Credit Cards – Friend or Foe?

Is Everything Good Also Bad?

It is always amazing to me how two different people can make equally compelling arguments for completely different points of view. As an example, I might argue that everything that is good could also be considered bad. Take the gas powered engine for instance. Many argue that this has been man’s single greatest invention and has served as the catalyst for most of the world’s economic expansion over the past 100 years CVV shop. On the other hand, critics argue that this same invention has caused irreparable damage to the environment in the form of global warming and pollution. A simple search of the internet results in a fairly compelling argument from the opposite point of view. In his book “Everything Bad is Good For You: How Today’s Popular Culture is Actually Making Us Smarter”, Steven Johnson argues that those things considered bad are in many ways good for you. One example he uses is that video games are making children smarter. Studies show video games make people more perceptive, training their brains to analyze things faster. If you believe that everything good can also be bad and that everything bad can also be good, you will agree with my hypothesis that credit cards can be very good financial tools but, used inappropriately, can be very, very bad.

What’s Good About Credit Cards?

Let’s begin by exploring some of the good aspects of credit cards. Credit cards are ubiquitous financial instruments. That is to say that they create a tremendous amount of flexibility and convenience. They are accepted almost everywhere things can be purchased. For me, convenience is one of the most appealing attributes of credit cards. In addition, used wisely there are a plethora of ways credit cardholders can benefit from the utilization of credit cards. These benefits come in the form of “rewards” that are accumulated in the form of cash-back rebates, airline miles, hotel rewards and points that can be accumulated for merchandise. Most rewards are accumulated at a rate of approximately $0.01 in cash value for every $1 in credit card spending. If used correctly, this “reward” will not cost the cardholder anything. There are additional attributes of credit cards that I consider to be good attributes. They can be used to make donations to affinity groups. Some credit card institutions allow cardholders to donate a certain portion of rewards accumulated to a special interest group. Additionally, credit cards serve as a very reliable source of emergency spending capacity. In the event of an emergency where some type of financial outlay must be made, credit cards can usually be used to cover that outlay. Proving particularly valuable for large emergency expenditures where cash is not readily available. I could continue exploring the good aspects of credit cards but I am confident that I have appropriately made my point.

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