…Nicholas Souleles of the University of Pennsylvania and David Gross of the consultancy Compass Lexecon calculated that the typical consumer unnecessarily spends $200 a year in interest payments by keeping a sizable stash of cash in savings or checking while at the same time carrying a credit-card balance. In our heads, the two don’t line up.

Time recently posted an article about the problem with credit cards – “The Real Problem with Credit Cards: The Cardholders.” This is true, spending is not the same for any two people. My credit card usage leans toward using my cards as cash. In my mind – paying interest is bad, earning interest is good.  I may not have the cash today but I will before the bill comes or I just don’t want to carry around a lot of cash. No problem. I can do a quick calculation and determine whether or not I have enough to buy what I want. For larger purchases, they are generally not spur of the moment purchases. Even so, making several purchases for $50-$100 can soon throw a budget out of whack – great interest rate or not.

The credit card problem debate is like the gun debate. Guns aren’t bad if you are using them correctly. Some people should never have guns and do not use them wisely. Even people who hunt for food with guns know that these instruments can do great damage. Credit cards are the same way – these are financial instruments that should be used wisely. Some people should have never ever, ever had a credit card in the first place.