(VINnews) — Credit card points and miles are all the rage, especially in the frum community. Everyone seems to be in search of the next amazing offer, getting lots of free stuff and outsmarting the banks. But is there a hidden danger? Are credit card companies trying to get us addicted to debt and financial misery?
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A top financial advisor is warning that credit card miles are a “gateway drug” to living beyond our means. Eli Fried posted the following on LinkedIn:
Credit card miles is the $ gateway drug.
It feels great. You’re cool, shrewd, a winner.
And you might be able to control yourself and only reap the good times.
Many do*.
But many others get addicted to living beyond their means.
And become debt junkies.
Throw in some HELOCs.
Then some pay/cash advance.
And that’s one way a nice clean kid looking for kicks ends up with the financial equivalent of a life sleeping on park benches.
Go for miles if it interests you.
But be careful.
You may not be as disciplined as you think you are.
The credit card companies are banking on that.
*I’m not a big miles guy, nor have I ever smoked dope =) . I do know plenty of people using miles very effectively but I also know some drowning in credit card debt.
Fried’s post received a great deal of affirmation from LinkedIn users. One wrote the following:
“I’ll never forget the first thing Dan from Dansdeals said at his live conference in Jerusalem years ago. It’s a dangerous game and if you don’t cover the card for even one month you already lost all the gain from the 2% cash back/miles etc. Don’t play the game if you can’t do it.”
Fried replied: “I get a sense Dan and the crew have been very transparent about the potential rewards AND risks.”
People relying on credit cards too much isn’t because they’re motivated by points, it’s because they’re poor and they want to buy stuff.
Credit cards are killers. I see people buying unlimited groceries on their cc. Be careful. I ask people how they flew. Everyone says points. No wonder people are going broke. I took my cc and cut them in half. I keep it on my dinner table. Everyday I pick up the bowl of cards and shake it as loud as it goes.it keeps my family on their feet. Cc are our enemies just as the terrorist. They can both blow you to pieces.
Everyone should learn common sense finance
I absolutely love Dave Ramsey he has great advice especially about debt and living within your means
Obviously being jewish a lot just cannot apply but many of his principles are sound
He has a lot to say about how people use cards and think they’re so smart because they made a couple bucks but they end up paying fees and losing money and ending up in debt
Credit cards not only allow a person to accumulate debt but studies show people spend much more when they shop with a card Vs with cash. They don’t feel the impact of their purchase. But if people would add up the true cost of using credit cards we would realize the couple of miles didn’t really mean anything
Absolutely!! To that headline.
Short answer – no, but yeshiva tuition is.
Don’t blame the credit cards, it’s the way they’re used. Start treating yourself as an adult, you can spend within your means and use debt wisely.
Without working on self discipline, I don’t know how snapping credit cards will help you.
To shmendrik: I couldn’t elaborate ( it’s an open Internet out there ) but it was mine , as wrote you long ago : just in case : we might sometimes greet .