They wouldn’t make a profit if people didn’t carry a balance. Sure, they get the 2% from merchants, but that is not enough for them to keep going. (Not to mention that all merchants likely pass most of that 2% cost on to the consumer.)

If the Credit card company gives you a 2% cash back reward, they are breaking even with the merchant fee, which after expenses, is a loss.

People like you cost the credit card companies money, but they have plenty of undiciplined people to subsidize your dicipline.

Credit card companies are not around for the “common good”. They exist to make a profit, and they will change their policies if too many people use them like you claim.

If you enjoy your interest free 30 day loans and rewards, it does not seem in your best interest to tell people to pay off their balance because their interest payments are keeping your rewards alive.

I know you won’t likely change your mind and that doesn’t bother me.

But I think you’re guilty of making the very same “positive assumptions” about human nature that you accuse us financial “children and adolescents” of making about our purchases.

And, frankly, I think statistics are against you here. Most people that use credit cards DO NOT pay them off each month. Likewise, most people have very little or no money in the bank. Coincidentally, most of the population carries some sort of long-term debt (cars, boats, HELOCs, etc.), in addition to their mortgages.

So, what you have to understand is that for those of us working the Dave Ramsey plan, we have an evidence-based, principled stance that debt (in this case embodied in credit cards) steals from us. And we’d like to stay as far from it as possible.

I completely agree that credit cards are not evil in and of themselves, and for a certain, small percentage of the population, they can provide a kind of financial convenience. For the rest of the population, credit cards are a kind of exposed wiring just sitting around the house waiting for the right set of circumstances to electrocute everyone in the room.

Here is the core of the problem, and one that creates a catch-22 for your credit-education efforts: as long as people depend on and can rationalize using credit cards, they’ll have no incentive to learn the kind of healthy financial habits that lead to NOT having to depend on credit. On the other hand, that ensures lots of readers for your blog!

The only way to learn how NOT to use credit is, well, NOT to use it.

One year ago, I had $16,000 in CC debt and too-big mortgage that was sucking the life out of me. But as a result of working the same extremist plan that EnemyofDebt uses, I have a positive net worth for the first time in a decade.

And, coincidentally, I didn’t use my credit card even one time in order to make that happen.

Thats right. We don’t ‘take advantage’ of the rebate offers. Why? Many, many reasons. Number one being that you can’t get rich off your credit card mileage points. And two being, why take the risk? Why deal with the hassle? ALL of those benefits (theft protection, purchase protection, etc.) come standard with my Visa DEBIT card. Heck, even the interest-free grace period, only the debit period is INDEFINITE.

I don’t know anyone who has a credit card and has never paid interest on it. One of these days, you’ll forget to pay it, or your payment will be lost in the mail, or you’ll spend 18% more (statistically) on your credit card than you would have if you’d spent cash.

I’m not saying credit is evil. But they aren’t out to help you.

FROM THE USA.VISA.COM WEBSITE
With a debit card, also known as a check card, you can shop at many merchant locations without having to carry cash or remember your checkbook and enjoy all the protections of using Visa, like our zero liability policy* against fraud.

Benefits of a Visa Debit card

* Convenience – The Visa Debit card frees cardholders from having to carry bulky checkbooks, multiple identification cards and large amounts of cash.
* Security – Visa offers debit cardholders Zero Liability* in cases of card fraud, theft or unauthorized card purchases for signature-based transactions, provided cardholders promptly notify their issuer of such fraud, theft, or unauthorized purchase.
* Acceptance – The Visa Debit card can be used anywhere the Visa Debit cards are accepted symbol is displayed—at more than 24 millions of locations worldwide. Visa merchant locations around the globe.
* Budget tracking – The Visa Debit card helps track everyday spending as monthly bank statements list how much was spent and where.
* Fast, easy payment process – No checks to write, and no need to present an I.D. or other personal information at the sales counter.

7 out of 10 people live paycheck to paycheck and all these numbers prove is that most Americans DO NOT have the discipline you speak of. It is obvious that people are spending more than they make, which would suggest that what I am offering people is needed. They are already doing it your way and look at the numbers. As you stated, it might work for some but not others but maybe you should turn those numbers so that “most people” refers to those that need it. You happen to fall in the minority according to all the numbers.

People need to be educated to become more like you, not told that learning ways to become like you are extreme. I think that makes you more of an extremist than me. One stands to make a lot of money off of keeping people hooked on the plastic. Do you get paid for pushing credit? Just curious, not being rude. Thanks for linking to me and giving me a chance to share my thoughts on your blog. Your opinion is respected and it’s okay with me that we disagree. Have a great weekend!