Does Using a Credit Card Demonstrate Financial Literacy?

[Fatunad]

Financial intelligence is demonstrated in how we handle our financial responsibility and how we place our scales of preference on things that we tend as necessity, want and also what we classify as luxuries because you can afford to be luxurious with debt and at most, the only reason to take loans should be for starting up something new,  and that thing being able to service the loan on it own,  so why then should I spend too much using a credit card that I know is not my money and also I get heavy interest on that money,  and if that be the case then I will only spend the amount I know I will be able to afford to on my own,  that is the reason I prefer using cash or my own bank cards mostly debits cards.

I have never had a credit card all my life,  and I don't intend to have any for a long time probably forever,  because I will make sure to build my expenses around my budget and income per month.

But once you do have a credit card then you could really be able to make up some transactions if you are short in fiat but if you do see that you could be able to sustain yourself without credit card then it would really be just that so fine that you wont really be needing one but for me then it is really that something helpful if you are really just that mindful about paying up your dues. Myself does have that having those past problems about credit cards on which i do really end up on struggling on paying because of having those missed payments on which it did really give out those kind of penalties which ends up on being compounded until you would really be falling into the pit of debt on which getting out would really be never be that easy.

The good thing about on having credit card is that you could really be able to transact things or making those purchases even if you dont have fiat on your pocket which it is really that convenient.
Interest arent really that high though as long you do know on how to pay  your obligations but if not then expect that this is something that would really be happening.
Common sense you would really be needing in terms of handling up yourself into the right path. Spending isnt bad as long you are really that responsible on repaying those dues.
People do usually mess up their lives because of the wrong decisions that they had made.

[Juse14]

A credit card will only be useful and helpful when the card is used by the right and wise person. Of course, the presence of this credit card makes it very easy for us to carry out transactions because with a credit card we don't need to bother carrying cash when shopping in large amounts and the presence of a credit card can also help us in times of urgency, helping us to meet our needs. when we don't have enough money to meet these needs. because with a credit card we can make a loan without collateral. However, this can be inversely proportional when this credit card goes to the wrong person and is careless in doing something. The presence of this credit card could have bad consequences because it could allow someone to behave carelessly, namely shopping without any restrictions and doing this just to fulfill their desires, so that in the end this will only make someone become in debt.

bottomline, you can only appreciate having your own credit card if you are responsible enough in managing it. but a nightmare if you happen not to control your spending habits.
for me, it is better not to use credit card at all, at least, there's no temptation. most of what we buy usually is the product of our impulses.

Everyone has their own choices and views in assessing something. If the presence of this credit card can harm and endanger yourself because it will only lead you to a bad behavior. then the decision not to use a credit card at all is the right decision.
I personally think that the presence of this credit card is very useful because it can help me when I am in a fairly urgent condition and I think that I have good enough self-control so that in using this credit card I can use it wisely. Another reason why I use credit cards is because I am well aware that I do not have enough savings to be able to answer when I have an urgent need. And maybe I will only stop using this credit card when in time I already have enough savings.

[freedomgo]

Credit cards are often associated with the wealthy who can pay off their entire balance while benefiting from various rewards and points. However, for those with limited financial means who can only afford to make the minimum monthly payment, it can lead to long-term financial problems, especially if they continue to overspend, resulting in a never-ending balance. Credit cards are essentially tools that offer convenience in spending, eliminating the need to carry large amounts of cash. Therefore, it's essential for individuals to carefully evaluate their financial situations before obtaining one, considering whether it genuinely enhances their financial comfort or merely adds to their debt burden.

In a simplified explanation, while the wealthy enjoy convenience from credit cards, which credit card companies don't profit much from, it's often the less fortunate who are essentially financing the operations of credit card companies, allowing the wealthy to continue benefiting from their services.

[poodle63]

Being "debt-free" is not as good of a thing as one might think. Sure do not have debt that you can't pay, limit your debt to amounts you can pay, but also use debt to grow as well. I personally have a credit card AND a loan that I am paying, but thanks to those I have purchased stuff that I couldn't ever get with cash, in an inflationary nation like mine, spending money today with credit card means that by the time my debt is over, the price of the product will be huge. So if you use your debt smartly then you are going to be fine, but if you go into debt without knowing what you are doing and just a shopping spree like an addict, then obviously your debt will ruin your finances.

that is using credit card wisely most of the time some people use credit card to buy luxurious things, in which actually is fine though if the luxurious stuff is some sort of investment that could grow but if its going into some restaurant spending thousand dollar just for eating which next day become feces then its as good as just trapping themselves into the debt.
credit card is good if taken advantage properly but there are many misuse of it.
sometime the fact that credit card, requires us to pay fully at the end of the month to get good credit simply means that its really is just good for holding off payment until sometime and then pay it in full.
which simply means we can afford it in the first place, but delaying it to keep the cash flow from disrupted.

[TimeTeller]

Credit cards are often associated with the wealthy who can pay off their entire balance while benefiting from various rewards and points. However, for those with limited financial means who can only afford to make the minimum monthly payment, it can lead to long-term financial problems, especially if they continue to overspend, resulting in a never-ending balance. Credit cards are essentially tools that offer convenience in spending, eliminating the need to carry large amounts of cash. Therefore, it's essential for individuals to carefully evaluate their financial situations before obtaining one, considering whether it genuinely enhances their financial comfort or merely adds to their debt burden.

In a simplified explanation, while the wealthy enjoy convenience from credit cards, which credit card companies don't profit much from, it's often the less fortunate who are essentially financing the operations of credit card companies, allowing the wealthy to continue benefiting from their services.

I am not against with having credit card so long you are being responsible about the use of it.
Because there are so many conveniences that it will provide to you especially in tight situations where you forgot to bring your cash or you are out of cash.
But if you don't want to worry about having debt to these financial companies, much better to use a debit card.
At least, you know you are spending your own money and you don't have to worry about forgetting your due date for your credit card.
Also, it will teach you how to manage your finances without incurring debt to any of these companies.

[Strongkored]

What are your thoughts on this stance?

Most of what happens is like that, and that's what I also experienced, but not with credit cards but with the pay later feature which is currently available in many marketplaces, this feature makes us brave enough to shop without first looking at our financial budget, so that when we receive our salary we make dizzy because we have spent more than we should and what's worse is that the high interest means we spend a lot of our money on that.
Credit cards can actually be useful when we can use them carefully and that's what I did when I started a business and needed important tools to buy them with a credit card, so use a credit card only for important things, not to buy unnecessary goods, but what is better is to give up everything, meaning not having a credit card or using the pay later feature which is more damaging because getting it is easier than a credit card, and the interest is more unreasonable than credit cards, and not having both will allow us to refrain from shopping for things that are not important because we will only buy when we have cash.

[freedomgo]

Credit cards are often associated with the wealthy who can pay off their entire balance while benefiting from various rewards and points. However, for those with limited financial means who can only afford to make the minimum monthly payment, it can lead to long-term financial problems, especially if they continue to overspend, resulting in a never-ending balance. Credit cards are essentially tools that offer convenience in spending, eliminating the need to carry large amounts of cash. Therefore, it's essential for individuals to carefully evaluate their financial situations before obtaining one, considering whether it genuinely enhances their financial comfort or merely adds to their debt burden.

In a simplified explanation, while the wealthy enjoy convenience from credit cards, which credit card companies don't profit much from, it's often the less fortunate who are essentially financing the operations of credit card companies, allowing the wealthy to continue benefiting from their services.

I am not against with having credit card so long you are being responsible about the use of it.
Because there are so many conveniences that it will provide to you especially in tight situations where you forgot to bring your cash or you are out of cash.
But if you don't want to worry about having debt to these financial companies, much better to use a debit card.
At least, you know you are spending your own money and you don't have to worry about forgetting your due date for your credit card.
Also, it will teach you how to manage your finances without incurring debt to any of these companies.

Handling a debit card is similar to handling cash, but it involves digital currency. This discussion doesn't really compare debit cards and credit cards; it focuses solely on acquiring a credit card and its potential benefits.

According to the definition of 'financial literacy,' it means making wise financial choices. Getting a credit card when you're low on cash or just want to borrow money may not be a wise financial choice for people with limited funds, because the penalties for missing payments are high.

[Cookdata]

Do you believe that someone who exclusively uses cash for their purchases rather than credit cards is demonstrating financial literacy? Many argue that people tend to be financially reckless when using credit cards, often forgetting that it involves borrowing money. In various Netflix TV shows depicting individuals in debt seeking advice from financial advisors, the most consistent suggestions for getting out of debt are usually to cut up their credit cards and transition to making cash payments.

Individuals who avoid using credit cards tend to have a higher probability of being debt-free, showcasing financial discipline, and experiencing greater satisfaction compared to those reliant on credit cards. What are your thoughts on this stance?

Have you thought about how some family don't have a choice but to live with credit cards all their life? People who will request for debit card will do, it is not about financial literacy. Checked vividly, when people have more basic that are more than their income, then credit card is the only way they can sort out emergency needs because banks know what you earn monthly, and they can easily borrow you than another financial system that may delay you. When a person has a budget deficit, credit cards are inevitable because your net income is less than expenditure, how do you think it is easy to live that life when there are more needs at home?

I don't have the statistics but it is even difficult to see a single person use a credit card except for those that are living life above their pockets. Most often, it is those who have more kids with less pay and have more responsibility at home. The house will be on the mortgage, the kids are there to be paid for school fees, and the wife probably is doing nothing than to help do domestic, the only way out for that time when the income is low is a credit card because you can't avoid basic needs. Banks might be benefiting all from this but this is difficult for some people to ignore.

[philipma1957]

For me, it still depends. There are people out there who can maximize the benefits of using credit cards. And I think they're the smart ones. Not all people who uses cash instead of cc are financially literate but for me it's the other way around. But not all people who uses cc are smart with using it. Credit is power, if you know how to properly use it. But if you're just using your credit card to buy the things you want without really thinking if you can pay for it, then you're just making yourself to be buried in debt. There are a lots of perks and benefits when using credit cards. And as long as you pay on time, have a good credit history, and can maintain a good status, then you're using your credit card properly.

They're not just pieces of plastic; they're tools, powerful tools. Using any tool depends on how you utilize it. Absolutely, credit is power. Modern economic and personal finance power. But enormous power comes with... responsibilities. Some wise folks maximize credit card benefits. They pay on time and receive perks, cashback, and miles. Always on time. That's smart. It's financial literacy. However, I've seen people swipe without thinking. They purchase, buy, buy, and get deep into debt. Nothing wonderful about it. Credit cards offer rewards and advantages. They're not free. You must be incredibly smart. Keep your credit score high by paying on time. You're utilizing credit cards correctly if you can accomplish that. The sensible way. This is how you win personal finance

Exactly correct they are tools much like a chainsaw or a sledgehammer.

Use them properly they are helpful. Use them improperly you are fucked up.

Now I know people that will never use a chainsaw as they feel they will fuckup and hurt themselves.

Me I climb trees or ladders and hack away. I am not a lumberjack but I have felled 50 foot trees safely.

Saved a lot of money doing them myself using good safe methods.

But I know wrong shit can happen using a chainsaw. Just like I know you can fuckup using a cc.

I have use both safely so far.  I just got a card last month.

A 18000 line of credit 12 months interest free and a 900 dollar refund if you charge 6000.

I purchased four miners for 8000. right before price of btc went from 27k to 35k.
I made a threehundred dollar payment and got my 900 refund used that to pay for the card.

so i am down to 6800 debt with 11 months to pay.i the machines do 30 a day 25 after power cost.

So in 300 days they should have earned 7500 which will mean card is paid off. And I own four machines never laying out one dime to get them.

[summonerrk]

Do you believe that someone who exclusively uses cash for their purchases rather than credit cards is demonstrating financial literacy? Many argue that people tend to be financially reckless when using credit cards, often forgetting that it involves borrowing money. In various Netflix TV shows depicting individuals in debt seeking advice from financial advisors, the most consistent suggestions for getting out of debt are usually to cut up their credit cards and transition to making cash payments.

Individuals who avoid using credit cards tend to have a higher probability of being debt-free, showcasing financial discipline, and experiencing greater satisfaction compared to those reliant on credit cards. What are your thoughts on this stance?

I think there is no difference - spending cash or money from a credit card. Both are a waste of money. In order not to be a spender, you need to have a special mindset. For example, my thinking changed a lot after Robert Kiyosaki's book Rich Dad, Poor Dad. I immediately realized that money is not an element of what allows you to buy. And the fact that money is a tool for earning even more money. Therefore, you need to save and save, and if possible, buy bitcoin cheap and sell it for a high price. It was then that I learned the technical analysis of prices, and the concept of Compound Interest.

[el kaka22]

We are talking about "preference" here but forgetting that there are people who have no other choice. Yes, it is obvious that if you spend debt on things that you do not need that's bad, but that's already obvious, doing drugs is also bad, should we tell that too? Some things are just way too obvious and should go without stating.

However, if we are talking about something more serious, like how credit card could be used, then we need to realize that some people are so much in trouble, even without spending on luxury or useless stuff, they just do not make enough to pay for their life misery, and they just find themselves forced to use credit card. That's why credit cards exists, there are things you HAVE TO pay, and maybe you do not have money, so you end up using your credit card for it. That should be something important to note and shouldn't really be a big deal. I think it shouldn't be important on the long run at all and need to be fixed.

[tjtonmoy]

If done correctly, anything could be good but it is true that most people who use credit card seems to face debt in their life. If you use the credit card responsibly while doing some calculation and setting up a budget, then you are fine, you are good to go. You know what you are doing. Credit card is a great way of borrowing money without facing the trouble of doing many paper works and waiting.

Only those people who use it carelessly are in great debt. "I can borrow a bit of money and use it to buy me this and that. I will pay it back in the future when I get money." People with this mindset will always fall for debt. Doesn't matter if those kinds of person are using a credit card or traditional cash. Those who have the tendency to borrow from people and live on that will never be able to come out of it. No credit card, they can always borrow from other people.

But the thing is true. When you are using cash money, you have a better understanding of how much money you are carrying with you and you can afford to use. This way you get a better understanding of your spending and control it according to your budget. While on the other hand people tend to get carried away with credit card.

It is true, but the fact still remains the same. Right person can use it in a right way, while wrong person can use it in a wrong way.

[CryptoHeadlineNews]

Individuals who avoid using credit cards tend to have a higher probability of being debt-free, showcasing financial discipline, and experiencing greater satisfaction compared to those reliant on credit cards. What are your thoughts on this stance?

Being in-depth, or being reckless or indiscipline all totally has nothing to do with either cash or credit card payment, as it all boils down to the individual in question, of which both cash and credit card payments all has their advantage and disadvantages, and left for an individual to choose that which is most beneficial to him or her. Because while a person living in a city or town may prefer to use credit cards, someone living in the village may prefer to be using cash for payment of goods and services. Henceforth, the location by which a person finds himself matters a lot.

Note: Being discipline is an inner quality far beyond either credit card or cash

[oktana]

Do you believe that someone who exclusively uses cash for their purchases rather than credit cards is demonstrating financial literacy? Many argue that people tend to be financially reckless when using credit cards, often forgetting that it involves borrowing money. In various Netflix TV shows depicting individuals in debt seeking advice from financial advisors, the most consistent suggestions for getting out of debt are usually to cut up their credit cards and transition to making cash payments.

Individuals who avoid using credit cards tend to have a higher probability of being debt-free, showcasing financial discipline, and experiencing greater satisfaction compared to those reliant on credit cards. What are your thoughts on this stance?

Not entirely because some people who have a credit card also set limits on it just to be on the safer side of impulse buying and debts (cause that's what mostly happens). Meanwhile, for some other people, using cash can be a sign of financial discipline because it's a tangible form of money, hence it makes it easier to physically see and control your spending. Additionally, you can only spend what you have in your wallet and that can prevent you from impulse buying or accumulating debts. However, if used well with discipline, credit cards can be beneficial through cashback, rewards, building a good credit score, and more.

[Xylber]

Cash is king. And more private.

Do you remember the 80's and early 90's where having a credit card was a symbol of status and high-class? Now a credit card is a symbol of being in debt.
Taxes/fees paid when you use your credit card are high, and in countries with a lot of devaluation/inflation is getting higher. The majority of people I know is using them only because they don't have the money to make a one-time hard cash payment.

Sure there are some "benefits" like travel points, refund of some taxes, etc., but this only shows that either the fee you are paying for using the card is already high, or the government wants control over the spending of their citizens.

[libert19]

I don't have credit card but I use pay later services on ecom sites because with this payment method returns are faster, I pay the accured amount before the due date, it increases my credit score which is extra bonus, I find nothing wrong with it despite in past myself despising credit cards.

Whether literate or otherwise, credit cards are fine as long you pay on time. It might be hard to do so for CC addicts, hence may be financial advisors recommend using cash for payments.

[Uruhara]

Do you believe that someone who exclusively uses cash for their purchases rather than credit cards is demonstrating financial literacy? Many argue that people tend to be financially reckless when using credit cards, often forgetting that it involves borrowing money. In various Netflix TV shows depicting individuals in debt seeking advice from financial advisors, the most consistent suggestions for getting out of debt are usually to cut up their credit cards and transition to making cash payments.

Individuals who avoid using credit cards tend to have a higher probability of being debt-free, showcasing financial discipline, and experiencing greater satisfaction compared to those reliant on credit cards. What are your thoughts on this stance?

I think the answers will really vary on this one. Because there are many people who use credit cards every day but they are still good at managing their finances and can still maintain their financial stability. And on the contrary, there are many people who are in debt even when they don't use or don't even know about credit cards. So I think it all depends on a person's insight and discipline in managing their own finances. Or it will all depend on the different cases experienced by each person. For example, if someone is not good at managing finances and becomes more wasteful when using a credit card, then of course the solution is to stop using credit cards and switch to cash.

[EluguHcman]

If you are in my country and you queue for 30 minutes to 1 hour before you are able to collect money in ATM machine, or you queue in the bank, you will be thinking of how you can avoid these delays

I think in such a scenero, one who finally succeeds a make withdrawal after much time spent in the queue might inspire to place financial withdrawal excessively beyond budget with a draftic measures to give a bit gat to the bank in accordance of avoiding such experienced stresses.
Hence, this singular system of having more cash at hand beyond budget could trigger to unnecessary expenses.

[Davidvictorson]

There are many advantage and disadvantages to using a credit card. However, I have lived all my life in a country where all we use is debit card so I may not be able to speak from personal experience about using a credit card. What I know is that from where I am from, debt is a bad thing. You do not want to be in debt so we learn to pay for every straight from our bank account using our debt card. We do not see debt as a good thing and no one is applauded for being in debt. In fact the measure of financial literacy is avoiding debt in all its entirety.

[Youngkhngdiddy]

I think the answers will really vary on this one. Because there are many people who use credit cards every day but they are still good at managing their finances and can still maintain their financial stability. And on the contrary, there are many people who are in debt even when they don't use or don't even know about credit cards. So I think it all depends on a person's insight and discipline in managing their own finances. Or it will all depend on the different cases experienced by each person. For example, if someone is not good at managing finances and becomes more wasteful when using a credit card, then of course the solution is to stop using credit cards and switch to cash.

  Living in debt is energy-draining. Buying stuff we can't afford might provide short-term satisfaction, but in the long run, it will suck our life away. If you can't afford to pay off the full balance of your credit card every single month, that’s enough of an alarm for you to STOP using credit cards! Always live below your means, save and wait until you can afford those expensive things. Simple living is WAY better than a living with financial bondag,  as long as you clear your balance every month. By doing so, your credit rating climbs at the fastest rate, and you often gain more points/incentives/gifts through various programs that the credit card companies are offering today.
    If cash is lost or stolen it is gone. If a credit card is lost or stolen, I am typically not responsible for any fraudulent transactions, and none at all after I can report the card stolen. credit cards are awesome. You certainly don’t have to feel bad about not paying the credit card company interest to borrow their money. Their costs are covered by the transaction fees anyway. Since credit card transaction fees are pretty much built into the prices of everything (excepting the rare cash discount) you may as well get to enjoy the benefits.