Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
So my question to all is how do you view your Credit Card spending? - When I did, it was an opportunity cost to me.
Do you view this debt as free money? - It wasn't free. It's never free.
Do you view this money as a loan? - Like a loan from a shark or a snake.
Do you even have a clear understanding of what a Credit Card really represents? - Double edged sword.
I view credit card spending as an opportunity cost for most people. It's money they could be investing in themselves. It tends to be impulsive and you spend more than you would cash in hand.
It certainly was an opportunity cost when I first got married and we were deficit spending beyond our income on average about 3K for the first two years of marriage. We bought stuff to beautify our home. We thought it was "good money spent" because the improvements were things such as tile and paint. We installed the tile and painted ourselves with the goal of "sweat equity." Sure, there were probably a few sushi dinners thrown in for good measure or an airline ticket home for the holidays when my wife "absolutely" needed to see her family. We were eeking by an existance but knew our income had no where to go but up as young professionals.
That was about 2 years worth of carrying a balance that never really went anywhere. We would charge it up and down, but when I noticed our "deficit spending" I decided to change our ways.
We have a lot more income now and more credit than we will ever use. We don't carry a balance at all. We just closed two of my wife's accounts because one credit card company said that we weren't profitable enough and the other wanted to charge us an annual fee. Oh well!
We really don't even use our cards as transactionists (pay off next day, next week) because my card is through a credit union with little to no benefits. Oh well! Its not like you hear many people at the top telling you how the thing that really changed their life was rewards points.
We pay our balance off every month but I do find it easier to use cards than cash. If I took out $200 for groceries and only spend $120 that money would have a way of slowly disappearing. I also like the points. When I had my first card I did end up owing and having to make payments. It wasn't huge but was a great lesson that I'm glad I learned. I think it started with something like buying a nice coat that I intended to pay off in 3 months, then the car breaks down, etc. Pretty classic in over your head stuff. When interest rates were lower I could see using one for an "emergency" but at the current rates it isn't even feasible. We have a HELOC for emergencies (big, unexpected house repair or something like that). The interest rate is much better and tax deductible. We used that to do some remodeling when we first bought the house and to put a bigger down payment on a car. We use that very carefully too and often just to not deplete our cash savings. We don't do more than one thing at a time with it and we borrow knowing when we will pay it off. If you can trust yourself with credit I think it's a much better way to go for a possible emergency. I would never use it for a vacation or a luxury purchase but we are considering replacing some windows and we may use that again.
Credits cards are meant to provide the convenience of shopping anywhere/anytime. They save you from any mess with cash like carrying a lot of cash, cash safety etc. Even you can shop things sitting at your home by using your credit card. But this needs a wise thinking. Sometime people keep on buying thing blindly and cross their credit limit. Always try to keep a check on your credit limit and buy only what you can be able to pay at the end.
bek you are not supposed to manage it you are not supposed to have it.
that is like saying why am i not doing a better job of managing a 12 ft anaconda under my bed.
see dave ramsey and live, the snake catcher.
Credits cards are meant to provide the convenience of shopping anywhere/anytime. They save you from any mess with cash like carrying a lot of cash, cash safety etc. Even you can shop things sitting at your home by using your credit card. But this needs a wise thinking. Sometime people keep on buying thing blindly and cross their credit limit. Always try to keep a check on your credit limit and buy only what you can be able to pay at the end.
Debit cards provide the same convenience, but I must argue that using cash isn't nearly as "messy" or dangerous as many of you make it out to be. I routinely carry several hundred dollars in my purse. Am I nervous about it being stolen? No more so than I'm anxious about somebody lifting the other contents of my purse. Replacing the cash would be a hassles, of course, but somebody could wreak much more devastating havoc in my life with my house keys and license, which lists my address. Those would be in my purse regardless of the presence of cash. This whole "cash is dangerous" argument is terribly overblown. If it really worries you, divvy it up and carry a couple of twenties with you while leaving the majority of it at home.
I view using a CC as advancing civilization; paying with money is archaic. I never pay fees & am content with my CC company making a ‘fair’ profit any way they can. I pay cash @ Aldi’s (mandatory) & small establishments as a common courtesy.
Quote:
I think it's because people suck at math.
You don’t need to know math to understand that when you borrow you will pay dearly.
Quote:
How do we go about solving this?
Simple, people just need to be respectful & responsible. Every time my CC company raises my limits I call them up & tell them to bring it back down. I don’t care if it affects my credit score; I don’t like being manipulated against my principles!
While I don't find cash all that troublesome, there is one frustration that using a debit card negates. When I use cash, I tend to accumulate a great deal of change. Because I use a financial institution that does not provide storefronts where I could count and deposit the change, I have no option other than to use the counting machine at the grocery, which charges me ~9% for the privilege. Using a debit card allows me to keep that money in my account. That said, I have to be vigilant about extra items creeping into my cart at the grocery, etc., because it can quickly undo the few dollars of savings.
Last edited by formercalifornian; 03-04-2010 at 09:25 AM..
The Government is about to change some of the rules,laws regarding Credit cards. Some have gone into effect already. The Direct Express cards are about to be expanded to cover more than Social security , and , they are considered a debit card. Stay tuned for more changes. The days of checking accounts are soon to be a thing of the past. With direct deposit gaining popularity all across the country ,I could see the day coming when you will never write a check again ! Its coming.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Beef Liver
