Me and the Credit Card

I am excited. I am sitting in a coffee shop writing this. Do you know how long I have wanted to do that? It always looked so great to me, all those independent people, sitting with their coffee and laptops, just writing away.  And here I am. Well to be totally honest, it is quite noisy, the table is too tall for comfort, the coffee costs a third on my Nespresso, but it is still exiting – and the cookie is really good! (And Dear Husband is still sick with the flu at home, if you know what I mean? ;-))

 

So back to business. Do you remember the old days? When you had to actually go to the bank to get some money and when there was no more money on the account then that was it? (Yes, I am actually that old, although I don’t really remember it myself). Today we have so many ways to manage our money. Some are really good and make our lives easier and some are great for getting people in trouble.

One of the big inventions of the last decades, money wise, has to be the credit card. I have written a bit about how we use the envelopes in earlier post, but that doesn’t mean that we do not use the credit card. I personally think it is a great thing as long as it is used wisely.

Here is have listed some of the pros and cons of the credit card.

Pros:

• Accessible and easy to use – can be used almost everywhere in all currencies.
• Good for emergencies
• Allows bigger purchases
• Helps record expenses
• Safety – can easily be cancelled if stolen

 

Cons:

• More spending – the accessibility makes is easier to buy
• Interest and fees – especially when paying in instalments
• Irresponsible spending – using money you might not have
• Using for emergencies – instead of an emergency fund (I will write more about this in another post).
• Safety – can be misused if details stolen

 

We use the credit card for purchases on the internet and for travel. We also use it for all our regular expenses as electricity, municipal taxes, etc. We try to avoid paying in instalments as much as we can, but use it on a few expenses like the car insurance as it is an expenses that covers the whole year.

So, my bottom line is; credit cards are great as long as they are used right. I still recommend having a budget in mind when using it, still think twice before buying anything, make your internet bank your friend and track all expenses also on credit card spending, and never ever pay for frequent reoccurring expenses (like groceries) in instalments!

That’s it. Home to make some more tea…