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Cash is Always Better Than Credit Cards

By: Brian Williams
Americans just need to get in the habit of resisting the lure of high-interest credit card debt, a leading source of bad credit problems in the United States.
The Real Cost Of Credit Card Use
Advertising fuels Americans' affinity with credit cards. Outstanding credit card debt in the United States is more than $750 billion, with nearly 700 million credit cards in circulation. Credit card companies feast on this credit market, blanketing the airwaves with commercials highlighting side deals on airline frequent flier miles and other perks.

But at what cost?

  • A$100 pair of shoes purchased on a credit card with a 20 percent interest rate will cost at least $120

  • An $800 television set purchased with the same credit card will cost $960

  • A $7 pack of beer will actually cost $8.40

If Americans keep their credit cards in their wallets, purses - better yet at home - they would save hundreds and thousands of dollars a year in interest charges.

Some consumer debt can benefit people in the long run. An example is student loan debt; a higher education can actually increase a person's earning capacity. Credit card debt, however, adds no tangible financial benefit. Credit cards are like the fast food of currency - filling at first but bad for you nonetheless. Many people obtain multiple credit cards and lose track of their spending. These folks then seek credit help such as debt consolidation or other forms of debt relief. These methods help people get out of debt and eventually improve their credit score.

The Psychology Of Credit Card Use
No matter how much Americans charge on their credit cards, that piece of plastic never goes away. On the other hand, the more cash we spend, the quicker those dollar bills disappear from our wallets and purses.

The bad thing about credit card use is people never realize how much money they are spending - unless they are really diligent about their finances. The swipe of the credit card at the register is quick and easy, but by paying for items with cash, people become more aware of their spending habits. Consumers who use cash fumble through their billfolds to get the bills and coins to pay for their purchase. They might even pause to assess how much money they have left after the purchase.

There seems to be a faux glamour about credit card use. Advertisers play on this, showing images of fancy cars, fabulous shopping sprees and fantastic airplane getaways in credit card commercials. But the flip side of enormous credit debt is becoming more publicized. The documentary film Maxed Out explores the personal and financial tolls of rising credit debt. Rising home foreclosures and pressure on the subprime housing markets threaten the economy, leading to more headlines. One positive offshoot of American credit woes is that consumers are becoming more literate about how to manage credit and turn more to cash and savings for their purchases.

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About The Author, Brian Williams

Author bio: Brian Williams, a graduate of the University of Texas at Arlington, has 11 years' experience writing and editing at daily newspapers in Texas. Learn more about bad credit and debt relief from Brian through Credit Solutions. Credit Solutions is your alternative to debt consolidation.

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Hotline : Sales 6474 4005 | Marketing & Business Opportunities : 65942755 | (Mon to Fri, 9am to 6pm) Credit Cards Guide will provide you with all the information you need to know about credit cards. Find out about its advantages and disadvantages as well as how to choose a credit card that will suit your needs. Read about how to avoid credit card fraud and how you can steer clear of credit card debt. If you are already facing credit card debts, the guide will give you tips on how to overcome them. Learn how to use your credit card wisely so and reap the credit card rewards that come with it by visiting our Credit Cards Guide.