I am so tired of hearing all the bullshit about credit cards.
I personally do not have any credit cards. I don't miss them. I don't use them. I don't need them. I like to think that I live by the mantra, "if I can't afford to pay cash for this or that then I shouldn't be buying it."
(And don't feed me the line about the bonus points you earn...I have only a debit card and I earn bonus points for travel miles and anything else...)
On the news there has been non-stop coverage over the bank bailout and the banks raising interest rates to astronomical numbers. It is crazy. And yet, I can't help but think...
...STOP USING CREDIT CARDS!!
Can it really be all that simple? What has happened to everyone? We gotta have what we want RIGHT NOW despite what it costs or what it will cost us by the time we pay down those credit cards. We gotta have the dinners out, the new clothes, the trips, and of course all that STUFF. Oh sure, there are those of you who pay off your balance at the end of every month...but the majority of people out there don't/can't do this.
Along the same lines with the credit card troubles is the discussion about credit scores and how cutting up your cards ruins your credit score. I think I twitch a little bit every time I hear this statement. Okay, look, I'm all for a super sparkly clean credit score. It will get you great rates on that brand new car you desire. Or, a super duper rate on your mortgage. Or, it makes you hold your head higher because, dammit, your credit score is above 700. Let's hire the military for a 21-gun salute the next time you need to sign loan papers.
I worked in banking at the very beginning of credit scores. In fact, I remember the total confusion and uncomfortableness when trying to EXPLAIN how the whole credit score thing works to countless customers staring at me with a cross between utter confusion and complete anger. Years later I underwrote real estate loans and I would fight to the death over an applicant that had money in savings and NO credit cards (therefore his/her score was lower than their credit card whore counterpart) than the person who had a million...some with balances, some without...and in most cases I got each and every one of those loans approved. Can I say they are all still noble homeowners? I don't know. But, can I say that all the people with their perfect credit scores and wallets full of credit cards aren't losing their homes alongside the rest of the country in this economy? Exactly. I have always believed that a true test of someones worthiness lied in their ability to SAVE MONEY and not buy a bunch of shit they didn't need because obviously they couldn't afford it because if they did they would have just used cash instead of their credit cards. Whew.
When I was an underwriter, I looked more at their stability in home and work. The money they had saved...and less on their ability to accumulate credit cards and "learn" how to pay them off each month (which rarely happened...in fact, we rarely made "debt consolidation" loans because in 99% of the cases, the people went back and charged debt right back up again). I realize I have been out of banking for over a decade and things change but I remain firm in my belief that credit cards are nothing but a pain in the ass. So what if you have an excellent credit score but you are paying through the roof in interest rates. Hmmmmm. Okay, and that is smart, how? So what if you have to wait a few months for that THING you must have instead of pulling out some plastic from your wallet so you can have it now.
You want to stop paying all those high interest rates? You want to stop bitching about how the banks received all that money in bailout only to turn around and charge you triple in interest rates? THEN STOP USING CREDIT CARDS. Pay cash.
What a novel idea...and very, very retro.
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