We have a love hate relationship with credit cards.
As a kid I remember my parents’ American Express card. I’d go with them shopping and watch as the cashier swipe this plastic card into a machine and voila the toys were mine. That image is still with me years and years later.
To a kid that rectangle was a source of happiness allowing me to get things without losing my allowance money. As an adult, we learn how valuable it is to control the impulse of spending on credit.
It’s definitely a love hate relationship when it comes to credit cards.
Some family and friends will tell you to stay away from credit cards. “It’s no good for you. You can do better. Don’t make the same mistakes I’ve made.” But, with those warnings, our interest in them peaks and we are drawn to the allure of those shiny plastic rectangles.
Our relationships with credit cards are like personal relationships. We may not need the help of another to live life but having someone (or something) during certain moments can be quite useful. Have you tried moving to a new home without any help? Go try renting a car without a credit card.
Did he just compare my love to a piece of plastic?
Credit cards are useful and can add a layer of protection and comfort in your life but they can become a pain when they go unchecked. They can help you in moments of emergencies but can haunt you for years on end.
And just like a relationship you should evaluate the benefits.
- Is the terms and conditions still beneficial to me?
- What benefit is it for me to have this card?
- Are there better alternatives?
Experts and gurus will tell you to stay clear of credit cards. But, every where you turn, you’ll find credit card advertisements luring you back to those childhood moments. We are all susceptible to advertisements but these very same blogs or information portals that tell you to stay away from credit cards are advertising credit cards.
The reason is that credit cards do have benefits that may outweigh the negative stigma that follow them. Your partner may have their negative parts but the good things may outweigh the bad ones.
Credit card benefits range from establishing credit to earning reward points to extended warranties. They’ll give you an extra layer of protection beyond a debit card and can be a recourse when disputing with a seller. Credit cards do have drawbacks when it comes to overspending. It’s easier to do so when it’s not your money. But, keep in mind that it is your money and you run the risk of impacting your overall financial wellbeing.