I don't think you came off as A-holish so no worries there.
I think your position is admirable and wherever possible, not using credit makes a lot of sense. But your key word is "planning" and my keyword is "discipline". If someone wants to float me a no interest loan for 18 months then why not take advantage of it? You just have to be disciplined enough to make your payments every month and stay within your means.
I like this topic, thanks for the interest in reading my views on it.
It's not about interest, it's about payments. Payments destroy cash flow. The minimum on a credit card with a balance of $1,000 and a 0% interest rate is most likely $29. The minimum on a credit card with a balance of $1,000 and an 18% interest rate is most likely $29. Man, how tempting? A 10,000 car loan @ 0% for 60 months is $166.67/month. A 10,000 car loan @ 8% for 60 months is $202.76/month. Yeah, interest costs money, but interest free doesn't negate the necessity of having to make a payment, either way. Interest in my auto loan example is a measly $36. It's not like I'm suddenly rich because my auto loan is 0%. It doesn't solve the problem of owing someone else for something. I like to own what I buy.
The problem with financing toys, or "small crap" is that it's a hassle to me. The first time the bank doesn't process my payment like they should, or takes it out early because the due date lands on a weekend that month, or anything else annoying happens, it's a pain in the ****. It's a phone call or an office visit I shouldn't have to make over something stupid that I could have just paid cash for if I had the "discipline" to put $20/month into an envelope. Planning and discipline go hand in hand. Planning is easy, but it takes discipline to actually do it. With really great credit, you can finance a Moto X for 0%. So that's what (for easy math), $92, $46, or $31 a month depending on the term (6 months, 12 months, 18 months). Or, $20/month into an envelope because I *know* I'm gonna want a shiny new smart phone. My option is the cheapest, and it's interest free. Plus, I owned my phone for a smaller payment to myself than the guy who let's whoever does Motorola's financing own his phone until he pays it off.
I spent a little time working for Well Fargo Financial after college. These types of accounts are extremely profitable to banks because most people do not pay them off. Most people don't understand that if you miss a payment, back interest will hit for the full term of the store account. If you fail to pay the whole thing off in time, back interest will hit on the account. It was the #1 complaint our branch received every month. Some stupid shmuck that got sold some crappy, over-priced furniture failed to realize that his $1,000 bill turned into $2,800 all because the bank actually was serious about that back interest thing.
I remember one time where a customer came in with a complaint. He had purchased a few thousand dollars worth of furniture from Ashley Furniture, and like a good Wells Fargo customer, he used his shiny Wells Fargo credit card to autopay the payment every month. The problem was that his card had been skimmed, and shut off for "security" reasons a few days before his payment on the furniture was due. He didn't know, and the payment didn't go through. In fact, he didn't find out until he tried to use that card over a week later for a transaction that was declined. This caused his account to go delinquent and stacked on an insane amount of back interest. I've never seen someone more pissed. Did Wells Fargo show mercy and fix the problem? Hell no they didn't, and they lost a customer over it too. The cynic in me is tempted to believe someone at the bank flipped the switch on a "fraudulent transaction" just because the poor guy was at something like payment #50 of 60 and hadn't skipped a beat yet. Nope, can't afford to miss out on the interest for all that!
It's unnecessary gambling. Every payment that is due is transaction that is ripe with the opportunity for something stupid to go wrong. Granted, a $500 phone isn't the same thing as $10,000 in furniture. But the difference is that when life hits the fan, and it will hit the fan eventually, your payments are something that risk breaking your back because you don't have the cash to pay them. However, my cash sitting in envelopes for relatively unimportant things like cell phones and vacations have the ability to serve another purpose - like paying off an unexpected bill without disrupting cash flow or touching real, physical savings. Cash in hand is worth more than credit on a card, every single time.
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