The Dangers of Credit Cards

The Dangers of Credit Cards

TITLE

Thesis Statement: I am most interested in the topic Dangers of credit cards and how they affect our lives.

INTRODUCTION

Credit cards debt is a common problem in America. It’s a tricky beast that poses specific dangers. Most of us have experienced this first hand and are in the process of getting it under control. According to the Consumer Financial Protection Bureau credit cards didn’t play a major role in our consumer spending until the 1980’s. A couple of years back when I first came to the United States, my uncle whom I lived with first warned me about the excessive use of credit cards. I didn’t understand him back then, but as time went by I fully understood what he meant.

Even if you think you’ve got it all under control, there are still some dangerous things about using credit cards that might be affecting you. In my speech I will be looking at four dangerous things about credit cards and how to get them under control.

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1. They Make It Effortless to Spend Money

Credit cards are often mistakenly thought of and used as extensions of our income, but just because we have a certain credit limit doesn’t mean we are free to purchase whatever we want. I was warned earlier about it but didn’t really understand it, as the saying goes “experience is the best teacher”. I understood it fully by being a victim of it.

Its unfortunate that credit cards make it all easy for us to spend money, but it’s the truth. We tend to purchase things without thinking of how we’re going to pay for it when the bill arrives.

1. How to protect yourself: challenge yourself to only using debit cards to make purchases for the next 14 days. When you go to the grocery store or out to eat, leave your credit cards at home and use your debit card, or cash instead.

1. Everyone Else Is Using Them, So You Feel You Should Too

Statistics shows credit cards didn’t play a major role in our consumer spending until the 1980’s. But society have quickly become dependent on them and crafted our spending habits with them in mind. Nowadays, 72 percent of Americans have at least one credit card, with the average being three credit cards or more.

The peer pressure makes it easy for us to use and rely on credit cards, since it’s such a commonly accepted idea. Not only is using credit cards socially acceptable, but so is having debt. However, if you want to build wealth and save for the future, you need to understand your own spending habits and money personality. If you’re a spender by nature, having access to high credit limit could be cause for a financial disaster.

A.  How to protect yourself: evaluate the way you handle money and do some experiments on whether it’s smart for you to use credit cards. Pay attention to what your friends are doing and see if their behavior is indirectly influencing you to spend more or swipe that credit card more.