The Downside To Credit Cards Essay

824 words - 4 pages

When it comes to learning about credit cards, most people do not expect to hear that it can effect a persons overall emotion and wellbeing. By having a credit card close at hand people are able to spend money knowingly but do not realize the implications from their choices. They make decisions that they would not have made otherwise if the consumer paid in cash or the full amount up front on the credited bill. Researcher Greg Davies wrote a paper on the overall behavior of human emotion when it comes to consumer goods. “ His 2003 paper, The Realities of Spending, looked at models of spending behavior and how they were influenced by means of payment . . . The paper identified several theories which could explain why people appear to make irrational decisions when spending with plastic” states Nick Harding, Journalists for the British newspaper The Independent. Davis then continues on stating that the reason for the spender’s interest in credit cards is because it allows them to “decouple” their transactions. They are more willing to spend because they believe that it will be cheaper overtime due to the smaller payments, rather than just paying everything upfront. This psychologically leads buyers into believing that they can have it all without consequences, when in reality this is a false presumption.
Once sucked into this belief, consumers then start to borrow money that the majority cannot afford to pay back on time. When this happens the borrower falls into debt over the years unless they are able to control their spending habits. Credit cards were originally created to help people buy things when it was desperately needed. It was not created for basic transactions but over the years it has changed into our main source of payment. Every year, the overall amount that borrowers fall into debt increases by billions of dollars. People continue to spend money that they are not able to repay during the period of time given to them. A prime example of this is “ Within two years, Gemma had incurred 14,000 of debt. The money went on clothes, holidays, meals, and luxuries.” After this Gemma then stated “I realized I was in financial difficulty when the bills started to come through and I struggled to make the minimum payments. I started to feel ill about it and realized I needed help. I got into that mess because I just didn’t get it. I didn’t get what money was about, I didn’t understand it”(Harding)....

Find Another Essay On The Downside to Credit Cards

Persuading Students to Use Credit Cards and Financial Aid Responsibly

1240 words - 5 pages Consolidation at the soonest possible time. Persuading Students to Use Credit Cards and Financial Aid Responsibly Do Students at Broward College Realize They are Incurring Credit Card and Financial Aid Debts? Broward University has a fast growing population of college students, all of whom seek to complete their college education based on a combination of their parent's educational fund that was set aside for them, and student loans paired

Credit Cards For The Young A Boon Or A Bane:

961 words - 4 pages Credit Cards for the Young A Babe or A Boon?: A Study of Student Indebtedness to the Credit Card Companies A.Introduction 1.Definition of a Credit Card 2.Marketing Blitz on Students 3.Students' Ignorance and Irresponsibility 4.Legislative Issues B.Marketing Toward Youth and Students 1.I started Receiving calls shortly before my 18th Birthday 2.Tables in student unions and cafeterias with free stuff.3.Flyers in every hallway of every building 4

The Negative Impact on College Students with Credit Cards

1311 words - 5 pages The Negative Impact on College Students with Credit Cards To have credit card debt as a adult with a stable job is one thing but to be a struggling college student with it is another. Credit card debit now has a major effect on college campuses as well. A lot of students are able to take care of credit cards well while most end up in a lot of debt. The main reason for this is because the student’s aren’t given enough knowledge on paying their

The Pros and Cons of Using Credit Cards and Debit Cards

3688 words - 15 pages Advantages and Disadvantages of Using Credit Cards and Debit Cards Today, almost everyone has their credit cards or debit cards. It can be used in the malls, shopping online, buying tickets, and much more. Most of the time, people use it because it is more convenient because you do not have to bring cash which could be easily stolen and used; unlike cards where there would still be a number of security features. There are two types of

Cards Analysis, A creative writing in response to the importance of cards in The Solitaire Mystery

633 words - 3 pages The picture cards in the card deck are pretty much the same but each card has its own touch if individuality. All the kings have swords in their hands except the King of Diamonds, which has an axe in its hand. All the kings have curly smooth hair but the Red Kings have their hair curled in while the Black Kings have their hair curled in. The King of Hearts is the only King, which doesn't have a moustache while all the other Kings have one. The

The Credit Crunch and its Impact and the policies for UK Government need to implement.

2336 words - 9 pages explain what policies that UK Government need to implement in order for the British economy to emerge from the recession caused by the "credit crunch".WHAT IS CREDIT CRUNCH?The term "credit crunch" is used to describe a sudden cut in availability of loans or credit that include mortgage, credit cards, and inter-bank lending or when the cost of obtaining loans from the bank has suddenly increase.The credit crunch makes it impossible for companies to

Identify the risks of holding debt securities. Analyze the role(s) of debt securities that led to the current credit crisis.

1427 words - 6 pages price due to falling interest rates. In this case, when interest rate declines, issuer can raise new funds at lower interest rates and able to repay the loans raised earlier under higher interest rates.Credit risk: risk of the loss that may occur if counterparty to a transaction fails to meet its obligations. This risk include three different type of risk, default risk, credit spread risk and downgrade risk. Default risk is the risk that a bond

Gay Marriages...My teacher asked us to write an essay on gay marriages, and if we thought they would be legalized all over the US. Because of the "full faith and credit act" states have...

561 words - 2 pages major problem is that if states do choose to recognize a gay marriage as legal, such marriages may not be valid in those states because of the full faith and credit act. This presents a number of problems and a tremendous amount of opposition within the fifty states. On top of all that, there would be the question of what to do about federal rights like immigration, Social Security, and federal tax law. Our nation has enough problems as it is; it

BRITNEY SPEARS- This essay just explains why she is my idol and I give her the credit that no one else gives her. Us teens can all relate to brit's music and I made that clear in my essay

531 words - 2 pages There are many women that have an impact on my life; however, the question is how many of them do I look up to? Of course the most obvious person is my very own mother, but that made me think who else deserves to join this circle of reverence. Some names entered my mind, but do I really admire them? It is clear that women that enter my daily life like Oprah Winfrey have an impression on me, but impact and admiration do not always go hand in hand

Teenagers and their Credit Cards

1185 words - 5 pages an average of $2,400 on their credit cards, nearly triple what they owed in 1990, according to research by Claritas Inc., a marketing research firm in Virginia.  If, payments of  $75 were made monthly to pay off a $2,400 debt, it would take 3-1/2 years with a 16 percent-rate card, and you'd pay $ 750 in interest.        "There's no question that young adults are the most heavily burdened by credit card debt

Credit Card Marketing on College Campuses

584 words - 2 pages students are adults and need to earn credit, credit card companies should not market to college students on campus because they are too naive and this results in graduating with too much debt. Students do not have the education needed to use credit cards responsibly. Nellie Mae (August 2007) states that 93% percent of students would have liked more information on financial management topics before they started school and want financial management

Similar Essays

Credit Cards: Worth The Risk? Essay

721 words - 3 pages While a credit card is defined as a plastic card having a magnetic strip, issued by a bank or business authorizing the holder to buy goods or services on credit, the definition alone says little about the advantages and drawbacks of the cards themselves. Useful for individuals such as college students in paying for expenses, credit cards are a convenient tool when used properly and responsibly.. However, if abused credit cards also have their

The Convenience Of Credit Cards Essay

911 words - 4 pages Credit cards can be invaluable tools for college students. Using a credit card is more convenient than cash, and may help a young adult build credit that will be useful throughout his adult life. However, before a student applies for a credit card, he needs to know how credit works and the consequences associated with the misuse of a credit card. Credit can be very helpful, but may also be dangerous if one does not use it properly. Many

The Social Effects Of Credit Cards

823 words - 3 pages Charge ItWhen American Express and the Diners club first launched their idea for a credit card they had no idea how it would affect the rest of the Twentieth Century. It was originally an agreement between a couple of upscale New York City restaurants to give their customers a sort of tab; however, it didn't revolutionize the way we spend money until many years later when the magnetic strip was put on the back. Credit cards are basically an

Credit Cards And The Foreclosure Crisis

1535 words - 6 pages housing and slowly, very slowly, they would be able to rebuild their credit maybe even raise it. To do this, there have to be a few new rules applied to the industry as a whole. Placing lower limits put on credit cards and or a limit to the number of cards one person may have at a time would be a start. A few days ago, a credit card company offered to me. One was under my dad’s family name and the other my mom’s family name. Same card but I was