February 23,2009
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News: Credit Cards: Who needs ‘em?
Probably no one. However, if we qualify ‘who' to mean ‘of those who prefer a better lifestyle', then the answer might be "Most people". When used responsibly, credit cards generally offer:
- A large ‘lever': Credit cards can multiply the effect of a person's resources.
- Better terms: Credit cards can avail much better terms toward a home loan or car loan. Credit cards allow access to purchase major items like large-screen HDTVs in Miami or even replacement of a broken water heater in mid-winter in Sioux St. Marie.
- Immediate buying power: Credit cards offer the ability to make large purchases on the spot without having to save up for months in preparation.
- Cash-flow liquidity: If you're worried about that utility bill payment beating your paycheck to the bank by a day or two – don't. Many utils can be paid with credit cards.
- Safety: Carrying a lot of cash is dangerous and risky. With stolen credit cards, your liability is only $50. Generally is doesn't cost you a dollar, if one is stolen and even used. Checks are getting less and less friendly. I've had travelers' checks denied because I was traveling (duhh?).
- Reservations: If you still have reservations then stop right now. Obviously you have no class or style (joke). But seriously, even those not in the jet-set have cause to fly, rent a car or make hotel reservations occasionally. Credit cards are, by far, the most accepted way.
- Convenience: I presented a traveler's check for the Chunnel (from France to England) and the travelers' check became committed to the transportation authority. After a long wait, I was told that they could not take a traveler's check (even though they had made it unusable any more). I had to make payment with my credit card to get a ticket. Meanwhile, they agreed to compensate me for the $75 USD traveler's check in Franks – coins, not notes. So there I was with 25 pounds or so (not ‘currency pounds', but weight) in my pocket to the point I had to use one hand just to keep my pants from falling down from the weight, as I rushed around with my luggage. Leaving France with coinage meant I could not convert them back to dollars (foreign exchanges here accepted only notes – not coins).