Woman Explains ‘How Credit Cards Work’ With Withered Human Fingers Story

Woman Explains ‘How Credit Cards Work’ With Withered Human Fingers Story

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Credit cards are convenient financial tools that allow you to swipe even when you don’t have enough cash. By paying for things on credit, you don’t have to worry about not having enough buying power now. Installments allow you to pay off your bills bit by bit.

But the bubble burst that led to the financial crisis decades ago reminds us how dangerous relying on credit cards can be. It is so convenient, but we often forget our financial limit that nobody will remind us of until the day we realize we are neck-deep in trouble.

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Tabletop game designer Avery Alder uses a fantasy story to illustrate how credit cards work.

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lackingceremony

Credit cards are similar to getting a loan. The difference is that when you loan for money, you get cold hard cash. But with credit cards, your purchases are completed, and you owe the bank for a month with little to no interest, under the premise that you pay them in time.

Ideally, banks offer their customers credit according to their ability to pay their credit. But this is not always the case, and it’s easy to fall into the trap of relying on your credit card limits instead of your financial limits.

At first, you needed that. You needed, perhaps, that new fridge to keep more fresh produce from spoiling.

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But with so much credit availability, it feels so easy to start swiping on things that you *want* as well.

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lackingceremony

The Harris Poll conducted an online survey on 2,033 U.S. adults for NerdWallet, revealing complicated results on Americans’ relationship with credit cards. At least 35% think credit cards are dangerous and even ‘evil.’

73% of Americans view credit card debt as inherently bad. Yet, almost half of Americans ‘wouldn’t consider filing for bankruptcy because of credit card debt’ no matter the amount.

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lackingceremony
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lackingceremony

The pandemic changes things, including the average FICO score in the US. Average credit card debt in 2020 was $5,313, down 14% from $6,194 in 2019. It was unknown what was the factor that pushed American’s ability to pay off credit, but the average credit score reached record number 710 in 2020.

Tom Quinn, vice president of FICO scores, explains that stimulus spending from the government and lender payment accommodations played the main roles in this improving statistics.

Play their game right, Alder warned.

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