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Paper or plastic?


Going into debt is like crashing a car.

An irresponsible person with a credit card can equal disaster. When a credit card is used to purchase items, a person is promising to pay the credit card company back the money spent plus any interest. If payments are not made on time, the credit card holder’s credit rating can be adversely affected.

“A lot of times having that credit available encourages people to buy things they really don’t need because it’s convenient and available,” said Gary Shepherd, executive director of New Hope Financial Fitness Centers, Inc. “They may not have the money for the item, but they can afford the payment.” 

Having a good credit score is important. Employers are starting to look at credit scores to determine how responsible that person is. Many people need credit to buy a house or purchase a vehicle. Not only is a credit card useful to have in times of emergencies, it is also more convenient than carrying large amounts of cash.

“I use my credit card to buy things I know that I have money for so I can get my cash rebate,” said Saad Kazmi, pharmacy manager over Sam’s Club pharmacy. 

Credit cards can sometimes be confusing for students and can mess up their future if used improperly. Every credit card has a different interest rate and grace period, which is the time you have to pay it off with no interest charged. 

Some tips for managing a credit card would be to pay all charges due on the monthly statement. Always check the monthly credit card statement for accuracy of charges. Usually the bank will have a website to check statements and manage money.

“With the economy the way it is now, people are using credit cards to supplement income rather than adjust their lifestyle. There’s a real danger in that,” said Shepherd.

“I’ve always heard to stay away from credit cards because I’m supposedly not mature enough to handle one yet and cash is always cheaper,” said Clay Wadsworth, student at Tyler Junior College.

If a person has a checking account, a debit card can be used for purchasing items. However, it is important to keep track of the account balance.

“Even debit cards have their downside because if you’re not real careful and don’t keep track you can overdraw your account quickly,” said Shepherd.

Staying out of debt all boils down to simple math: do not charge more on a credit card than what can be paid off in a month.

“If you pay your balance off every month, there’s nothing wrong with them at all,” said Shepherd.

“I think that cash tends to let people see what they’re actually spending as they’re peeling off dollar bills to pay for stuff,” said Shepherd.

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