Credit cards are dangerous. Period.
They cause serious damage to your financial stability.
I think many people are already aware of the dangers of using credit cards and taken preventive measures to protect themselves from credit card debt.
However, even now many people go on acquiring single or multiple credit cards and invite debt into their lives with open hands.
Let me discuss some interesting and silly reasons why people still go for a new credit card even though they already know/experienced all the evils of it.
Reason 1 : Your close friend has a credit card and manages it very well
Our take on this: It could be true for him. He might be surely managing the credit card really well, but how can it be true for you. Your spending habits are different than him. And, if you are an aggressive shopper, then getting a credit card is the worst thing you ever going to do. Once it is in your hands, you will have no choice but to exhaust your credit limit as soon as possible. Welcome to the world of credit card debt.
Message : Don't do what your friend does.
Reason 2 : You are victim of an aggressive credit card marketer who says the new card is free for life and there is no harm in keeping one
Another practical scenario. You get call from an aggressive marketer who says that a new card has been launched and best part is, it is free for life. You don't have to pay any annual charges for it. He will even go to extent that you just take the card and don't use it. What's the harm in keeping it since it's free anyways?
Our take on this: Nice campaigning by the way. Now my dear friend, what's the point in taking the card and not using it. Is this really the aggressive marketer wants? If you use the common sense, you will know that this offer has two hidden benefits (only for the marketer).
He gets his commission as soon as you get the card and you will start using the card someday (though he suggested not to use it).
Smelling the the trap now?
And regarding the life time free offers - I have just one thing to say.
" Free things are most expensive things". If something is free, it has something attached to it, whether it could be good or bad. In the credit card case, it's the worst.
Reason 3 : Offers that come along with the credit card are really tempting
I am not saying all offers are worthless, but most of the offers ask you to use your credit card. So spend more to benefit more.
Hope you got my point.
Our take on this: Don't trade peace of mind with the offers you don't really need.
Reason 4: Credit card comes handy when you have no money or in the case of emergency
Strong point that pushes you to embrace the plastic danger with open arms.
Our take on this: If you are in emergency, ask your best friend for money. He will surely help you.
In the cases when you have left with no money and want to use the credit card in emergency, soon you will be bankrupt and even your best friend also won't be able to help you.
Don't forget the basics of wealth building. Eliminate the obstacle called credit card from your way. Having a credit card is actually the biggest emergency.
Reason 5 : No need to carry cash, just carry credit card. It's safe
Are you kidding? Carrying a card with credit limit of 10 times of your salary is safe? Have you ever carried that much cash in your wallet?
What if you lose your card or even your wallet? Why do want yourself to put yourself in the mess of informing customer care about your 'just' lost card. What happens if you face a bunch of robbers and threaten you for money. If they see your credit card, they might even take you to nearest ATM and get all the cash.
Where is the safety factor?
Our take on this: Carry cash. It's safe as long as your wallet is safe. So care about your wallet, not about what's inside :-)
Reason 6: You get Rewards Points to redeem later
Another cool trap. Have you heard anyone became millionaire by redeeming reward points? Peanuts are not fun when you have spent so much money to earn them.
Our take on this: Accumulate peace of mind, not reward points.
Reason 7: Online Shopping is easy if you have credit card
Agreed. But, really are there no alternatives? Can't you use net banking or debit cards in the place of credit card?
You can.I use net banking for most of my online transactions.
Our take on this : There is always alternatives for online shopping.So, stop using credit cards.
Reason 8: It's cool to have a credit card
Not anymore , especially after above 7 points. It's really not cool to have credit card debt.
Reason 9: Credit cards are way of life
They are.
Recession is also becoming way of life.
But ,is that comfortable? Certainly not. Don't make something your way of life when you know it does more harm than good.
Moral of the article: It's in your hands to take care of your financial status. Be wise. Don't fall in credit card debt.
So when are you becoming credit card debt free?
Want to know, how to cancel a credit card? Read this article
They cause serious damage to your financial stability.
I think many people are already aware of the dangers of using credit cards and taken preventive measures to protect themselves from credit card debt.
However, even now many people go on acquiring single or multiple credit cards and invite debt into their lives with open hands.
Let me discuss some interesting and silly reasons why people still go for a new credit card even though they already know/experienced all the evils of it.
Reason 1 : Your close friend has a credit card and manages it very well
Our take on this: It could be true for him. He might be surely managing the credit card really well, but how can it be true for you. Your spending habits are different than him. And, if you are an aggressive shopper, then getting a credit card is the worst thing you ever going to do. Once it is in your hands, you will have no choice but to exhaust your credit limit as soon as possible. Welcome to the world of credit card debt.
Message : Don't do what your friend does.
Reason 2 : You are victim of an aggressive credit card marketer who says the new card is free for life and there is no harm in keeping one
Another practical scenario. You get call from an aggressive marketer who says that a new card has been launched and best part is, it is free for life. You don't have to pay any annual charges for it. He will even go to extent that you just take the card and don't use it. What's the harm in keeping it since it's free anyways?
Our take on this: Nice campaigning by the way. Now my dear friend, what's the point in taking the card and not using it. Is this really the aggressive marketer wants? If you use the common sense, you will know that this offer has two hidden benefits (only for the marketer).
He gets his commission as soon as you get the card and you will start using the card someday (though he suggested not to use it).
Smelling the the trap now?
And regarding the life time free offers - I have just one thing to say.
" Free things are most expensive things". If something is free, it has something attached to it, whether it could be good or bad. In the credit card case, it's the worst.
Reason 3 : Offers that come along with the credit card are really tempting
I am not saying all offers are worthless, but most of the offers ask you to use your credit card. So spend more to benefit more.
Hope you got my point.
Our take on this: Don't trade peace of mind with the offers you don't really need.
Reason 4: Credit card comes handy when you have no money or in the case of emergency
Strong point that pushes you to embrace the plastic danger with open arms.
Our take on this: If you are in emergency, ask your best friend for money. He will surely help you.
In the cases when you have left with no money and want to use the credit card in emergency, soon you will be bankrupt and even your best friend also won't be able to help you.
Don't forget the basics of wealth building. Eliminate the obstacle called credit card from your way. Having a credit card is actually the biggest emergency.
Reason 5 : No need to carry cash, just carry credit card. It's safe
Are you kidding? Carrying a card with credit limit of 10 times of your salary is safe? Have you ever carried that much cash in your wallet?
What if you lose your card or even your wallet? Why do want yourself to put yourself in the mess of informing customer care about your 'just' lost card. What happens if you face a bunch of robbers and threaten you for money. If they see your credit card, they might even take you to nearest ATM and get all the cash.
Where is the safety factor?
Our take on this: Carry cash. It's safe as long as your wallet is safe. So care about your wallet, not about what's inside :-)
Reason 6: You get Rewards Points to redeem later
Another cool trap. Have you heard anyone became millionaire by redeeming reward points? Peanuts are not fun when you have spent so much money to earn them.
Our take on this: Accumulate peace of mind, not reward points.
Reason 7: Online Shopping is easy if you have credit card
Agreed. But, really are there no alternatives? Can't you use net banking or debit cards in the place of credit card?
You can.I use net banking for most of my online transactions.
Our take on this : There is always alternatives for online shopping.So, stop using credit cards.
Reason 8: It's cool to have a credit card
Not anymore , especially after above 7 points. It's really not cool to have credit card debt.
Reason 9: Credit cards are way of life
They are.
Recession is also becoming way of life.
But ,is that comfortable? Certainly not. Don't make something your way of life when you know it does more harm than good.
Moral of the article: It's in your hands to take care of your financial status. Be wise. Don't fall in credit card debt.
So when are you becoming credit card debt free?
Want to know, how to cancel a credit card? Read this article
