Call Your Credit Card a "Plastic Check"!

By Sarah Baughman. Last updated 31 October 2012. 6 comments
Photo: Brett L

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I was probably the only fifth grader I knew with a checkbook, and definitely the only one hunched over the dining room table trying to balance the numbers every month. Sure, I would rather have been watching Saturday morning cartoons, but this was my mother’s requirement: I had to learn, at a tender age, how quickly money slipped through my fingers and how important it was for me to keep track of it. (See also: How to Financially Educate Your Children)

When she signed me up for a credit card, hoping to reinforce similar principles, my mother conditioned me to think of the credit card as a checkbook. Knowing the end of the month would bring a bill and an ensuing check written out for whatever I’d spent, I never felt the thrill of freedom that courses through many people’s veins when they get their hands on that piece of plastic. Instead, I felt something more like fear.

Credit cards seem to have been specially designed so people can live outside their means and suffer for it, but you don’t have to use them that way. Many credit cards have a great advantage over checkbooks; they offer tantalizing points systems that award you monetarily as long as you pay up. I use my two credit cards to get more than what I originally paid for by working up to a free plane ticket or a cash bonus, but as a rule, I never put anything on a credit card that I couldn’t write a check for that week.

My husband and I made some major life purchases this summer, the most costly one being a bedroom set and mattress. My husband somehow convinced me to let those charges sit on our credit card because our savings investments will make more interest in a month than our credit card can charge. Mathematically, I saw his point, but my trepidation at the “slippery slope” of credit card debt trumps what many might deem simple financial logic. Ultimately, I’d rather dip into savings to get rid of that nasty figure on the card statement, then replenish our savings from our paychecks. At least I’d be “balanced” at the end of each month, and mom’s not the only one who would be happy about that.

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any card issuer.

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Guest's picture

sometimes i use my credit card and spend more than i can pay off in a week. but i make sure i pay it totally off by the end of the month - as long as it's a short time period, within which interest can't accrue, i think using a credit card won't extend you past your means.

Guest's picture

Using a credit card never really made me realise how much money is being spent. I only had a vague idea, most of the time I was fooled into thinking that was just 10 dollars today and 25 yesterday for groceries. It quickly adds up and you dont realise it like how you would if you had cash dissapearing right infront of you. Only when I started budgeting I realised that I spent way too much than I had by almost 500 dollars. Then I started keeping a spreadsheet that forces me to actually "SEE" where my money is going to. Now before I go for groceries, I tell myself that this week I can buy within 30-40 dollars, and that helps to put a boundary to my having a fence. Sure sometimes it goes more than that...but it helps curb the unnecessary expenses.

Guest's picture

Using a credit card can be GOOD. But some people have a very hard time learning so it's only for some of us. I always use my card like you, to build up my rewards and I end up using the bonuses this time of the year to buy christmas gifts and stuff. Or I give away my gift cards. It saves me from having to buy so many gifts.

I too, sometimes spend a little more that week than I have on a credit card but I also make sure it's paid completely by that billing period so it doesn't incur interest. :)

Carrie Kirby's picture

Charges less interest than your savings account accrues? I want your credit card -- or your savings vehicle -- or, actually, both!

Guest's picture

I refused to get a credit card until I was 24. When I got it, I had the same experience...a tinge of fear not ecstasy. Up to that point I paid cash or check (or sometimes Money Order) for everything. The only reason I got the CC was out of convenience, to enable online shopping, and to establish credit so I could have a better rating when I eventually went to get a mortgage on a house (I was determined to never pay rent after I graduated college). Now I use the CC like a "check" card, I never carry cash and only write checks for bills. And I pay of the balance in full every month. I've never had a finance charge, heck I don't even know the interest rate on the card because I don't care. Paying interest on the balance is not an option, it doesn't happen, just like you don't bounce just doesn't happen. Now the bank on the card has tried hard to get me in debt, sending counter checks or 5k-10k loan offers. I just tear them up. Some people tell me to use a debit card instead of a credit one. However I think a CC is more secure in many ways. If the card is stolen and rung up, once you file with the CC company they dispute all the charges for you and can refuse to pay. I'd rather have a huge CC company run interference for their money I've used rather than have my bank balance used fraudulently and try and get it back (because I can't pay the mortgage with invisible money not in the checking account). Plus you can use that month grace period as a 30 day 0% loan to cover the unexpected like car problems or an expensive appliance, like a furnace, that goes on the fritz. Then adjust your budget to pay if you need for a month to get it paid for. I think the bottom line is that with a CC you need to be responsible and train yourself to live within your means.

Guest's picture

It is so amazing how people can spend mor emoney with plastic then money!