“Life was a lot simpler when what we honored was father and mother rather than all major credit cards.” ~ Robert Orben ~ Do you really need that plastic in your purse?
The Dilemma
Credit cards, some believe modern life isn't possible without them, others tell us we'd be much better off if we just paid off our credit cards and cut them up. Or even better, if we never even applied for them.
Who is right? The Pro Credit Card Brigade, or the Anti Credit Card Squad? Or could it possibly be that both are a little right and a little wrong?
Is having a credit card a luxury or a necessity?
When a Credit Card Spells Trouble
Some people are either not willing to or capable of making good financial decisions. They will spend any money they have the moment it's in their purse or on their bank account. They go on shopping sprees. They are impulsive when it comes to money and don't think before they buy. Who cares if they need twenty pairs of shoes? They just want to have this pair of shoes right now, and they can't wait to spend their money on them.
We probably all know someone like that, and call this person a shopaholic. Sometimes, there's more to it than just "shopaholicism" though. Your overspending friend or relative might be suffering from a mental disease, e.g. bipolar disorder. And to make things worse, your spend-thrifty friend is on disability and has hardly any spending money to start with.
Having a credit card could easily be the downfall of these people.
The Credit Card as a Necessity
As much as the critics want us to believe that a credit cards is just pure luxury, there are a few instances when having a credit card may not only be convenient, but even a necessity, or something very close to a necessity.
This can be especially true if you are self employed, and may at times need to buy more than you can pay for at the moment, but will be able to pay for as soon as your business sets off. Additionally, you might like the convenience of having a statement with all of your business spendings sent to you every month, if you use your credit card for all your business purchases – and for those only.
Also, anyone can run into some kind of emergency and need money right away. More money than you have in your bank account. Of course it's better to make sure you always have enough money for emergencies in your savings account, but you'll need to have money first to be able to save it, and you won't have a fat savings account overnight either. In case of emergency, having a credit card could be a life saver.
The Credit Card as a Luxury
In most cases, though, having a credit card is luxury – and there's nothing wrong with that as long as you can afford it and know how to use your credit card wisely. Ideally, you would look into your spending pattern before applying for a credit card, consider whether you need or just want it, and whether or not you will be able to use your plastic money responsibly.
Don't become a credit card addict.