In this failing economy, it makes sense to understand all you can about a financial obligation before you sign on the dotted line. Yes, the advertisement says: “lowest rates” and “pre-approved”, but what it really means is, “give us your information, let us check you out, and offer you less than the best rate”.
Credit card companies have a common goal; get as much of your money as they can. They do this with number clever techniques. First, they lure you into taking the credit card contract with an introductory offer of low interest for a specified amount of time. Then, they lower the minimum payment to an amount that insures you will never get out of debt if you only pay the minimum payment, that just so happens to be filled in bold print to get your attention. Just let that payment be a few days late and your interest rate jumps to an outrageous amount like 35%, but it will be the maximum allowed by the laws of the state that you live in. This makes the balance increasingly harder to pay. Don’t forget to count those late fees, they won’t.
What were we talking about? Oh yes, the moral issues against credit cards. It should be named the immoral credit card companies, and how they are stealing your money, your retirement, and your soul. Have you ever wondered how much money credit card companies spend on the mailers that show up in your mailbox by the dozens? Even at the commercial rate of mail, I think around $.25 each, plus the cost of the envelops, the paper inside, the type setting, graphics, and process labor to stuff, collect mailing lists, haul the mail to the loading dock for the postal service. It is easy to think that this will cost as much as $1.00 per piece of junk mail they distribute. Using the standard conversion rate of 1%, this means $100 per new customer. That is outrageous to think that the cost of getting you to take a credit card might be that much. Why do you think they do this? My guess is they are going to make thousands from you during your lifetime, making the $100 dollar investment a drop in the bucket.
Credit card debt is the leading cause of bankruptcy in this country and will prove to be the worst use of credit in the history of credit in our country.
Yes, I think credit cards are immoral, but more to the point, I think they should be illegal. Since banks now offer debit cards for no or low cost of use, it makes more sense to only use your debit card for purchases, and leave the credit card companies in the same boat as the mortgage banks who are failing from the profiteering and shady deals to increase their profit. The government will bail them out. Do you think they will bail you out for over extending your credit card balances?