Credit-Card Debt Nears $1 Trillion as Banks Push Plastic
Gather round and I&#x27;ll tell you a tale of how to lose at the credit card game.<p>When I turned 18, I got my first credit card. I asked my father &quot;good idea?&quot; and he said yea, good to build up credit. Ok then. A week later, my new card with a whopping limit of $750. Never having experienced <i>not</i> paying with cash I had, it gave me an odd thrill and I went out to eat with my friends and joked &quot;It&#x27;s like free money!&quot; And despite knowing better, it certainly <i>felt</i> like free money because the numbers didn&#x27;t change in my bank account. Sure I knew I&#x27;d have to pay it off, but whatever, I&#x27;d do that later.<p>Now, like all good citizens, I spent the first couple years always paying off the balance I owed. Nor was it long before credit card offers came to me and I said &quot;hey good to build up credit&quot; and signed up for them. My next big one had something like $1500 limit and I was 19. Soon enough, I was doing great -- my credit was high &amp; debt low -- looks good for credit.<p>Well, soon enough I was in Boston going to college and working part-time. One day at work, I got another one of these offers and thought &quot;why not?&quot; This time was special though because it asked me what is your household income -- not <i>my</i> income. Well.. my parents didn&#x27;t make much but we weren&#x27;t poor either, so I added together the incomes and said my household income was $150k. I felt a bit mischevious putting it down -- was it the truth? What was going to happen? Would they check to see if <i>I</i> made that much?<p>No, instead, they were more to happy to oblige and gave me (a 20 y&#x2F;o) a new credit card with <i>$12,500</i> limit. Holy shit! I thought to myself, I have a LOT of free money! Over the course of the next 4 years in college, I would eat out whenever I pleased and generally kept my credit under control, but slowly &amp; surely my credit usage was rising. Fast forward a few years after that, and I have a total credit line of about 30k -- all maxed out. Was I being outright financially foolish ordering $100 bottles of Chardonnay at the club? Not at all. Was I being financially negligent ordering whatever small thing came my way that I wanted? Yes -- because I could.<p>So then you find yourself in deep debt, and what do you do? You start paying the minimum off and then re-using that credit. Do you care so much about paying it off? No that seems like an eternity away, paying the minimum is easier. Do you know it&#x27;s wrong? <i>Of course</i>. Do you care? Not as much as you should.<p>This my friends is how you lose at the credit card game and end up just paying fees to bank execs. It can be fun, but I do not recommend.