Credit Perspectives: Credit Cards Are Good
Filed under: Credit Cards
This is the first installment of Credit Perspectives. Please visit the introductory post for the other perspectives provided in the rest of the series.
The idea of credit has been around since before money was invented, but the invention of the credit card in the 1950s revolutionized our economy. Never before has it been so easy to access credit and never have we been so free to tap our potential.
By opening up and extending the consumer’s spending power, credit cards have allowed our economy to flourish and gain the capacity to host new businesses, new markets, and new business platforms. It could be said that e-commerce as a whole would be impossible without credit cards.
It appears that the world of commerce is evolving and cash is (rightfully) on its way out. Credit cards are the way of the future and you can count on them always getting easier to use with more reasons to use them. Even today, the benefits of using credit cards over all other forms of money are huge.
Cash Is Dirty
Cash is notoriously dirty. Just think of all the people you’ve seen leaving the restroom without washing their hands. Those same hands will soon be handling any amount of cash and spreading with it whatever filth they carried. A dollar bill changes hands around 223 times in its lifetime - that’s a lot of potentially dirty hands.
Cash Is Clumsy
Visa has run ads lately showing how (albeit unrealistically) efficient small commercial transactions can be: Just swipe your card and you’re gone. By fumbling through your wallet looking for the best bill to pay your tab or hurriedly filling out a paper check, you’re wasting your time and the time of the merchant. Not only that, you have to think of the space these bills take up in not only your wallet, but also the drawers of the merchant’s register. It’s far easier for everyone concerned to just swipe your credit card and go.
Cash Is Risky
Cash is the thief’s best friend. If your wallet is lost or stolen, you can kiss whatever cash you had in there goodbye. Heaven forbid it if you just stopped by the ATM! On the other hand, quickly reporting your credit card stolen ends the thief’s short buying spree and you’re on the hook for no more than $50 or even less depending on your card issuer’s policies.
Spending Other People’s Money
Whether or not you have the money to cover your purchases today, you still get to head home with the spoils. For a few days or even a month, you’re earning interest on your hard-earned money instead of it sitting in the pockets of an uncaring corporation. When the bill arrives, you should pay it in full and pocket the interest gains from the “generous” credit card company. Until then, hold the money in a high-interest online savings account and enjoy your free money.
Recommended Online Banks:
- ING DIRECT - High Yield Savings with 3.00% annual percentage yield!
- Earn 3.30% APY with E*TRADE Bank
Rewards Are Money In My Pocket
Credit cards are great, but they’re not all created equally; the best cards reward you for using them. For example, my credit card gives me anywhere between 1% and 3% of my purchase amount back every month depending on where I shop. Basically, they’re paying me to do what I would have done anyway! Before you sign up for a credit card, check which ones will give you the greatest benefits and take advantage of their offers.
Recommended Rewards Card:
- Get the Discover® More Card - Up to 5% Cash Back
It’s easy to see the positive effect credit cards have had on our economy as a whole. So much more is possible today that couldn’t have been without credit cards. Don’t let the detractors scare you, this is the way of the future and you need to be ready to embrace it today. No longer is there any reason not to join the revolution and use plastic for all your purchases.
July 8th, 2008 at 12:47 pm
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July 9th, 2008 at 12:00 pm
Good points, all of them. I use a debit card to get around a lot of the cash ickyness and hitches that you mention. Also, last time I checked my main debit card, it was supposed to have certain protections as well in case it got stolen.