In today’s world, people take for granted that credit cards are not only desirable to have because of their convenience, but also for their ability to buy goods without having to have the money on hand; yet, there was a time not so long ago, when credit cards did not exist, whatsoever, but somehow business was able to be transacted all throughout the United States, through checks, cash, as well as credit given by local merchants such as a grocery store, for certain customers. So then, for a certainty, life would not end without our ubiquitous credit cards, but it would be different if credit cards simply did not exist.
The very first thing that would happen without credit cards being the go-to usage of how we purchase goods, would be a significant drop-off in items being purchased, because many a family purchases goods with a credit card, as opposed to a debit card, because they do not have ready access to the funds necessary to make that purchase. This would presuppose that auxiliary purchases of goods that are desired but not really necessary would be reduced considerably without credit cards, though, perhaps, over a long enough period of time, people would adjust to this lack of ready credit, by saving more and then spending those savings on the same sorts of goods that they use to purchase with their use of a credit card. That said, it has to be admitted that when people pay for goods with cash, or a check, or a debit card, it feels much more real to them, because it is in effect, going to reduce their bank balance, immediately; whereas, with a credit card, because there is not that instant hit to one’s bank balance, it is easy to dismiss what is being charged, as something that will be taken care of, at some future point, and therefore not something to worry about.
It could also be argued that life without credit cards could well mean that family budgets and thus their savings would materially be improved, for we have to keep in mind, that credit cards and the fees so associated with those cards, such as late fees, penalties, and high interest rates contribute to families budgets being materially negatively impacted, because money that they would have had in their possession, has now gone or is earmarked to the banks that issued those credit cards. After all, we read at lendingtree.com, that “Americans’ total credit card balance is $1.129 trillion in the fourth quarter of 2023,” which signifies that with credit card interest rates being fairly commonly set within the range of 18-27%, Americans with credit card balances that are not paid off in full each month are paying a very high price for the borrowing of that credit.
Indeed, those who would be most concerned about how they would survive without easy access to credit cards, are typically the very same, who are using those credit cards primarily as a crutch to carry them through from one crisis to the other, mainly because their expenditures are higher than their income, and without those credit cards, it could be argued, they might well find themselves in a better place, in which by tightening their belt, life actually didn’t actually end up becoming worse, but may have become better, because they had now been essentially forced to live within their means.