One of our readers here just commented that on an article of ours!! WOWWWWW… Can you imagine? NEVER using a credit card ever? It’s like spotting the elusive Unicorn or Big Foot! Or better yet, my favorite creature in the whole wide world – the Mermaid! Haha…
Here’s the full quote that was dropped:
“I live in Europe and paying in cash is much more common here. I have never paid with a credit card in a store in my life. If I want something or need something I pay in cash whenever possible. Otherwise I use my debit card.”
At first I was pretty impressed cuz I quickly thought “I bet that person saves a TON not using a credit card!” (after the shock wore off, of course), but as I got my wits about me I realized that’s not necessarily true. In fact, it BETTER NOT be true or else I’m wasting away money using credit every single day/week/month/year! Haha… But I DO like that she has to *budget* for stuff as the option of taking on debt to get something is out of the question. That’s the KEY takeaway point right there: You only spend what you have!
It did stop me in my tracks though, and got me to reevaluate my own payment strategies I’ve got going on. Particularly with my budgeting style of putting everything on credit cards to simplify and get those cash back rewards, etc – something that’s not necessarily offered when paying with a debit or cold hard cash.
Here were the pros and cons I went over again in my head just to make sure I’m still happy with things (which I am, btw, for what it’s worth):
Pros to credit cards vs. cash:
- Easy peasy spending with a swipe of a card
- Lots of cash back and/or other sexy rewards
- Higher limits of spending vs what’s physically in your accounts
- Easy to budget with if you put everything on ONE card (and simpler)
- Lots of security in place in case it gets stolen, lost, hacked. Particularly charges wiped away from day #1 whereas with cash/debit it takes much much longer… depending on what type of card/company you use and when you report it, etc etc. (well, not with cash – that goes bye-bye the second it’s gone!)
Cons to credit cards vs. cash:
- Higher chances of spending more (at least that’s what the “pros” say)
- Higher chances of not paying stuff off in time – or ever.
- Higher fees/penalties if you make a boo boo and/or carry balances over
- Not every place/person accepts credit cards, so you ALWAYS need to carry cash anyways just in case… As debit cards won’t work either in those cases.
I think that’s about it? Overall I do tend to think those who use credit cards spend more in the long run for stuff, but how much we’re talking depends on the user and their own habits/personality. Some people can handle those cards like a champ (I’d like to put myself into that category, if I may ;)), while others would dig themselves into such big holes that they shouldn’t even apply for a card to begin with. Like those coming out of high school or college/etc when it all seems like “free money” to them (or was that just ME back then? Haha…)
Regardless, I find it all kinds of fascinating that there are still people out there who have never owned, nor used, a credit card before. Like our new friend who left that awesome comment up there above… It sure gets you to stop for a second and contemplate your own methods! And makes me wonder how people view this type of stuff in other countries vs. the U.S. too – where we’re known for overspending and gorging ourselves with lots of “stuff.”
Actually, that’s a great question for some of you all out there:What’s the word on credit card usage in YOUR country? And for those who ARE a fellow member of our United States, do you think you could ever stop using plastic if you tried? Or would the chance of saving more not outweigh your current credit card usage anyways? Like how it doesn’t for me?
I wanna see how different your views are on this today… I’d say I’d give the “all cash” test a try for a month or two and report back, but I’ve already said that 3 times in the course of my 5 years here and I wouldn’t want to lie to you again ;) So tell me about your experiences instead!!
[Brilliant photo by carlos.a.martinez]
Jay loves talking about money, collecting coins, blasting hip-hop, and hanging out with his three beautiful boys. You can check out all of his online projects at jmoney.biz. Thanks for reading the blog!