Credit Cards…No Thanks

I’ll be honest. I am not a big fan of credit cards. Everything I purchase is always with cash. If there is a high priced items such as high-end electronics, vacations, or even a car, I simply save up the cash for them and then buy them. The only thing that I plan on not paying in full will be my future home.

Before I start this rant, let me say that I am okay with the use of credit cards responsibly. This is just a personal view on the overexposure of the importance credit and the credit card companies who are trying to suck every penny out of our pockets.

We are always told the importance of our credit score. They tell us how this can affect everything we do from purchasing certain goods, getting loans, and even getting a job. This is true…To a certain extent. A higher credit score can get you better interest with a bank. A higher credit score can also make it easier to rent an apartment. That’s great! But what they don’t want you to know is that you can still do fine without credit. As I mentioned earlier, if I want something, I save the money for it. When I look for an apartment, I just use my work history, and I pay a larger deposit to get the place I like. When I do decide to get a house, cash will always be king. A large down payment (40% of the value of the house) and manual underwriting is all it takes for me to find my dream home. As for getting a job, I certainly don’t want to work for anybody who solely will hire me due to my credit score.

On an earlier post on marriage and money, I had mentioned about my fiancee paying of her credit card in full and cancelling the account. My fiancee fell into the trap set out by the credit card companies. This particular card gave her all types of discounts in places she shopped at. She believed that by using this credit card she was actually saving money. Wouldn’t you know it that this wonderful card put her $1000 in debt. That doesn’t not sound like a deal I would like to do.

I do understand that if you pay of your card in full monthly, you can actually reap benefits such as a higher credit score (funny how nobody really knows the math into how they come up with this score), and rewards such as:gas, cash, airline miles etc. Again, for all of you that are financially stable and understand the use of credit cards, this is not meant for you. This is for those individuals who need to stop spending money they don’t have, and thinking that a good credit rating is the only thing that will help them in the future. Remember that the credit card companies are a multi-billion dollar business who yearn for you to miss just one payment and start paying the minimum amount. Odds are stacked in their favor that sooner or later you will start falling behind on payments and that is when they win. Those are odds I don’t want to play with it.

If you are interested in learning about some of the horrible business practices that the credit card companies do I suggest going to your local library and renting the movie Maxed Out. You can also watch it here:

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