> These cards are accepted by society because they benefit those who know how to use them, but it's hard to look past the fact that so many people, if not most, are financially illiterate (because of failings of education due to lack of funding) and so many people screw themselves financially for decades if not their whole lives because of them.
I went through the U.S. education system in 8 different states in schools in poorer areas, and even then, the education was sufficient to understand the concept of not spending money you do not have.
Set the thing to auto pay the balance every month, and do not spend more than you earn. I expect that much from the 95% of the population that has had the opportunity to learn how to read and write.
Almost everyone in the U.S. spends money they don’t have. We borrow to buy a car, a house, to go to college. When one does not live on the precipice of missing rent and whatnot it is easy to say, “ Don’t spend money you don’t have.” Such advice is as useless as it is easy to say.
The thing is, if you go into debt, you eventually reach a balance of income and expenses. (Or you declare bankruptcy.) You can’t keep going into deeper debt indefinitely. If you’d taken those same actions to equalize income and expenses before going into debt, you’d be better off.
Edit to “spending money they do not have for unnecessary purchases at huge interest rates”.
Obviously, certain circumstances can cause someone to need to use credit card debt to shelter/feed themselves and their family. I would be willing to bet the vast majority of credit card interest is not caused by essential needs.
It's not useless at all. There are countries where the average workers earn 5 times less (even PPP adjusted) than our minimum wage and they don't rack up vast amounts of credit card debt, car loans, etc.
We first need to start changing our values to be more financially conservative. Once that happens and voters start making these values apparent to politicians, they can take actions that will help reduce costs for citizens.
> We first need to start changing our values to be more financially conservative.
Think about the economy! If political leaders were wanted the elderly to sacrifice thier lives to COVID "for the economy", then the overspenders have no chance of being save from bankruptcy. The purpose of a system is what it does, and the American one moves money upwards.
There’s a huge difference between borrowing money at 5% (and this loan is collateralized) to pay for a car you commute to work in, and putting a $10,000 trip on a credit card at 24% interest and then making minimum payments. The former is a good idea, the latter is a terrible idea.
I doubt it would make much of a difference. The kids with the wherewithal to take and pay attention to a finance course would be able to figure out "high interest debt = bad" on their own. The other kids wouldn't pay attention anyway.
Really, an hour on Google will give you all the information you could need to manage credit cards. It's not complex.
> the education was sufficient to understand the concept of not spending money you do not have
My public schooling in a podunk county TN had no component for financial management.
Even so, you assume that such education exists in a vacuum. It does not. It runs counter to a deluge of culture and advertising that tries to induce people to go into debt the moment they are able to pass a credit check.
My high school in a town-that-refused-to-admit-it-was-a-small-city had no course called "basic math". Compound interest was taught in exactly two classes: calculus and economics.
Economics was a de facto personal finance class, which was nice. It refused to admit that because "economics" looks better on a transcript than "personal finance". This meant it was a rarely taken elective for folks who wanted to look good to colleges.
Calculus was also an elective for folks who wanted to go to college, which was notoriously more difficult but more popular in spite of this. People not going to college weren't taking either one.
I believe grandparent that compound interest wasn't taught anywhere in a small public school. A lot of those schools don't even offer calculus.
I went through the U.S. education system in 8 different states in schools in poorer areas, and even then, the education was sufficient to understand the concept of not spending money you do not have.
Set the thing to auto pay the balance every month, and do not spend more than you earn. I expect that much from the 95% of the population that has had the opportunity to learn how to read and write.