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My credit cards live in a drawerApr 03 '00 Write an essay on this topic.Debit cards and credit cards both have their place in today’s society. Neither is evil, although there are ways of abusing both. But that doesn’t mean the cards are evil - they’re pieces of plastic for goodness’ sake, how can they be evil? I don’t particularly like credit cards anymore, though from the balances we’re carrying on various cards you’d never believe it! But those balances are exactly why I don’t like credit - it’s so easy to run up a huge balance before you know it because it’s so darn easy to just whip out the card and say “charge it!” As I get older, I’m getting better, but as recently as a couple of years ago I had very little self-control when it came to buying on credit. My immediate wants were more important than my future needs. Unfortunately, my husband is a lot like me in that way, so neither of us really had someone to say “STOP!” and thus we’d spend spend spend, racking up thousands of dollars on our cards over the course of our marriage. We finally wised up and realized we were never going to be able to get the cards paid off if we didn’t stop adding to them. We would max out one card, then go on to the next, then another would get a credit line increase and so we’d go shopping with that one. Do I see some of you nodding in recognition and agreement out there? :-) Once our bank converted our ATM card into a debit card (also called a “check card”) in late 1998, we decided that we were no longer going to use our credit cards unless it was absolutely necessary. And I’m happy to say that the only time we have was when we had to rent a car, and the only reason is because we wanted the extra protection that our gold card gave us in the event of an accident with the rental car. (Side note: I do know that there are some rental car agencies and similar travel-related companies that will not accept a check card as a deposit and will only take a credit card, but there are others that will and you just have to find them if that’s what you want to use or if you don’t have a credit card.) I love my check/debit card because it’s so convenient. Yet I know I can’t just go spend on anything I want since the money comes straight out of checking. We do keep a rather substantial balance in our account, both to cover the minimum required before a fee is imposed and so that we don’t have to worry about overdrawing the account in between weekly (sometimes bi-weekly or monthly!) updates of Quicken. But I still know that I can’t just go buy a few hundred dollars worth of clothes on a whim because that’s not what the “cushion” in the account is for. I buy a lot of stuff online because it’s convenient and it’s easy, and often it’s cheaper than buying it locally if I have a promotional coupon that I can use. The check card works just as well as a credit card would, and since it’s associated with Visa, it has the same (if not better) protection that a Visa credit card would if someone were to somehow obtain the numbers. So I have no worries about using it online, nor do I worry about using it anywhere in the “real world”. A credit card is nice to have in the case of a true emergency, but we’re also working on building up our savings so that we don’t have to rely on one even then. It’s a nice feeling to be able to pay for those new tires with a check or the check card instead of adding another few hundred to the credit card bill. Sounds weird, doesn’t it, for me to say that I like to see a few hundred dollars come out of my checking account! But knowing we have the money in there to cover it and that we don’t have to charge it is a real turn-around and one that I really like. I realize credit cards can be a good deal for some people who prefer to use their promotional credit cards to rack up frequent flyer miles or new car discounts or other rewards. A lot of those people have better self-control when it comes to credit cards and can pay them off monthly, and I hope I’m like that some day. I don’t know that I’d ever start using a credit card just for that purpose, however, but it’d be nice to know that I could. For right now, however, I know that credit cards and me aren’t a good mix for the most part, and I’m happy to leave them at home while I take my check card along in my wallet. If you can pay off your balance monthly and have a good promotional credit card, I’d say go for it and reap the rewards of good financial habits. If you can’t pay it off monthly and already have hefty outstanding balances, I’d say stick with a debit card and just be careful not to spend too much. Easier said than done, but if we can do it, so can you!  |
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