t have is
Quite.
Surely anyone awake realised the almost free credit bonanza of the last 15 years or more was going to an end, millions of people living champagne lifestyles on lemonade money, well it’s coming crashing down around their ears and the weeping of victimhood for believing they were celebrities all along is going to be loud.
Many had ample time to use cheap interest to work hard and pay that house off, nope got to have his n hers Audis on lease/rent deals to impress.
I’ve seen the devastation too closely when balancing multiple credit cars along with brand new cars none of which could be afforded cost a fine young man his life, which he took himself.
I effin well hate bloody financiers and sales and trend setting bods who prey on the weak minded into borrowing to live a lifestyle they don’t have the means for, may the fleas of a thousand camels infest their lives for enternity.
The bloody politicians too, they should be advising youngsters about the dangers of credit and debt, wouldn’t do any harm for the schools to replace warped deviant sexualising lessons with honest common sense financial and lifestyle learning instead, or does it suit the govt for people to be potless and up to their arse in debt that takes over their lives and makes them dependent.
Which leg would politicians stand on? What standing do they have to advise anybody on anything? They’re the worst culprits when it comes to spending money the country does not have. Unlike credit card borrowers, they don’t even have to pay it back because taxpayers will.
With negative interest rates and inflation for the last 12 years, there is an argument that debt was actually the smart way to spend. The mistake was to believe that it would last forever.
As the saying goes, what is unsustainable will not be sustained.
I’ve been hammering 0% credit cards this last year – with inflation running at 10+% and a pretty solid plan of how to clear the balance at the end of the 2 year promotion I’m quite enjoying the discount on everything I buy. As Tim has been known to point out, saving is simply deferred consumption now, whilst borrowing is sacrificing consumption in the future. If the costs of consuming now are cheaper in the future then happy days!
This plan does of course require a basic grasp and certain restraint on personal finance, which seems to be sorely lacking in the general population – and to Judd’s point, yes I have long wondered why kids aren’t taught this stuff at school; would seem far more useful than algebra or Shakespeare for the masses.
This moron does know that you can set your debit card to never overdraft, right? Mine gets declined for insufficient funds – it’s basically an ATM card. I have a separate credit card for running up debt and spending money I don’t have. Debit cards aren’t dangerous – morons are.
He’s become something of a guru in the UK media, yet what he says can be easily worked out by the average person using a bit of common sense.
Common sense isn’t that common.
Yes, I was a bit of a naive idiot regarding credit cards when I was much younger. I’ve learned my lesson though and nowadays I never spend on the credit card unless I have the funds to pay it off in full at the end of the month. The thing is though, when I found that I had stupidly run up more debt than I should have, I owned my mistakes. There was no one to blame but myself and I saw it as my responsibility to dig myself out of a hole of my own making.
I wish Martin Lewis would bugger off. He’s become nothing more than clickbait in the online media these days.
“Martin Lewis reveals something that we’re not going to state in the headline”
I don’t care
“The best response to this comes in the comments below the article.
“The debit card isn’t dangerous. Spending money that you don’t have is”
“Quite.”
A lot of people have already spent money they don’t have. I suspect this has happened ever since we invented money and probably before (e.g.”Give me a sack of grain and I’ll give you back two sacks of grain when my harvest comes in”). People will spend today and let tomorrow take care of itself. When tomorrow arrives they need a plan to get out of the mess. That’s what Martin Lewis is trying do, provide them with a plan. Telling people who have already spent next year’s pay that they shouldn’t have spent next year’s pay doesn’t solve their problem.