“Debt is poverty of a different kind”.

I am not referring to the USA National Debt – though there should be real concerns about it.

I am addressing credit card debt.

There are 7.3 Billion people on the planet.

There are between 3-5 billion credit cards on the planet, and rising.

Billion, with a “B”.


I am one of those who landed in trouble with it during the global financial meltdown and it took me more than 7 years to overcome my (a) bad habits and (b) the debt I racked up.

Seven+ years of my life.

  • Is there anyone here who has had the same experience?
  • If so, what was / is your biggest frustration, fear and challenge in this area?


Allow me to share a few things on my next four blogs on credit cards and bad credit


  • As stated above, an estimated 3-5 billion real (not fake) credit cards exist today – and the number is increasing.
  • No-one knows how many fake cards there are, but I have been a victim of at least two.
  • The average credit card debt per USA household is about $16,000, with a total for the country pushing towards ONE TRILLION Dollars.
  • More than half of the cardholders had an unpaid balance in the past year.
  • For more than a quarter their credit card debt had increased in the past year.
  • Students have an average of $20,000 debt.


At the depth of my debt I was around $60,000 under water – almost 4 times the average amount. And that was 15 years ago!


We all know the benefits of credit cards and I will bullet them here, followed by the negatives – of which there are real social impacts.



Convenience: The main benefit is the convenience of having “money in your pocket” – up to the maximum credit limit, which is in fact a short term loan to you.

Loyalty programs: Another main benefit nowadays is of course the loyalty programs where the card holder gets loyalty points which can be redeemed for products or cash.

Bills tracking – Help with budgeting: Your account (soft or hard copy) can also help you to track expenses at the end of a period – which may bring back both good memories of where you have had your lunches and dinners – but also remind you of the carefree and perhaps careless spending that you did.

Product returns: A further benefit is returns. The buyer can return a product and receive (part of) a refund.

Extended warranties: Cards can also provide extended warranties and loss and damage covering.

Insurance: Some cards will also offer insurance, often on cars.

Legal limits of liability: In some countries (such as the USA and UK) have introduced legal limits of liability for those who lose a card or has a card stolen.



Inflated prices: Consumer prices are inflated to pay for all these benefits. And it affects everyone who shops, not only those who use a card.

Discipline: The most difficult one is probably one of self- regulation, or discipline when it comes to using credit cards. But then again, that is not the card’s fault.

Surcharges: Some businesses may ask the buyer to accept a surcharge on a credit card transaction, since the business often has to pay the card company a fee (of up to 4% of the value of a transaction.) This of course leads to higher prices.

Social impact: Some organizations are of the opinion that it may in fact also impact social welfare on two fronts (a) higher prices and (b) the high interest rates that card companies charge. This often drive lower income earner card users into debt and even bankruptcy – which has serious social side effects.

It is all well and good to say that there should be strict filtering and vetting of those who may own a card, but there had been times in the past when card companies would actually just send a card to person on their email list. I can personally vouch for that.

Increased rate shock: Financial institutions (mostly banks) will offer you a ZERO interest rate card to consolidate all your competitor cards with them. However, these zero fees run out after a period of time or a specific event and then also revert to high interest rates.

Tread carefully with this.


My next blog will look at the impact of when people go into bankruptcy due to over-extending themselves on credit cards.

I am aware that some people have started very successful businesses by using their credit cards to fund them, but – and there is always a “but” – I don’t think that is a general way of funding an upstart business.

  • Does anyone have comparative data on failures and successes?


Please feel free to comment, especially on my questions, i.e.

  • Is there anyone here who has had the same experience?
  • If so, what was / is your biggest frustration, fear and challenge in this area and during the time you are / were in debt?


Thank you.

Kris Moller


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