Okay, the hottest thing going today, in the financial realm, is the “Cash Back” credit card. Almost every major credit card issuer is offering one of these “wonderful” things, promising you cash back for the purchases you make. Some promise cash back for groceries, gas, or everyday purchases. You can get bonus miles, bonus cash, and bonus gift cards. Wow! These things are wonderful…

Hmmmmmmm…

Get real. These things are CRAP. Why? Because, when you use credit cards, you are using a form of payment which is not “real”. Whenever you spend real cash, you “feel” the transaction. When you use credit, you don’t “feel” the money leave your pocket. Be honest… Which is easier? Handing someone THREE ONE HUNDRED DOLLAR BILLS for a new digital camera, or swiping a credit card and creating a debt of THREE HUNDRED DOLLARS? You know the answer. It is MUCH, MUCH, MUCH “easier” to use credit. Why? Because there is no emotional connection to the transaction. Credit card companies are not stupid. They know that the deals that they are offering you SOUND GOOD, but in the end, they are out to MAKE MONEY. My advice. PAY CASH. Feel the money leave your pocket. Watch it go into the money drawer. (Even using a debit card, which I do for various purchases, is easier than using cash.)

Now, there are several arguments against my position. I will list a few here, so that you don’t have to:
But ncnblog, I’m responsible with my credit and I pay off my balance each month.
But ncnblog, I was going to buy these things anyway, so I might as well get some cash back.
But ncnblog, I know how to handle my money, and I always make all my payments on time, and I am never going to be late or miss a payment. Relax.
But ncnblog, Credit cards are “safe” and they provide protection for me when I buy a product.
But ncnblog, Etc. Etc. Etc.

I hear what you are saying, and my response is…

Get real. Credit cards, for most people, are extremely addictive. They create a false since of security and a false prosperity. Here are my retorts:
I am glad you pay off your balances, but people spend MORE with credit cards than they do with cash. (Be HONEST, and think about how YOU are with your credit card!)
I am glad you were going to buy these things anyway… But, are you being totally real with yourself? On occasion, don’t you purchase items with the thought in the back of your mind… “Well, I don’t really need this, but I will get some cash back, and I might use it…”? Ladies, go check your closet for that purse or pair of shoes you charged, and think of how you justified the purchase… Guys, go out to your shop and look at that tool or gadget that you just had to have. If you did not have a credit card, would you have purchased those items…? BE HONEST.
I am glad you know how to handle your money… But, what if a payment gets lost in the mail, or the bank messes up, or one of these mega-banking corporations just arbitrarily decides to up your rate, or change your card policies? Oh yeah, that will NEVER happen, because these guys are known for their honesty and integrity.
Last, the “protection” part of using a credit card. Have you ever tried to dispute a charge on a card, or use their warranty protection services? If the answer is YES, then how did they do? I hope they treated you well, answered your service calls, and stood by you. In the answer is NO, then you have been relying on something for years and years, and never have had opportunity to use it. The “protection” afforded by credit cards is like the “protection” provided by a pet rattle snake. I would MUCH rather do business with honest people, with cash, and have my disputes and troubles handled face to face. (Why would you do business with someone that you would need protection from, especially protection provided by Visa or MasterCard?)

I know this post flies in the face of most pf bloggers, and that is cool. Most people talk of good debt and bad debt… blah, blah, blah. The borrower is slave to the lender…Whether the slave master beats you, or treats you like a member of the family, he’s still your master. And even the most benevolent master can turn around and break your neck.