Why Credit Cards Are Like Taxes!

How in the world are you going to tie those two together. Well, it’s actually quite easy and I get to use the wisdom of the Federal Government. wink wink. Stephen Moore and Richard Vedder have done some incredible research about raising taxes in the U.S.

In an article they posted in The Wall Street Journal, thank you Marsha Blackburn, they show that post World War II through to 2009 for every $1.00 of new tax revenue raised politicians spent $1.17. As they put it, “Politicians spend the money as fast as it comes in—and a little bit more.” If you are a proponent for higher taxes because bureaucrats say we need them…WAKE UP!

Okay, now that that’s out of the way, what does that have to do with credit cards? Well, the average person has a tendency to think the same way as the government when it comes to spending with credit cards. If I have it, I can spend it…and then some. I remember when I was eighteen years old, in one week I got a Visa, MasterCard, and an American Express.

I was on cloud nine. I could buy anything I wanted, that I couldn’t afford at eighteen, and all I had to do was pay the minimum payment! Uhhhhh, except on that last one. Nobody told me that you had to pay off the Amex balance every month. So I didn’t. Then one day while I was in a video store renting a VHS movie (some of you may have to Google what VHS tapes and video stores were, uh, are) it was taken from me. THE HORROR! THE EMBARRASSMENT! I couldn’t believe what had happened, and with people around me watching. But I’m the dummy who for a few months spent way more than I actually had, and when I saw the statement, I just sent in what I felt was doable.

The great thing was that I still had two cards that only required me to pay the minimums. I continued to spend like I actually had the money, and ended up in trouble down the road. Does it sound familiar to how our government handles taxes? But there’s a way for you to actually reduce your “deficit.” It’s called living on less than you make!

I know, it’s edgy, but it actually works. “But Chris you don’t understand my situation!” Really? I bet it’s you who doesn’t truly understand your situation. Here’s what I know, every time you don’t go into debt, you don’t have to pay any debt off! Every time you don’t spend everything you make it leaves you with this funny thing called cash.

Say it with me, C…ASH, C..ASH CAASSHHH. See, that wasn’t so hard. So here’s an idea, get serious about getting rid of the debt that you have. Get on a plan of spending with cash, and don’t spend everything you have! Then you can truly begin to enjoy life without the stress of not having money. It gives you more room to stress about the way Government spends.