Paper or Plastic?

You hear the statistics every day. And they're NOT encouraging. The majority of Americans are swimming in credit card debt. The most consistent figure I've heard is that the average household carries $10,000 - $12,000 in credit card debit. What has happened to us? Credit has become too cheap and way too easy. Millions of Americans, once again, have bit off more than they can chew, just as they have done with real estate, and we are all going to end up paying for it.

President Obama signed the most sweeping credit card reform bill in the Country's history on May 22, 2009. The bill's intent is to rein in the penalties and fees banks can charge, prohibit raising of rates on previous balances, establish minimum time periods for "teaser rates", impose age limits, and etc. It's a long laundry list of reforms that is intended on preventing the middle class from being ripped off. And, yes, it all may look good on the surface but that gold plated finish doesn't look so pretty after you scratch the surface.

Once this bill takes effect, nine months from now, what do you really think is going to happen? Or, better yet, who do you think is really going pay for all the lost revenue the credit card companies are going to have to suck up? Not a hard one to answer if you are one of the few that have been responsible with your use of credit cards. Please step to the head of the class! Say "Bye-Bye" to reward programs, cash back, frequent flyer miles, 30 days grace periods, and no annual fee cards. The credit card companies will seek to make up lost cash by putting the screws to you. In a year from now, will it be worth having a credit card? Once again, you will be answering the age old question of "Paper or Plastic?".

Like you, I'm assuming, I've been notified about changes concerning my credit cards. I actually took the time to call one of the companies about the informed changes because I'm a very responsible customer. Frankly, I was angry about this particular card changing my interest rate because I consider myself a good credit risk and it's really the only one we ever use. The customer service agent on the other end of the line reassured me the changes wouldn't be forever (Right!!), things would get "back to normal" after we get through this economic downturn, and she was willing to allow me to keep my locked in low rate for 10 more months.....because I threatened to drop them after a 12 year relationship!

People need to wake up and make some changes in habit. We are doing this to ourselves. There are choices to be made and life is all about making choices. We see if over and over again. A select few are being tapped on the shoulder and receiving a bailout. And you have to ask.....is this really going to help? My hunch is that those who are already up to their necks in debt are going to end up defaulting with or without the government putting their spoon in the soup. Which leads you back to the Forgotten Man who will end up paying the greatest price when it's all said and done.

As for me, I view credit cards as a convience not a necessity. If things change drastically enough, due to government regulations or otherwise, I will no longer be a "card" carrying member of society. Paper, please!