In this episode of Church Planters Ask Podcast, host Danny Parmelee answers the question, “Should My Church Plant Use a Credit Card or a Debit Card?”
Here are a few reasons to consider using a credit card for your church plant:
With a debit card, when you are hacked or your card is stolen and used fraudulently , that money actually leaves your account.
And yes this has happened to me personally.
So if you have $1000 in your account, and the thief takes $900, your bank account is down to $100.
That means if you have any purchases or autodrafts, its going to trigger a domino effect of bounced checks.
This is going to cost you more money AND possibly be embarrassing as checks are bouncing.
Its also a pain to straighten out all your accounts with the fees and money in and money out.
Most banks have fraud protection even on debit cards so you will get a certain amount of that money back, BUT potentially not some of the fees from other banks. And you don’t get your time back.
With a credit card, even if funds are stolen or used fraudulently, you can call the credit card company and get your statement adjusted before any money ever leaves your account.
Using a credit card helps to manage your cash flow, because you have a month between purchases.
Not that you should be living on a razors edge, but it does give you a little space between giving and deposits and paying bills.
Thirdly is that
Credit cards tend to have the best rewards programs.
There are two that I particularly like and that is airline mile rewards and cash back.
Now let me give an important warning and caution here: you have to be very careful on who and how these rewards are used, issued, and distributed.
It can be a major conflict of interest if you are the lead pastor of the church and receiving the rewards from spending.
So this is what I suggest:
If you use a cash back rewards program, that the money goes directly to the church. You should never touch it.
The Chase Business Ink card is great for this because there is up to 5% back on certain types of purchases and many are what you as a planter will be spending them on.
With airline miles cards, the ideal way to use those airline miles is specifically for ministry-related travel. For example, it could be used for a missions trip.
Or even if you use the airline miles to travel to a church planting Conference like Exponential or UNleash.
But you have to be very careful with this because you don’t want to create the perception at all that you are spending money frivolously so that you have a benefit.
That is why I probably prefer cash back that goes directly to the church.
Also, credit cards often come with rental car coverage. Its just an added bonus so when you are traveling.
You don’t have to buy extra insurance when the car rental people try and scare you into buying their overpriced coverage.
My biggest warning about a church plant using a credit card is this: make sure you use it as a tool for purchasing and NOT for credit.
By that, I mean that you should only purchase what you can pay off immediately without tapping into the credit and owing interest. Don’t do it.
So Dave Ramsey, if you are still listening hope that heals your bleeding ears.
Credit cards are great for record keeping.
Some debit cards do have a good tracking of transactions but it really depends on the bank.
The big credit card companies have sophisticated records so that if there is ever a question or challenge you can dig up records to verify transactions in years in the past.
My two favorite credit cards are the Chase Business Ink and the Chase Southwest Airlines Card.
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