And now, a brief 10 years later, I could proudly say that I have never had a charge card (and I never will).
Here are the reasons why I despise credit cards
1.I am a spender
I will certainly spend money I do not have if I utilize charge. I like clothes; I like nice things. I know myselfand I am acutely conscious of my desire to spend. By using debit or cash (as a credit), I am sure I do not invest more than that I have.
Credit encourages overspending as you are given access to more capital than you really have. This is quite tempting!
On one of the episodes, Dave Ramsey stated,”if debt is an alternative, you’ll always be in debt”. I genuinely think this, so I choose not to let credit to be an option. Instead, I use a crisis fund to finance things that are unforeseen.
3.Rewards aren’t that good
For me, the benefits are not worth the temptation. I believe that if a business can suck you into due to the rewards, you’re actually at their mercy (and of course that they can change these rewards anytime ). I want the control, not the corporation. Remember: they’re in a business to generate money, time.
4.Old habits die hard
As soon as you’re in, it’s hard to get out. I understand this from student loan debt. I’ve got a whole great deal of debt out of law school, and while it’s going down, it’s so hard to get out of. I don’t ever need to do so again. And while my student debt is possibly well worth it (possibly?) I could never justify debt.
He understands it, makes it… he who doesn’t… pays it.”
This means that in case you spend money, you get compound interest, but should you use a credit card and carry a balance over to another month, you are going to pay compound interest.
Compound interest is interest calculated based on the prior period’s principal and interest over time. The concept is that your money grows exponentially over time.
For much more in your credit card along with chemical interest, visit: Compound interest and Consumer Debt
6.My debit card is protected
Some say using your debit card can be insecure. But if you use your debit card since a credit, it is not. If you use”credit” instead of”debit” when you swipe your debit cardthe merchant charges your card as though it were a credit card, which then gives you all of the protections that are given to credit card users. If I use my debit card at the grocery store and choose credit, I’m afforded all the protections that all Visa credit card consumers are afforded. Should I swipe it as debit, I only receive the protections my regional bank provides. Therefore, I use my debit card and then choose”credit” for buys.
“However, I repay my card monthly” To that I sayI trust you can do! For me, it’s too tempting and never worth the danger. And looking at the numbers, it is definitely too tempting for a whole good deal of individuals.
Even accounting for your swing in very indebted households, the average household owes $7,087 in credit card debt.