In this age of digital payments like ]Credit Card, Debit Card and Net Banking, I often wonder, are credit cards in the USA are a really a good idea? Is cash still the best option? Let’s take a closer look and find out.
The Benefits of Credit Cards
Credit cards have unfortunately become a part of our daily lives, offering a false sense of convenience, security, and financial freedom. Here are some key advantages.
- Credit cards eliminate the need to carry large sums of cash, since you don’t have any to spare any way.
- Credit cards provide a financial safety net during emergencies, because you don’t know how to save money in the first place.
- Credit cards offer tempting rewards, cashback, and discounts, leading you to believe you are saving money, when you are in fact spending like a maniac.
- Credit cards can help build a solid credit history, essential for future loans, because you don’t know what financial independence is.
In case, you’ve made it so far in to the article, you may have caught wind of my cynicism. The truth is there are no benefits of a credit card, it is an illusion! Remember, the borrower is always a slave to the lender.
The Pitfalls of Credit Cards
It is essential to acknowledge the potential downsides of credit card usage, as they don’t have any plus points:
- If you don’t pay your credit card bill in full, the interest rates can be very high, leading to mounting debt.
- Credit cards can encourage overspending since you don’t physically hand over cash.
- Lots of hidden charges and fees that can eat into your finances.
- The list goes on and on…
Why Cash is King
Cash remains the preferred choice for many in the USA and throughout the world because:
- Cash allows you to have total control over your expenses. You can physically see how much you’re spending. When you spend cash, it activates the pain sensors in your brain and you know that the money you’ve handed over to someone is not coming back, unlike in the case of plastic cards.
- Cash transactions are private, unlike credit card transactions that leave a digital trail.
- Cash transactions don’t accumulate interest, making them a debt-free form of payment.
- Cash is accepted everywhere, even in the remotest part of the country with little to no infrastructure.
One of the major issues with credit cards in US is also the challenge they pose to financial discipline. People often fall into the trap of accumulating debt, leading to a vicious cycle of high-interest payments. These people get drowned in debt and end up ruining their lives. Flashy advertising and tempting offers lure gullible individuals into acquiring multiple credit cards, beyond their financial capacity.
Financial Literacy
A lack of financial literacy can lead to these poor choices. If you choose not to use credit cards in US, congratulations, you’re a smart person. In case you do use one, get ready for a future full of debt and suffering. Remember, there is no such thing as responsible credit card usage, like making timely payments and maintaining a low credit utilization ratio to build a credit score. If you need a credit card to buy something, it means you can’t afford it! So don’t buy that thing, save up cash and then buy whatever you want. And always remember, CASH is KING!
