One of the more debated topics of personal finance, using credit cards.  On one side of the debate, credit cards are evil pieces of plastic that will cause your financial life to spontaneously combust.  On the other side of the debate, you can use a credit card and pay it off every month then get paid in points or dollars for buying things you would no matter the payment method.  I believe that both can be true. I hear it all the time almost like credit card companies train people to use their script, “I pay it off every month, I only use it for things I buy anyway, and I use the points for free stuff.”

I do not personally use credit cards and my wife cringes when a cashier asks if I’d like to sign up for one to save 5% on my purchase (that’s just a bonus though).  I have used credit cards before but not for many years. I used to carry a balance even, gasp! It was zero percent interest so it didn’t count, right? All joking aside, credit cards are not for everyone.  Companies offer them for a reason and it is not to lose money. They’re making money somehow. If you read the reports on usage you’ll quickly see that the vast majority of money is made from folks that carry balances and those that carry a balance often have lower credit scores.  

I challenge everyone using a credit card to take a hard look at your spending, make sure you’re actually using the points, and look back two years to make sure you haven’t incurred interest or fees.  One you’ve done that, take a break for two months from using your credit cards and see if you spend less. Be honest with yourself and see if your behavior and costs match what you believe to be true for you.