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Cash or Credit?

The concept of using a credit card began in the United States during the booming 1920’s.  John Bigging of the Flatbush National Bank of Brooklyn in New York invented the first bank associated credit card in 1946.  A few years later Frank McNamara introduced the first nationally used credit card.  The Diner’s Card was created to help families pay restaurant bills as a recent study has suggested individuals paying by credit will spend 47% more than those paying cash.  Thus, over the past 70 years shoppers continue to hear cashiers say “cash or credit?”

A man lacking common sense gives a pledge and becomes guarantor [for the debt of another] in the presence of his neighbor, Proverbs 17:18.

This consumer shift from cash to credit has altered business and marketing practices.  For example, a brief comment in the 1910 Sears Catalog stated “using credit to purchase merchandise is folly.”  This is a complete paradigm shift from modern advertisements.  American Express used Roger Daltrey in 1985 to convince future shoppers, “don’t leave home with out it.”  Other credit card companies offer cash back bonuses for spending X amount of dollars per year.  The only problem is that over 100 million Americans do not pay back their monthly balances leading to a debt epidemic enslaving families with bills they aren’t able to pay back.

The rich rules over the poor, and the borrower is servant to the lender, Proverbs 22:7.

When my wife and I take our family on vacation, we usually withdraw cash, two to three hundreds each.  The only time we use credit cards is for gas and restaurants.  A few years ago, we spent a week down in Clearwater, Florida.  With the Phillies in town for Spring Training, my wife wanted to get nice seats.  After $5 for parking, $27 per seat and a couple of snacks, it was painful to blow almost $200 cash in one day.  As Dave Ramsey says is his financial peace university classes, when you use cash instead of credit cards, you can feel the pain of wasting hard spent money.  May this blog challenge you to rethink your spending habits so that you don’t become of slave to debt.

by Jay Mankus

 

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