A false sense of secuirty beyond the credit card
In the USA, credit is used as a form of income at time, as a form of building trust, as a way to borrow more.
Before credit, people paid and lived off what they made and could afford. Then trust was established and borrowing with a promise was born. Before my time, probably before my parents time, people had parties to celebrate paying off their homes. People actually paid off their mortgage. People typically lived debt free. They didn't have car payments, they did have overpriced items, but only the stuff they could afford.
Only the stuff they could afford. What does that word, afford, mean to you? Does it mean what can you pay each month? What you can pay off eventually? What you can buy with the cash in your wallet, with the rest of cash in your bank account, or with the crypto you can exchange?
Lunch room talk. What would you advise?
My coworker is original from another country and unfortunately waited to long to purchase flight tickets and the prices have doubled. Flying home for the winter holidays are always expenses, but we get paid every other Friday. She mentioned her flight situation to us and said she is dreading waiting any longer, but can't afford to buy the tickets before payday.
One coworker recommended she put it on a credit card. She said she would, but she maxed it out again. Thus began the credit card discussion. Most people at the table agreed that his advise was terrible, but his point was once she learned to manage her money having multiple credit cards was beneficial to building credit. We then took a poll and everyone at the table expect for me has a credit card.
Anyone can argue the pros and cons, but my question to you is about the behavior.
Let's agree on the following: Some people manage their money with or without a budget without over drafting, without maxing their credit card, and most people are indent in some way. Either with student loans, car loans, cell phones, or mortgages. Most of the people sitting at the table live paycheck to paycheck. Most of the people at that table are younger than thirty, fresh out of college, and grew up believing borrowing money is a way of life.
If you were sitting at that table, what would you advise her to do? Take out another credit card? Which by the way she attempted to do and was dined. Would you recommended she borrow it from a friend, her boyfriend, or family? Would you tell her to get on a written budget or use an app?
Thanks for reading, upvoting, and commenting!
Love always,
Jeremiah 29:11 New International Version (NIV)
For I know the plans I have for you,” declares the Lord, “plans to prosper you and not to harm you, plans to give you hope and a future.