I don't think many would argue Credit card debt is one of the leading causes of the financial crisis in America and the leading cause of stress among families. Of course are some advantages to having credit cards. They enable us to establish credit history, which helps us move on to get approved for Home Loans and Auto Loans. There are few of us that can go out and pay cash for a new home or car, so for the majority of us we need credit. But how we use our credit cards really impacts our future financial status and is really an indicator to how an individual manages his or her finances.

So are credit cards important? I think after reading the above paragraph we can see that they are, and that in many ways we benefit from them. Outside of the benefits mentioned above they are also useful when you find yourself in a tight bind. Maybe it's several days until pay day and you just had a flat tire. So, you can see in instances of emergency or even while traveling they can really come in handy. But what we neglect to do is really use them only in a case of emergency. We get into the mind set and lifestyle of buying now and paying later that we forget about the consequences or even how much we are spending.

When you go to the grocer, and you pay with cash you know you just used a $20 bill and now you have X cash left in your wallet. With credit you don't really see how much you have spent at the end of the day, because your not limited by the amount of cash in your wallet... it's a different mindset. If you are in the crowd of keeping tabs on your spending and you pay off your debts every month, then your on the right track. Imagine what those credit card owners who aren't making punctual payments are going through financially! They are paying lots more because of interest for products they bought months ago or even worse yet last year. Lastly, there is the misuse because it creates a false sense of financial security or having more than you actually have that often ends up in people having massive credit card debt.

Cash or Credit? Budgeting is a key part of handling your finances. And another key element in my opinion is getting into more of a "cash" mentality. Think of it this way if you can't pay cash for it, maybe you shouldn't buy it. Another benefit is when you go to buy a car the more cash you put down the greater chance you have of getting a loan for the difference, no matter how bad your score is.

You could have the worst score in the world and if your 10k short of buying a new car, trust me that sales guy is going to get you that loan, that's the power of cash. This is often neglected when people have to rely on credit cards to make their purchases. Therefore, some people are on a toss-up between which is the better means of making financial transactions, either on cash or through credit card. Usually its difference of getting it now or later, and most of us want it now. When we are hungry we have a drive-thru, if the computer is too slow they create a better processor the next year, everything is designed for faster and better. I am the same way, but then again I don't have much patience. I want it now, hot and fast, so I can get on my way. This is the society we live in today.

Imagine yourself paying only cash during purchase; is there more an emotional attachment to the purchase? Maybe you feel that cash is "limited"? Is there less attachment with credit cards because it's just a piece of plastic, we did not work for it all week, and it looks like its limitless? Interesting perspective if you choose to look at it that way... think of it as chewing gum for the brain.