1 00:00:00,040 --> 00:00:02,560 Speaker 1: Let's say good morning now too, the host of how 2 00:00:02,600 --> 00:00:04,480 Speaker 1: to Money at KFI. It's Joel lars Guard. 3 00:00:04,400 --> 00:00:05,880 Speaker 2: Morning, Jewel Morning Amy. 4 00:00:05,920 --> 00:00:08,039 Speaker 1: Okay, so we didn't get to this one last week, 5 00:00:08,119 --> 00:00:12,399 Speaker 1: so we're circling back. A lot of young people are 6 00:00:12,680 --> 00:00:16,840 Speaker 1: ditching credit cards in favor of debit cards. And on 7 00:00:16,880 --> 00:00:18,800 Speaker 1: the surface, that seems like a good thing, because you're 8 00:00:18,840 --> 00:00:22,479 Speaker 1: only using money you already have. Right below the surface, 9 00:00:22,520 --> 00:00:24,400 Speaker 1: it might not be such a great idea. 10 00:00:24,640 --> 00:00:28,680 Speaker 2: Yeah, so I think people would probably assume that I'm 11 00:00:28,720 --> 00:00:32,400 Speaker 2: a big fan of debit cards, right, Yeah, it's coming directly, yeah, 12 00:00:32,400 --> 00:00:35,159 Speaker 2: that it coming directly out of your account. And in 13 00:00:35,200 --> 00:00:37,879 Speaker 2: some cases I get it, like because when you look 14 00:00:37,880 --> 00:00:40,720 Speaker 2: at the statistics about credit cards, something like forty seven 15 00:00:40,840 --> 00:00:44,159 Speaker 2: percent of Americans have a recurring credit card balance. And 16 00:00:44,200 --> 00:00:47,640 Speaker 2: if you can't use your credit card in the ways 17 00:00:48,600 --> 00:00:51,560 Speaker 2: that I prescribe, which is essentially to only buy things 18 00:00:51,560 --> 00:00:54,880 Speaker 2: you would otherwise purchase and to pay that balance off 19 00:00:54,960 --> 00:00:57,800 Speaker 2: on time and in full every single month, then yeah, 20 00:00:57,840 --> 00:01:01,520 Speaker 2: you probably are better off going into If the debit 21 00:01:01,520 --> 00:01:03,520 Speaker 2: card is the thing that allows you to keep the 22 00:01:03,560 --> 00:01:05,759 Speaker 2: train on the rails, then go with a debit card. 23 00:01:05,760 --> 00:01:09,119 Speaker 2: But the truth is there are some downsides to using 24 00:01:09,160 --> 00:01:13,000 Speaker 2: a debit card right, and so like, for instance, you 25 00:01:13,000 --> 00:01:14,760 Speaker 2: don't get the rewards right that you would get with 26 00:01:15,240 --> 00:01:17,039 Speaker 2: a credit card, so you don't get that. I think 27 00:01:17,040 --> 00:01:19,560 Speaker 2: there's a couple of debit cards that have minor rewards, 28 00:01:19,640 --> 00:01:21,720 Speaker 2: but most of the time you only get rewards when 29 00:01:21,760 --> 00:01:24,880 Speaker 2: you're actually using a credit card, So pay attention to that. 30 00:01:24,959 --> 00:01:27,360 Speaker 2: The other thing is if someone were to take your 31 00:01:27,400 --> 00:01:30,000 Speaker 2: debit card and use it in a way right, steal 32 00:01:30,040 --> 00:01:34,280 Speaker 2: it and use it without your knowledge, then you could 33 00:01:34,280 --> 00:01:36,920 Speaker 2: be held liable for some of those purchases, whereas with 34 00:01:36,920 --> 00:01:39,760 Speaker 2: a credit card you're not. And also you're trying to 35 00:01:39,760 --> 00:01:42,120 Speaker 2: claw back your own money. Right if someone makes a 36 00:01:42,160 --> 00:01:45,520 Speaker 2: purchase with a debit card in your name, that wasn't 37 00:01:45,760 --> 00:01:47,520 Speaker 2: what it wasn't you like, you're trying to claw back 38 00:01:47,520 --> 00:01:49,760 Speaker 2: your own money, whereas with the credit card company, you're 39 00:01:49,800 --> 00:01:52,720 Speaker 2: just disputing a transaction. You're not out any actual money yet. 40 00:01:52,720 --> 00:01:54,560 Speaker 2: The other last thing I want to say on this 41 00:01:54,600 --> 00:01:58,720 Speaker 2: too is credit scores. They matter so much right in 42 00:01:58,840 --> 00:02:02,360 Speaker 2: our society today, and when you ditch credit cards in 43 00:02:02,360 --> 00:02:05,080 Speaker 2: favor of debit cards, you're paying less attention. You're not 44 00:02:05,160 --> 00:02:07,800 Speaker 2: building your credit score. In the same way. Granted, there's 45 00:02:07,800 --> 00:02:09,560 Speaker 2: a lot of people hurting their credit scores by the 46 00:02:09,600 --> 00:02:12,480 Speaker 2: way they handle credit cards, but it's just another thing 47 00:02:12,520 --> 00:02:14,840 Speaker 2: to note is that debit cards can be okay. They 48 00:02:14,840 --> 00:02:17,600 Speaker 2: can be a helpful tool to avoid some of the 49 00:02:17,600 --> 00:02:20,760 Speaker 2: pitfalls that credit cards pose, but also there's some downsides 50 00:02:20,760 --> 00:02:21,600 Speaker 2: that you need to be aware of. 51 00:02:22,040 --> 00:02:25,520 Speaker 1: Okay, So just investigate and then, like you said, if 52 00:02:25,520 --> 00:02:29,040 Speaker 1: you do get a credit card and you are using it, 53 00:02:29,080 --> 00:02:31,160 Speaker 1: be very careful and make sure you are able to 54 00:02:31,200 --> 00:02:32,160 Speaker 1: pay it off every month. 55 00:02:32,520 --> 00:02:34,480 Speaker 2: Yeah, I mean in that there was a survey and 56 00:02:34,520 --> 00:02:37,079 Speaker 2: it said something like forty three percent of people who 57 00:02:37,160 --> 00:02:39,200 Speaker 2: use debit cards they think that's helping them build their 58 00:02:39,240 --> 00:02:41,760 Speaker 2: credit score, and it's just not true. And so if 59 00:02:41,800 --> 00:02:43,880 Speaker 2: you believe something that's not true and you're assuming that, oh, 60 00:02:43,919 --> 00:02:45,799 Speaker 2: this was that's okay, Oh my credit score will still 61 00:02:45,800 --> 00:02:48,360 Speaker 2: be fine. Maybe maybe not, Like it depends on what 62 00:02:48,400 --> 00:02:50,360 Speaker 2: other sorts of lines of credit you have access to 63 00:02:50,400 --> 00:02:53,000 Speaker 2: and how you're using those. And that's why if you're like, 64 00:02:53,200 --> 00:02:55,080 Speaker 2: I don't know, man, I'm afraid of credit cards. I 65 00:02:55,080 --> 00:02:57,799 Speaker 2: haven't used them responsibly in the past, maybe you can 66 00:02:57,800 --> 00:03:01,280 Speaker 2: come up with a way to to say all right, listen, 67 00:03:01,320 --> 00:03:03,320 Speaker 2: I'm gonna have this one credit card that pays the 68 00:03:03,320 --> 00:03:05,799 Speaker 2: Netflix bill every month. That's all I use it for. 69 00:03:06,040 --> 00:03:08,200 Speaker 2: I don't have it on autofill on any of the websites. 70 00:03:08,200 --> 00:03:10,440 Speaker 2: I don't keep it in my wallet. It's literally just 71 00:03:10,520 --> 00:03:13,600 Speaker 2: on auto pay for Netflix. That even just that right 72 00:03:13,680 --> 00:03:16,560 Speaker 2: can help you build a credit score, can keep your 73 00:03:16,600 --> 00:03:20,600 Speaker 2: credit card usage alive without you feeling, hopefully the poll 74 00:03:20,680 --> 00:03:22,200 Speaker 2: to use it in a way that's in your own 75 00:03:22,240 --> 00:03:23,240 Speaker 2: worst interest. 76 00:03:23,280 --> 00:03:26,079 Speaker 1: Right, And I think that's important too, like sys, as 77 00:03:26,120 --> 00:03:30,280 Speaker 1: your kids are starting to build their credit scos, they 78 00:03:30,360 --> 00:03:33,120 Speaker 1: need to create good habits. But just you don't start 79 00:03:33,120 --> 00:03:35,400 Speaker 1: out with an eight hundred score, do you. 80 00:03:35,400 --> 00:03:37,760 Speaker 2: No, Well, here's the thing too. Actually, I love that 81 00:03:37,800 --> 00:03:40,880 Speaker 2: you mentioned kids, because there are ways to add your 82 00:03:40,960 --> 00:03:43,560 Speaker 2: kids if you are a good user of credit. By 83 00:03:43,600 --> 00:03:45,280 Speaker 2: the way, that's really important to note. If you use 84 00:03:45,320 --> 00:03:47,200 Speaker 2: credit well and you have a good credit score, you 85 00:03:47,200 --> 00:03:49,320 Speaker 2: can help your kids establish a great credit score by 86 00:03:49,360 --> 00:03:52,440 Speaker 2: putting them as an authorized user on your credit cards, 87 00:03:52,440 --> 00:03:54,600 Speaker 2: but not giving them access to that credit cards. So 88 00:03:54,640 --> 00:03:57,560 Speaker 2: then your kid graduates high school, goes to college, and 89 00:03:57,600 --> 00:03:59,880 Speaker 2: they start off with an excellent score instead of trying 90 00:04:00,080 --> 00:04:03,040 Speaker 2: to from scratch begin their own credit journey. So I 91 00:04:03,040 --> 00:04:05,040 Speaker 2: think that's a really good way to help your kid, 92 00:04:05,360 --> 00:04:07,200 Speaker 2: not giving them money, but giving them a leg up 93 00:04:07,200 --> 00:04:08,040 Speaker 2: in the credit space. 94 00:04:08,200 --> 00:04:11,320 Speaker 1: Okay, I want to talk about brands. We were talking 95 00:04:11,320 --> 00:04:17,159 Speaker 1: about Pavilion's Safeway select or select whatever. I don't know 96 00:04:17,200 --> 00:04:18,880 Speaker 1: what it's called, but I like it and I use it, 97 00:04:18,880 --> 00:04:21,719 Speaker 1: and I love their pizzas. And you're saying that store 98 00:04:21,760 --> 00:04:24,360 Speaker 1: brands are cheaper and they're pretty decent. 99 00:04:24,400 --> 00:04:27,320 Speaker 2: Now, yeah, I mean when you think back to twenty 100 00:04:27,400 --> 00:04:29,279 Speaker 2: years ago. I was talking with a friend recently and 101 00:04:29,320 --> 00:04:31,920 Speaker 2: he was talking about how how great the store brand 102 00:04:32,000 --> 00:04:33,960 Speaker 2: Cereal was when he was a child, and I was like, 103 00:04:34,000 --> 00:04:36,240 Speaker 2: that's so funny. When I think about store brands from 104 00:04:36,279 --> 00:04:39,280 Speaker 2: twenty years ago, I think mostly black, right, Like they 105 00:04:39,320 --> 00:04:42,599 Speaker 2: were just dramatically inferior to the name brand goods and 106 00:04:42,640 --> 00:04:45,839 Speaker 2: that is just not the case anymore. And so like 107 00:04:45,880 --> 00:04:49,239 Speaker 2: when you think about the retailers that really brought about 108 00:04:49,240 --> 00:04:51,720 Speaker 2: the store brand renaissance, I think of Trader Joe's and 109 00:04:51,760 --> 00:04:55,080 Speaker 2: Costco as being two of the best in this space, 110 00:04:55,520 --> 00:04:58,960 Speaker 2: where anytime when you're buying a Trader Joe's branded product, 111 00:04:59,000 --> 00:05:01,360 Speaker 2: you're like pretty sure it's be great. And the same 112 00:05:01,400 --> 00:05:03,920 Speaker 2: with Kerkland signature, and actually that's what Costco says before 113 00:05:03,960 --> 00:05:06,360 Speaker 2: they launch a Kirkland signature item, is like, we're not 114 00:05:06,400 --> 00:05:08,440 Speaker 2: gonna make it unless we think it's going to be 115 00:05:08,440 --> 00:05:11,039 Speaker 2: better than the name brand good that it's next to 116 00:05:11,160 --> 00:05:13,760 Speaker 2: on the shelf. And then Walmart is getting into this 117 00:05:13,800 --> 00:05:16,080 Speaker 2: game in an even bigger way. Instead of just like 118 00:05:16,680 --> 00:05:20,720 Speaker 2: thinking about the value and the price proposition helping people 119 00:05:20,720 --> 00:05:23,719 Speaker 2: save money, it's also about helping people maybe find something 120 00:05:23,800 --> 00:05:26,719 Speaker 2: that's tasty and of a better overall value. And so 121 00:05:26,800 --> 00:05:29,160 Speaker 2: Better Goods is their kind of recent label. I haven't 122 00:05:29,160 --> 00:05:31,080 Speaker 2: tried anything from them, but I'm like, man, the branding 123 00:05:31,080 --> 00:05:35,200 Speaker 2: looks good. Like the way they're billing their new store 124 00:05:35,240 --> 00:05:37,840 Speaker 2: brand products. It sounds sounds great, And when you look 125 00:05:37,880 --> 00:05:40,560 Speaker 2: at the statistics, consumers seem to more and more be 126 00:05:40,680 --> 00:05:43,600 Speaker 2: trusting store brand products, and buying store brand products is 127 00:05:43,600 --> 00:05:45,760 Speaker 2: a way to save and maybe the gap isn't quite 128 00:05:45,760 --> 00:05:48,760 Speaker 2: there in terms of pricing where it used to be 129 00:05:48,800 --> 00:05:50,640 Speaker 2: where store good store brands are gonna save you a 130 00:05:50,680 --> 00:05:53,560 Speaker 2: ton of money. They'll still save you money, and I 131 00:05:53,600 --> 00:05:55,160 Speaker 2: think in a lot of ways you'll be eating better 132 00:05:55,160 --> 00:05:58,000 Speaker 2: if you out for those private label of store brand goods. 133 00:05:58,040 --> 00:06:00,320 Speaker 2: So if you're just kind of like a need jerk 134 00:06:00,760 --> 00:06:03,839 Speaker 2: name brand buyer, I just want people to maybe rethink 135 00:06:04,480 --> 00:06:06,920 Speaker 2: how they shop in the grocery store and at least 136 00:06:06,960 --> 00:06:08,760 Speaker 2: consider more of those name brands. When you think about 137 00:06:09,160 --> 00:06:11,640 Speaker 2: a grocery store like Aldie, they have like a twice 138 00:06:11,640 --> 00:06:14,360 Speaker 2: as nice guarantee too, right where you buy the store brand, 139 00:06:14,360 --> 00:06:16,320 Speaker 2: and if you're like that wasn't very good, you can 140 00:06:16,360 --> 00:06:18,440 Speaker 2: take it back for a full refund and a replacement. 141 00:06:18,520 --> 00:06:21,200 Speaker 2: So that makes it I think a little bit easier 142 00:06:21,400 --> 00:06:23,360 Speaker 2: to kind of put your toes in the water. 143 00:06:23,560 --> 00:06:26,360 Speaker 1: Okay, more great advice from our friend Joel Larsgard. You 144 00:06:26,400 --> 00:06:30,920 Speaker 1: can find out more from Joel on Sundays from noon 145 00:06:31,120 --> 00:06:33,440 Speaker 1: to two right here on KFI. The show is called 146 00:06:33,440 --> 00:06:36,120 Speaker 1: How to Money with Joelarsgard. You can also follow him 147 00:06:36,200 --> 00:06:37,640 Speaker 1: at how to Money Joel. 148 00:06:37,680 --> 00:06:39,240 Speaker 2: Thank you, Joel, Thanks Amy. 149 00:06:39,279 --> 00:06:40,320 Speaker 1: All right, talk to you soon.