Top Reasons Why I Don’t Have a Credit Card

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Credit card debt is still one of the biggest problems the ‘modern‘ people face nowadays. They are so easy to obtain, we get lured in by great rewards and all media outlets keep on promoting luxury, so we’re clearly easy to persuade, unless we are really determined to not overspend and have already found a great money-life balance (which, let’s face it, it’s not easy, especially when you are younger.

While I don’t live in the US, we do have credit cards here in Romania, too, and banks are doing all they can to entice us to enroll for at least one of them.

Here are my top reasons to NOT get a credit card yet

1. I fear that I’ll make some credit card mistakes that would bring me back into debt.

While I do know more about personal finance than the ‘regular Joe‘ in my country and continue learning each day, I am not perfect. While in theory I have it all planned out great, life does happen and I know it won’t be long until my credit card would mean solving some ‘emergencies‘ or just indulging in some shopping.

2. Spending cash is ‘harder’ than swiping a credit card

‘Plastic’ money is easier to spend. It’s not just my case, it happens to many other people. When I have to open my wallet and see my money go, it’s easier to curb my spending, than when I swipe the card. I have noticed this with my PayPal account.

Let’s say that in the past years I have spent money on web related stuff, money I’d have never considered paying if it was my cash. PayPal money seems to be just ‘numbers’, when it’s actually my income from my web design business, money I’ve earned by working hard.

3. If I don’t have a credit card, getting in debt is harder for me

Having the possibility to pay more money than what’s in my account will lead to me getting back into debt. If I don’t have the option, it’s hard to think I’ll move my behind to the bank and ask for a loan. This way I’m automatically ‘forced’ to live within our means and not get into debt.

4. The fees and commissions are HUGE on credit cards

Since I don’t have a credit card myself, I do rely on what my friends are telling me and also what I’ve read in the personal finance blogosphere. Let’s say that the interest rates on some credit cards are absolutely INSANE. Why would I risk having to pay all this money, when I can just avoid yet another danger?

5. I don’t rely on rewards, I save money for the things I like

Some of these credit cards come with amazing rewards, making it easier for people to enroll (so that they don’t miss out on such great stuff). We don’t need travel rewards, we save money for this. I don’t need cash-back either. OK, it would be great to have these, but, again, if I make one single mistake, I’ll be paying too much money and any rewards won’t matter anymore.

6. We don’t have credit scores here, not to mention I don’t plan on getting any loans soon

In Romania we don’t have the credit score system that works in the US (and other countries). This means that I don’t have to worry about getting a credit card just to build my credit score.

These are my 6 reasons for staying away from credit cards. Of course, this might change in the future, the only reasons why I’d get a credit card would be to use some really amazing rewards or build credit score. I’d probably be crazy careful with this though, so that I don’t end up in credit card debt.

What are the reasons you dislike having credit cards (if you already have them). Have you considered not using them at all?

27 COMMENTS

  1. This is a really sensible list. I do have a rewards card that pays me cashback on my fuel costs, so for me, it’s worth it.

    I particularly like what you said about spending cash is harder than swiping a credit card – things are moving quickly in FinTech and soon there will be contactless card points everywhere in shops and cafes. etc. Soon after that it will be done through your mobile phone… then what next?

    Cheers
    M recently posted…Why Losing My Job Was the Best Thing That Happened To MeMy Profile

    • Thinking about all the advancement in FinTech (great term by the way) is a little bit of double-edged sword I would say. I get it, and the convenience is nice, but at the end of the day if it is making it easier to spend, that probably results in a lot of excess spending, and that is never really a good thing. It depends on the person, of course, but that potential will always be there, so it just makes me question the whole direction that we are going here. It should be interesting to see where it goes from here, though, and I am just hoping for the best.

  2. On this issue, I am on the completely opposite camp to you, Dojo. I even have a post on my blog titled “Why I Keep 26 Credit Cards.” And it’s not because I use them to finance anything; I pay off the balances monthly. But there are so many advantages to not having to carry cash, getting rewards, having financial flexibility… well, there’s so many advantages that it took me a blog post to lay them all out. :O

    In a nutshell, one of my little mantras is: credit cards are not the enemy; misusing credit cards is the enemy.

    So, for what it’s worth…
    Retired To Win recently posted…How I Heat My House FrugallyMy Profile

  3. If forced I think I could probably get by without a credit card but it would be difficult. For a few weeks last year I was forced to go without one for a short period of time. My old credit card started to charge me a fee (so I cancelled it) and the new credit card hadn’t arrived in the mail yet. It actually ended up being a bit of a pain to setup all my reoccurring bill payments etc. It’s amazing how ingrained some of these things are. You don’t realize until they’re gone. That being said, I do think I spent less that month, so I definitely agree on the “spending is harder” without a credit card point.

    • He he, we do have debit cards ourselves. Husband has 2, I have one and anther ‘pair’ for our business account. So we do have cards in our household, it’s just that we don’t use them too much. I pay via PayPal (or get paid by most of my customers) and we also use the internet banking option in our accounts for other payments. Everything else is paid in cash.
      dojo recently posted…WordPress Design: Cleaning Service BusinessMy Profile

  4. Those reasons all make sense to me. I mean, I’ve definitely become very responsible about paying off my credit card balance every month and earning the associated rewards. However, if you’re not getting the benefits from credit score, don’t have much use for rewards, and might slip back into bad habits, it seems like sound advice to avoid credit cards.
    James@StartingNegative recently posted…Your debt comfort levelMy Profile

  5. I got my first credit card 2 years ago, looking to get a good credit score and buy more stuff for my enjoyment. In a short time this went seriusly wrong and I found myself in debt. Was fortunate enough to make it though, with the help of my folks. I am now very careful with my spending and credit card use.

  6. I do own a credit card, but I never use it to it’s “full potential”, so to speak. I only use it to make big purchases (well, not big, but stuff like renting a room for a city break through websites like airbnb), but only if I know for sure I’m able to pay the debt in time. My bank has this thing, if you pay the debt in time, they don’t charge you any extra fees.

  7. I also worry about the interest rates on credit cards. The rewards might be tempting if you know you have the means to immediately pay off the balance. Though I only use a debit card so I won’t spend more than I have vs “plastic money”.

    • Well the interest rates are how they get you, of course. You are paying for the ability to use their money now, and I think the more you drive this into your head the better. It is really the lack of this type of thinking that seems to get people into trouble, the idea that it is “free” money, when in fact it is quite the opposite. The rewards do a good job of attracting people, as they are intended to, but it is important to not let those distract you. Good stuff, and thanks for sharing.

  8. Interesting point of view, cash is harder to spend compared to using your credit card to pay everywhere you go. The only downside to this is shopping online. I’ve noticed most websites I used over these past few years to make online purchases are actually asking for a fee, as in you have to pay extra cash if you choose to pay for your items when they arrive at your door. So, in a way, they’re inviting you to either use your credit card online (and risk overspending, if you’re not careful) or get out of your house to buy your stuff.

  9. You do raise some great points in your article, but as someone mentioned in a comment earlier, it’s the misuse or the credit card that’s the enemy here. It’s great that you pointed out these reasons not to use a credit card though! It’s so easy to slip and make a mistake that can cost you… literally!

    • Yes it is an important point. Credit cards are in essence a service, but they just so happen to be incredibly easy to misuse, for most people anyway. It is important not to make the credit card itself the enemy, I agree there, but I think it is also hard to isolate it from the companies and the status of it that it has risen to. It is very interesting to think about, though, and thanks for sharing.

  10. I’m sorry, but I strongly disagree. I often use my credit card, shopping online or offline and I actually prefer swiping my card to spending cash because I always make sure I think twice before buying useless items or overspending just because I can.
    It’s all about making the wiser choice, I know I can go overboard, so I just try not too.

  11. I can only imagine what credit usage is like in other countries (outside of the US) – I say imagine because I have no idea what it’s like and what different factors you may have to consider. Here in the United States credit cards are EXTREMELY useful when used correctly. I think it’s important for everyone to truly understand how credit works before taking on a credit card because it truly can be your best friend or your worst enemy. Credit cards have allowed me to work a budget to get me things I normally would not be able to afford comfortably. What I mean by comfortably… I never charge more than I can pay…however, credit cards have allowed me to have instant gratification when it comes to goods and services I would otherwise have to wait and save up for before getting.

  12. I’m not averse to credit card use. I definitely find it convenient. But as you said, one mistake can set you backwards and may just spiral into accumulating debt again. For instance, when I recently lost my job, and subsequently the emergency fund, the benefit of using credit card got lost, as I now have to pay for financial charges. In the past, I use my card to accumulate reward points. It wasn’t a problem then because I pay everything in FULL. So, there’s really NO interest, and I get to buy some stuff for free using the credit card points. The story only change when I resorted to paying only partial after resigning from work.
    tabby recently posted…Philippine Stock market Performance a Day after the May 9 Presidential ElectionsMy Profile

  13. I have never had a credit card. I knew I was not very good at handling finances in the past. I made a number of wrong choices.   One good decision, at least, was to not get a credit card and make things worse for myself. So, thankfully, I was able to learn my lesson without having a huge debt holding me back.

    It’s interesting to read that things are handled differently in Romania. Here in the United States it seems to be very detrimental to our culture. We’re more about spending than we are about saving.

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