Do you remember when credit cards were “prestigious”? – Well according to Jane Bryant Quinn‘s book, Making the Most of Your Money, the cool thing to do nowadays is pay off your cards. To do this, Quinn says, it all boils down to one principle:
Don’t borrow any more.
This is pretty simple. But according to Quinn, this is easier said than done. First off, you should probably stop using your credit cards – leave them at home and use cash or checks. The main idea here is that you’ll make it harder for yourself to sneak in new debts. Some people say that you need credit cards to buy things like airline tickets and rental cars. But, Quinn feels you should be able to find a way around most of these cases. For example, if you need a rental car, you can reserve the car with your credit card, but then pay with a paper check.
According to Quinn, once you stop using credit cards, three things will happen:
1. You will buy less. Whatever you buy will probably be less expensive. If you pay with cash, you find you become more stingy. The reason is that cash is “real” money, so how you think about spending changes. The result is you buy less and buy cheaper.
2. Your debt will shrink. The main idea here is since you’re not racking up new bills, your available cash will increase. This allows you to pay down your debt more quickly.
3. You’ll become smug and self confident. – Well, she doesn’t really mean this, but living debt free certainly doesn’t hurt your self esteem.
For my part, I like and endorse Quinn’s advice. The major problem with Quinn’s views on credit cards is the economy is increasing moving towards electronic transactions, so Joe average needs to have some form of electronic payment. For many Americans, this means credit cards.
So, if you have to pay electronically, feel free to talk to your bank and see if they’ll give you a debit card. Most new accounts come with debit cards, so they should give you one pretty easily. Debit cards have many of the advantages of credit cards, but don’t allow you the opportunity to rack up big debts.
For more on credit cards click:
Best,
James
