The Diary of a Budgeter – Day 10

Bobbi Olson Articles, The Diary of a Budgeter

Credit cards: angels of convenience or devils in plastic?

Some people believe that credit cards are ruining people’s lives, because so many who’ve used them have gone into devastating debt. I think this is a fallacy – and a dangerous one.

It is a fact that many have gone into devastating debt using credit cards. But is it the fault of the credit card – an inanimate piece of plastic? Is it the fault of the credit card company who spent millions to tantalize you with salacious offers of having “everything you want” today, even if you won’t have the money for a very long time? Is it the fault of the stores who provided you the opportunity to “save” money, if only you’d pull out that plastic? NO. The fact is it is my fault, your fault, our fault – whomever uses the credit card in an irresponsible way.

It’s hard to say no to things we want, when our society makes it so convenient to get them – but ultimately, nobody is responsible for our decisions but us! We have to weigh the pros and cons – stay focused, when advertisers are giving us only the pros. It’s up to us to make the best decisions for ourselves. After all, we’re the ones who have to deal with the consequences, not the credit card company, not the store, not the product.

So why even have credit cards? Personally, I have 3 big reasons:

1. I tend to spend cash more freely and with less thought. Using credit makes me thoughtful, because I want to be sure I can cover the expense, so I don’t end up with interest charges. Thanks to my budget, I can be thoughtful in a quick manner!

2. I feel more comfortable having my credit card number out there than my ATM/Debit card number. If someone gets a hold of my credit card and starts charging, I can dispute those charges and never have to deal with a loss of money, while they’re sorting it all out. I’ve had the experience of someone making false charges with my ATM card, and it was stressful & chaotic. Sure, I disputed the charges and eventually, the money was returned to my account. But in the meantime, I had to live without $1000 that had been fraudulently charged to my account. I couldn’t pay bills or buy groceries without that money, so it was much more devastating!

3. I truly make money off my credit card, because I use it just like an ATM card – only charging what I can pay for today – so I don’t pay interest, but my credit card pays me 2% cash back. Last year, I made over $700 just for buying what I would have bought anyway – groceries, gas, etc. And I had my cash rewards direct deposited into an IRA, so my free money can grow even more! I know myself well enough to know that I’m not about to spend more than I have – I refuse to pay interest! So this works for me. But I would NEVER recommend it to anyone who is even tempted to overspend – the benefits don’t come anywhere close to the interest payments.

I am thankful for credit cards – they give me convenience, peace of mind and a few extra bucks! I don’t think it would be fair to take them away from me, just because others have struggled to use them responsibly. And I’ve been one of those people – I did use them irresponsibly. Because of that, I had to work very hard to pay them all off and change my spending habits. It was me, not the credit card.

If I’d believed that the poor spending habits of my past were someone else’s fault, I never would have believed I could change my future and live debt-free.

So please, give credit where credit is due!