I’ve never had a credit card and I’m not about to start now. Here’s why.
A few years ago I went to the bank just to see if I was eligible for a credit card. I was a full time arts student at the time, which basically means I had about 12 hours of philosophy and gender studies classes each week. Turns out the bank didn’t mind, and they were pretty happy to give me a limit of $18,000. Correct. $18,000 for a full time student. Not knowing I didn’t have to take the limit they gave me, that number scared me into changing my mind and cancelling the application. Which was a great move, because who knows where I’d be today with all that money to burn and time to kill back in 2007?
It’s no secret that banks want your cash and offering insane credit limits, coupled with extensive fees and high interest rates, all help keep them rich. Not having a credit card is my little personal protest to not give them any more money they don’t need.
I’m An Impulse Buyer
There’s nothing that excites me more than product placement. Cherry Ripes at the supermarket counter are my most frequent purchase, followed closely by paw-paw lip balm at chemists and killer pythons at servo stations.
Having a debit limit (whatever is in my account) keeps these purchases small, so more money available means these impulse buys will quickly turn from Cherry Ripes into Louboutins.
I know my weakness and I’m not fuelling the spending fire. Add things like earning points and flights for a minimum spend, and I know I’d say goodbye to money I wouldn’t otherwise, just to get a “free” flight to Albury.
It’s A Slippery Slope
A friend of mine used to get a new credit card for the sole purpose of paying off her other credit cards. One card quickly turned in to five, along with a new car, cosmetic surgery and lifestyle she couldn’t afford. Add on top of that an expensive wedding, and a lifetime of debt is looking pretty likely.
Now, while I’m safe from the temptations of cars and cosmetic surgery, it’s easy to see that this downhill spiral all started with one card. And that’s one card and one risk I’m not willing to take.
I’ve Never Needed It
I’ve always been able to pay for flights, tickets to festivals, holidays or medical stuff with savings or an emergency stash. Despite being prone to an impulse buy or two, I’m actually pretty good at saving for things I want. It might mean holding off on buying something until pay day, putting self-imposed bans on visiting bookshops, or dipping into savings to pay for a jaywalking fine. Yep, that happened.
As for a credit history, paying bills on time, having regular salary paid into the same account and building up savings are all pretty important too.
I’m sure for the right person with the right card and right rewards program, credit cards can be convenient. But it’s going to take a lot of convincing for that person to be me.
Have you been well rewarded or whacked for six by a credit card? We’d love to hear your two cents.