What’s your view on credit cards? If you ask that question 100 times you will probably get 100 different answers. My friend Matt Wegner recently wrote a great article titled “Can you live debt free and still have credit cards?” I left my thoughts in the comment section and if you have read this blog very often you also know that I do not recommend that people use credit cards.
A common belief about people who are against credit cards is that they think credit cards are evil. Personally, I do not feel that credit cards are evil in and of themselves. It is what you do with them and how they are harmful to your financial health that makes them a bad financial product.
It is the overspending, getting into debt, and the burden of high minimum monthly payments that I hate.
It is the not paying attention when you use credit cards and falling into the trap of being just “good enough” financially that bugs me.
It is the pre-commitment of your future income that robs of you of the ability to follow your dreams and goals that I can not stand.
But even if you do not carry a balance or pay interest on your credit card, it does not mean you are not being harmed. To me credit cards are like a cigarette. Yes, you can smoke your whole life and never get cancer, but to say it never impacted your health negatively would not be a true statement. Likewise with credit cards, you might never carry a balance on your card, but the overspending, the not paying attention to where your money is going, and the missing out on discounts by not using cash will impact your ability to win with money.
So what’s your view on credit cards? I would love to hear your opinion. Leave a comment below or vote in our Facebook poll.