I hear it all the time. Credit cards are evil. They’re the reason that people get buried in debt. They’re the reason why people end up overspending. I disagree.
While I can sympathize with those who are facing financial struggles and hardships, you can’t blame the credit card for their problems. The credit card is a useful tool that you can use to your advantage, but it can also be one that can get you in trouble. The same line of thought can apply to a kitchen knife. It can be used to prepare a delightful meal or it can be used in a ghastly crime. The knife itself is not to blame; it’s the person who wields it.
It sounds simple enough, but the single biggest piece of advice when it comes to credit cards is this:
Always pay off your monthly balance in full.
Yes, falling into the trap of spending more money is an easy one, but it’s one that you have to overcome. You need the willpower to say no. At the core, if you cannot afford to purchase an item in cash, then you probably shouldn’t be putting it on your credit card either. There may be extenuating circumstances where this cannot be avoided, but it holds up as a general rule of thumb.
I’m not saying that if you can’t pay for something in cash that you shouldn’t get it at all. Not all debt is bad debt. Most people cannot afford to buy a home if they don’t take on a mortgage, for example. Some people choose to finance their vehicles and it’s up to you if that’s the right decision given your current situation. That said, I would not finance anything through my credit cards.
Again, it’s worth re-iterating that credit cards are tools that can work in your favor. Most of them offer some sort of rewards program, either as dividends or reward miles. When you use your credit card, you accrue these “bonuses” that you would not otherwise accrue when paying in cash. Some debit cards have reward programs too, but I find those on credit cards tend to be better. Credit cards can also help with budgeting, as your monthly statements make it much clearer exactly where you spent your money.
As with so many other things in life, it comes down to self-discipline and foresight. Credit cards are not the problem. It’s all about how you choose to use them.
It’s the easy way to spend, it’s the thing as gambling. IF they are there people are going to use them. The credit card companies use every enticement to get you to have a card, leave a balance, etc. While it is up to the person to monitor their money and it’s use, it’s like putting a carrot in front of a horse.
Credit cards have no useful purpose. Debit cards do because they tap straight into your bank account. Credit cards are EVIL in every way, they serve no purpose and prey on the weak and sometimes the strong.
I’m surprised by your extreme negative opinions about credit cards and its purpose.
Like Michael said,”Credit cards are not the problem. It’s all about how you choose to use them.”
Just out of curiosity, do you use credit cards to pay for your purchases?
I don’t agree with the ”Credit cards are not the problem. It’s all about how you choose to use them.” because as I said the Credit card companies make them available with all kinds of carrots to get us to use them. All the while they know that they have given us something that can be used irresponsibly like gambling.
I use a debit card that is tied right into my bank account without being able to carry a balance, so I cannot overspend, do not have a monthly payment and have too many cards that can be abused.
The Credit Card companies are under no control to give you a card, even if you already have 3 and are using them to max out those cards. But, they do have the ability to raise your rates to astronomical percentages and to add credit to get you to use more and to be indebted to them for a long time so they can keep reaping those high, free interest rates.
I feel that saying they serve no purpose and are evil is a bit hyperbolic, but I agree with the general sentiment.
From what I’ve read, I believe that people subconsciously don’t recognise that they’re spending real money when they use credit cards, and thus are likely to spend more money. I’m not sure whether this effect carries over to debit cards, though.