Rick says he's "not some scissor-snapping radical who thinks that all plastic is bad." Neither am I. I agree that the lure of charging material fripperies you don't need or can't afford is a potential pitfall of plastic. Rick says, "Finding a no-annual-fee credit card... is great -- as long as you wipe the balance clean at the end of every month." I completely agree with him. Rick is pretty much making my argument for me. So I can only reiterate that I really believe responsible use of a credit card is at least as Foolish as not carrying credit cards at all.
Rick seems to think debit cards are the better option. I'll even concede that debit cards have their uses, as a simple way to replace the effort of writing checks. But they have problems I prefer to avoid. Some merchants are reluctant to accept debit cards, most notably airlines, hotels, and car rental businesses. I guess if you never travel, this wouldn't be a problem for you, but how many of us never travel? Some banks charge point-of-sale transaction fees every time you use the debit card they gave you (and those quarters can really add up over the course of a month). And the legal liabilities of debit card issuers have not caught up with those of credit card issuers -- if someone nabs your debit card, or even copies down the number from a receipt, you can by law be held responsible for up to $500 in fraudulent debit-card charges.
So what's the answer? The right thing to do is whatever's right for you. But don't avoid credit cards unilaterally just because some people (OK, an unfortunately huge number of people) end up in trouble with them. Evaluate the way you handle your finances. If you can follow a realistic budget and pay off your charges every month, plastic can definitely be your friend.
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