When is it OK to use your credit card? Some might say never, and with consumer debt topping 1.7 trillion dollars this year, maybe they’re right.* But why are credit cards so bad, and is going all cash really the answer?
Credit Cards Distance You From Your Spending
People spend more when they pay with their credit card. It’s inevitable. When you pay with cash, you feel every penny. You only have so much cash on hand and each dollar you spend is a dollar less in your pocket. This direct connection with your spending keeps things in perspective. Spend $50 bucks on eating out this week, and you’ll feel the emptiness of your wallet by the end of it.
In contrast, when you pay with a credit card the payment happens out of context. You spend $5 on a sandwich one day, $6 on a burrito the next, and nothing adds up. Not until the end of the month when you’re hit with a $300 bill that you don’t understand, and may not have the money to pay in full.
Did you know you can sync your EEBA household across multiple mobile devices and the web?
Anyone who’s tried, knows. Sitting down to talk about money can be stressful. Whether it’s a spouse, a child, a dependent parent, or even a roommate, our lives –and our money– are interwoven with those around us, and with that comes conflict. We enter conversations about money with the best of intentions, but often leave frustrated or even resentful.
