Credit Cards

Using credit cards
???Modern man drives a mortgaged car over a bond-financed highway on credit-card gas??? (Wilson, 2010). Today this quote, written by a professional baseball player Earl Wilson, accurately depicts what Americans are doing to obtain items that they believe they need to fit into their places in the world. The world has begun to depend greatly on the use of credit cards to purchase items that they believe they need but can not normally afford on their regular earnings. The state that Americans have gotten themselves into because of credit cards has brought upon the question of whether or not the use of credit cards helps or hurts people in their lives. The question that the American population needs to consider is if the pros of possessing and using a credit card outweigh the cons that card can bring. Even though credit cards are an easy way to raise credit score, most Americans should not use credit cards.
A disadvantage that most people overlook when they think of credit cards is the higher risk of identity theft. A common misconception that a credit card provides no worry about the loss of cash or money when misplaced or lost, but a lost credit card is in ways worse than lost money or cash. If someone loses cash he or she are only out the amount of money, but if he or she lose his or her card or even have his or her account or card number stolen he or she will have to worry about the damage it can do. After he or she stops the card from being used, the identity theft can still hurt them in other ways such as their credit score. There are other ways that a thief can obtain the account and card number than just by steeling the card. A thief can obtain the information through an Internet or phone transaction, through thrown out statements that contain viable information, and something as a simple bump or peek at a card while standing inline. Handing the card over to a teller for payment is even considered a theft risk especially when they leave with the card such as in restaurants. Once a thief has this information, they can charge up the card, give the information to others, and even use the name and number to create themselves a new identity. This will affect the card holder in both possible repayment and a damaged credit history and score (Britannica, credit card 2010). Fixing the effects of identity theft can be a long and hard process with the possibility of not getting everything fully fixed. The advantage some people think that credit card will help boost their credit history and score can all be taken away with a simple act of identity theft.
People, who think that a credit card will help boost their credit history and score faster than any other method, are often not able to reach their goal simply because they do not fully understand how a credit card works with their terms and conditions. A credit card can hurt them more than they will help them. A common misconception about credit cards are that they are money, but in reality are a type of loan that has terms and conditions that need to be met to reap the full benefits it can provide. Credit cards are, in fact, the most expensive way to borrow money (Bajtelsmit & Rastelli, 2008). People often fall for the deceiving catch of rewards on a credit card, which are more like a trick to get them to spend more than they would in the first place just to get more ???free stuff??? (Bajtelsmit & Rastelli, 2008). The most common overlooked term and condition of a credit card would be what happens when the monthly minimum payment is not paid or when only the minimum payment is paid. People seem to believe that their payments are taken off their outstanding balance, but they are applied to interest and fees first, than the reminder amount is taken off of their balance. Considering that the average American spends18% more with a credit card than they do with actual cash and 43% more than their concrete earnings is an example that they do not understand what the purpose and intent of a credit card should be used for (Moran, 2009 and Ophoven, 2009).
The result of Americans spending 43% more than their earnings with credit cards is the national credit card debt reaching $2 trillion, which is the biggest reason most Americans should not use credit cards (Moran, 2009). With America being the nation with the highest amount of national debt in the history of the world it comes to show that the American people do not know how to handle his or her finances responsibly (Moran, 2009). People fail to understand what the cause of falling behind on payments or the inability to pay the monthly payments can result in large penalty fees and quickly falling into default on his or her credit cards. That will make it hard to catch up on his or her payments that can put him or her into debt (Britannica, 2010). Possessing and using a credit card makes it easy for someone to make a bad purchase decision quickly (Ophoven, 2009). The result of irresponsible and unknowledgeable Americans using credit cards is an average household credit card debt of $8,000 (Moran, 2009).
Credit cards are causing more problems for Americans than they are fixing. Most Americans do not realize that credit cards bring a higher risk of identity theft that can ruin the credit that they were trying to build up with the use of credit cards. If Americans did fully understand the terms and conditions of credit cards then they would probably choose not to use them because they are the most expensive way to borrow and make it easier for them to spend 43 percent more of there earnings with them. Because of the overspending with credit cards, Americans currently have an average credit card debt of $8,000. Even though credit cards are an easy way to raise credit score, most Americans should not use credit cards. The situation that Americans have gotten themselves into today comes to show that they should have followed the American saying of, ???In God we trust; all others must pay cash.???

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