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Living Without Credit Cards

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Posted on : 11:19 PM | By : Nic | In : , ,

We used to think that credit cards were a necessary part of growing up.  When I started going to college and applying for scholarships, I used to get 'credit counseling' pamphlets about establishing credit, and the number one way was to get a small credit card.  The truth about credit is that it is debt.  Plain and simple, debt is bad.  There is only one thing that you need to ever get into debt for, and that is a home mortgage.  Even vehicle loans are unnecessary.  Here is how we live without credit cards (not even one of those Visa Checkcards!):


Vehicles:
Buy your car cheap and for cash... or borrow it from your Aunt Sally.  Cheap older cars are still reliable, and if you get a tiny one they are great on gas mileage.  Get the right model and the parts are cheap, and because they don't have computers, they are easy to fix.  If you have to borrow a bit from family, you won't get murdered with interest.

Renting a vehicle (or renting other stuff like hotel rooms):
Sometimes you need to travel long distances or rent a truck to move your junk.  Most vehicle rental places require a credit card number that they hold ransom just incase you decide to steal their vehicle.  However, U-Haul does not if you do not reserve the truck ahead of time.  Usually there is more than one U-Haul vendor in an area, and if you go in early in the morning on the day you need it, you can rent a truck right away.  You may have to run to more than one location.  An easier option is to own very little stuff, and buy a truck or trailer for cash to have on hand if you need it.  If you need to take a long trip, I highly recommend taking a train which you can purchase tickets for at a travel agent or an actual train station.  You can also rent hotel rooms this way, or go for a Motel 6 which usually has vacancy anyway.

Buying online:
I use Paypal, which you can use at Powell's Books, and many other websites, but if you want to use Amazon you can pay by check or directly from your checking account.  If a website is demanding a credit card, remember there are so many others that won't.  You should be buying handmade from websites like Etsy which accept Paypal or check anyway.

Use cash:
I generally avoid writing checks, and here in Canada it's actually less common to use cash because of Interac, but we use cash anyway.  We take out the amount we've budgeted to spend for a certain thing, and that's that.  Anytime we start using Interac we go over budget.  Actually, the first thing we do is pay our savings account first if possible.  By having a buffer, if we need new teeth or have to take a sudden trip, or want to get the last seats at Cirque de Soleil, we've got it and don't have to resort to a credit card.  We lend it to ourselves, and pay it back to have at least $1000.

Buying stuff you really want but can't get right now:
There is this miraculous thing called store credit.  It's eeeevilllll.  It opens the door to all kinds of horrible credit opportunities.  When you can't afford something you think you need, walk out of the store, and run to your local second-hand shop, look on eBay, or post on Freecycle.  Find one used that you have the cash for, or save a bit longer until you can afford the one you want.  Because if it's not food or electricity, it's a want, not a need.

The bills:
Sometimes credit comes in handy as overdraft protection or to pay a bill that comes up and you don't have the cash for it.  What you don't realize is that the reason you don't have the cash is that you're paying all of these little minimum payments on these little cards and credit lines.  It's eating away at your available money and you're spending beyond your means.  Keep that savings buffer and quit using the overdraft.  

Quit your job:
Just kidding, you need an income.  But without debt we work 1/4 of the time that we used to.  We are extremely wealthy in spare time.  Debt robs you of spare time because you have to work that much harder to maintain it.  Spend less and work less and treat your life like you've already retired and you'll be much happier.

Comments (4)

Great Information. Hubs and I are working on paying down all our debt.

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The problem is many people want everything like yesterday. Debt has become almost like an accepted part of everyday life as if there is no other way to do things. It is hardly surprising that it has headed this way when advertising is constantly trying to tempt you into having credit cards and loans etc etc. It is great if you have good self control and can save up the good old fashioned way but to so many this practice is alien.

That's so true that debt is just accepted. It is much more available now I think too. And bankruptcy is much more common. I hope the post doesn't make us sound perfect either, we've definitely fallen into these traps before and we fight to stay out of it.