Got too much plastic in your wallet?

Is there to much plastic in you wallet and not enough cash? There are a lot of myths our there when it comes to credit cards and debt in general. The myth and truth below is from Dave Ramsey's (not Ramsay or Rasmey) Financial Peace.

Myth: “I pay my credit card off every month with no annual fee, I get brownie points, air miles, and a free hat.”

Truth: A recent Dun and Bradstreet study found that when you use plastic instead of cash you spend 12-18% more because spending cash hurts. So what if you get back 1% and a free hat?

We also know that when you are purchasing food or eating out and paying with plastic instead of cash you will spend 18-25% more. Spending cash hurts and we can visualize the money leaving us. It does not work that way with  a credit card. We tend to forget about the purchase until we get the monthly credit card bill and ask who spent all of this money! Tell us your thoughts on cash versus plastic.  

 

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