Cut up your credit cards! (Credit Cards in general)

Member Name: bruffyboy

Product:	Credit Cards in general
Date:	21/02/09 (50 review reads)
Rating:

Advantages: as listed

Disadvantages: too easy to mess up on

There are some good points to credit cards:

1) You can use them to buy from places that don't accept bank cards (including many websites).

2) You can use them (wisely) to buy things so you don't need to carry cash around (same as a bank card).

3) You can buy things such as flights, and get your money back if the flight is cancelled (which doesn't happen with cash).

4) You don't get charged any interest if you pay the full balance at the end of the month, so by using them wisely you can buy things a short while before you have the money, and not pay any interest.

The main problem for me, with credit cards, was that it was too easy to charge things to them. For example, I had enough cash to live on, but when my car's MOT came up, I put the £300 bill on the credit card. Same with the insurance, road tax, occasional garage fees, one or two meals out, the odd birthday or Christmas gift etc, and before you know it, you're £9000 in debt (like I was).

We've all heard the depressing stats about credit cards, but let me remind you. If yu have £5000 on a card at 17.9%, and only pay the minimum 2.5% per month, it will take you 18 years to pay off the balance, in which time you'll pay £11500 in total.

The simple truth is that effective use of credit cards requires self control that is beyond most of us. I have just about cleared the mountain of debt I built up, and I can honestly say that the only way to live is to save up for things, and only buy them when you have the money.

A word of warning: 0% interest offers can be taken away if you are late on a payment, so don't take them for granted.

In conclusion, credit cards are too easy to mess up with. The credit card companies only make money if you don't pay up quick, so don't let them win!

Summary: cut them up!