There are many personal finance blogs that tell you to cut up your credit cards or exercise greater willpower with credit cards. While that may be good advice depending on your situation, I want to personally thank the countless people who are irresponsible with their credit card usage.
Without the huge profits that these people are generating for credit card issuers, we would all be paying annual fees and higher interest rates. Cash back rebates or airline miles would be virtually nonexistent. So from the bottom of my heart wallet, thank you!
Charging What You Cannot Afford
Amazingly many people treat their credit cards as an extended bank account. No money in the bank for those new shoes or dinner out with friends? No problem! Just charge it to your credit card!
The problem is that you can get carried away with this thinking. Suddenly you are financing the lifestyle you dream of. Then once you are used to that lifestyle, you want to maintain it even if it means racking up your credit card.
Before you know it, you have a credit card balance that you cannot pay off. With the high interest rates of credit cards, this can be disastrous. Continue reading