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  • Writer's pictureJohn Savage, Author, CFHC

Think About It: Before You Take Out Credit!

Updated: Jan 14, 2020

Before you take out credit, there are many things you need to consider. It best to first have a steady income, some type of emergency savings and solid and discipline focused to managing and tracking your money on a weekly and monthly basis. This are just some of the basic foundational things that I recommend for multiple reasons. For one thing, if you have an emergency situation arise where you need to take care of something quickly, you won't be so tempted to run to your credit card first but you can go to your reserves to manage the situation wile it is well within your ability to do so.

Often times when a person runs into a financial crisis, they look to borrow money from a loan shark, high prime lender, they skip out on paying the most important necessities first out of panic and thinking through it or they just put it on a credit card. If they don;t have a credit card they apply for one and if approve, they immediate put it on the card. I get it, often times when we run into a challenging situation, life can be tough, filled with a list of uncertainties or other unforeseen obstacles that can pressure us and overwhelm us with stress. I have been there myself and know what it's like when you are attempting to exhaust all your options based on what you know but to no avail. This in and of itself can be a very daunting task. With that said, this is why I do what I do, every day I work with people from all across the country who are literally living their lives in quiet desperation with no light to lead the way of their current situation.

One of the first things I constantly remind people about is that you are more important than that bill, that challenge, or that circumstance and that they can and will get through it. With faith, patience, and a bit of determination, the human spirit is resilient and can come up with a solution to even the most tumultuous situations.

One of the first things I recommend before taking out credit on anything is to pause and reason with yourself in a very practical manner as to why you are even considering taking out credit in the first place? Is there an emergency? Have you over spent and now put yourself in a bind? Is there some thing you fill impulsive about and just have to have it? Is it a medical situation that you don't have the money of rand you see no other options? Is it a vacation you've been wanting to go on and you don't have the money so you decided you would like to put it on credit? Or, are you newly immigrated to the United States or have virtually no credit and your seeking to build your credit file for worthy purchase in the near future?

I pose these questions because they are the situations and real life scenarios that people are faced with and musing over everyday. The credit game is mixed with both impassivity and responsible money management. Managing and building credit is like two partners dancing, it can be like doing the waltz or doing the stanky leg or the mash potato. They each have a different beat, rhythm and pattern and guess who determines the dance you are going to have with your credit profile? You guessed, you are! And what you've learned up to this point is going to determine the dance you dance.


This is where it is so important to seek out wise counsel and explore all your options before you make the decision to use credit. Like with any dance, if you do it right, it will smooth, thought fun and well danced. Credit is the same way. When you equipped yourself with the knowledge combined with discipline, choosing credit and the type of credit will be clear and well calculated.

For example, if you travel a lot on business or for your job or other contract work, getting a high rewards travel credit card may make a lot of sense, especially if it comes with a lot of perks such as Centurion lounge benefits, TSA access pass, hundreds of dollars in cash back, and thousands of dollars worth of bonus points in free flights throughout the year. Or maybe you like to shop at Costco because you have a large family and you save on certain bulk items and you like their gas, then getting a VISA charge card that give you 10 cents back on every gallon of gas and $50 cash back on every $500 dollars you spend then makes a lot of since. And when the have special deal on your regular purchased items, you save that much more money while gaining maximum value have this card in your wallet while also building and establishing a solid credit history over time.

What ever your reasoning for getting credit, just make sure you give it a solid purpose that benefits you and your family or your business in the long-term. Credit is a great tool and leverage for many future desires, goals, and pursuits to those who understand how to rule over it. I leave you with this, Proverbs 4:13-18 “Blessed is the man who finds wisdom, and the son of the man who finds understanding. For the merchandise of it is better than the merchandise of silver, and its gains than fine gold. She is more valuable than precious stones; and there is nothing to be compared to her. Length of days is in her right hand; and in her left hands riches and honor. Her ways are ways of pleasantness, and all her paths are peace. She is a tree of life to those who lay hold of her; and blessed are those who wait for her.”

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