f you have not checked out Trent’s blog, now is the time to get started. This guy has that “I’ve been through it style” that has made Dave Ramsey so popular. In addition, he’s still getting his financial situation in order after hitting rock bottom in 2006 and provides regular updates about his finances. Trent is also the most well read blogger out there. He rips through books every week and puts up some well thought out reviews about them.
I’m pointing you to him today because of a firestorm he started on his blog. There are differing opinions about the use of credit cards and Trent identifies the pros and cons of their use. If you’ve read about my personal finance situation you will know I lean to the side of supporting their use. But its possible that there is a moral dilemma here. Let me explain:
Chase was able to convince me their credit card was the way to go. This was accomplished by offering cash back on all my purchases. Chase does not make any money off me via interest and fees. They get a small cut of my transactions (it costs money to process credit/debit cards) via VISA, but that would not provide enough of a kickback alone. They must then get the funds from fees and interest of other credit users to get me my cash back. So by encouraging everyone to pay off their balances each month, I make it impossible to get cash back. Short version, I am profiting from someone else’s bad judgment.
Well I’m not too worried about that. Even with a recession, credit crunch, and organizations like Weakonomics, there won’t be any shortage of people misusing credit cards. If these programs were to end, I won’t lose any sleep. Its going to take a full year to rack up $250 in cash back rewards. Not a huge loss.
Go see what Trent has to say and read all those comments.
The Simple Dollar
 By The Weakonomist |
The Weakonomist is the founder of Weakonomics. Clicking the picture of the puppy will tell you more about him. If you like what you're reading consider subscribing to the blog, following him on Twitter, and checking out the related posts below. Please consider a donation if you really enjoy Weakonomics. Also keep in mind that nothing I say can be construed as financial advice. |
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