Do you think credit cards are bad?
Yes. Yes I do.
This is a question that I’ve received numerous times from readers, friends, and family. And yes, the answer is yes, I do think credit cards are bad.
Because they are a false sense of security allowing you to believe that you somehow have more money than you really do.
For most folks, your credit limit is higher than your checking account balance. It’s easy to see this as a positive thing.
I mean, it’s kinda nice thinking that you’ve got $3,600 that you can just spend willy-nilly. Especially when your checking account balance is only $567.89 and your savings account balance is…well…pretty much nonexistent.
It’s nice thinking that your credit card(s) can save you and bail you out of financial emergencies, but can they really?
What exactly do you purchase on your credit card? Do you pay for your kids fundraiser events? Your grandkids massive amount of Christmas presents that you just couldn’t stop yourself from buying? Your best friends Mary Kay party? Your lunch when you aren’t sure if you even have enough money in your checking account to cover it? Your kids birthday party at Monkey Joe’s and the $150 cake that rivals anything found on Pinterest?
And then there’s the real stuff – the emergency stuff. The stuff you claim you only put on your credit card, when chances are there are a lot of non-emergency items on there too. The stuff like, car repairs and home maintenance costs. Stuff like medical bills and insurance deductibles.
So why would I think that credit cards are bad when clearly they serve a purpose?
They make you spend more money than you actually have.
It’s like playing Russian Roulette hoping you have enough money come payday to pay back all the money you borrowed on your credit card. Not to mention you’re hoping the car doesn’t need to be repaired again.
It’s a never-ending cycle. You think you’re getting ahead because you have everything you want and need “paid for” but the reality is, the only things that are paid for, are the things that weren’t bought on credit.
I know, you probably think I’m so wrong for my stance against credit cards but the reality is simple – most Americans complain about how our government spends more money than it earns, but can we really complain about it if we’re doing the same thing in our own homes?
The truth is simple.
You want a better relationship with money? Stop borrowing money and make the money you work hard for every day work for you.
Related Post: The Beginner’s Guide to Budgeting