Are you using credit cards to boost your self-esteem?

A recent article on reveals that many young adults get an intense adrenaline rush when using credit to finance the lifestyle of their dreams.

Access to credit makes them feel they have prepared to meet the challenges of the future, the article suggests. The article is derived from the recent study performed by Ohio State University: Youth debt, mastery, and self-esteem: Class stratified effects of indebtedness on self-concept.

The study concluded that when young adults who are from poor and middle class backgrounds used student loans and credit cards to finance their lifestyles, "they felt a temporary but powerful boost in self-esteem and in feelings of mastery over their environment."

The results of this study aren’t surprising. Young adults have the second highest bankruptcy rate in nation and the average indebted young adult spends almost 25 cents of a dollar on debt payments, according to a study by Demos.

While having and using credit is useful, measuring your self-worth by your credit limit can lead to a burden of financial turmoil.

Below are five ways to use credit responsibly and establish healthy financial habits to insure financial wellness later in life. Besides, one of the best self-esteem boosters is providing for your financial future and building a solid nest egg.

  1. Only purchase items on a credit card you can afford to pay back within three months. For larger purchases, consider saving for it or commit to a strategic payment plan if using credit is necessary.
  2. Don’t exceed your credit limit. Most financial experts, such as Money Management International, recommend not using more than 30 percent of your credit limit. Anything over that can lead to a mountain of credit card debt.
  3. Pay more than the minimum amount due. I once read that to pay off a balance in a reasonable time frame and avoid excessive interest is to multiple the minimum payment due by three and pay that amount.
  4. Don’t miss a payment. Do whatever you can to remain current on bill payments. Consider using calendars, agendas, and to-do lists to remember credit card due dates. Missing a payment can lead to late charges and other fees.
  5. Know and understand the interest rates on each credit card. Make sure you are aware of interest rates, over limit fees, rewards and points, etc. Understanding you terms better you will help you make better financial choices.

If you are dealing with using credit card to boost self-esteem, you might also be interested in reading From spendthrift to saver to learn the warning signs and get solutions to control shopping temptations.


Renee McGruder is a former communications coordinator and grant writer at MMI.

  • The Consumer Federation of America (CFA) is an association of nonprofit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education. Today, nearly 300 of these groups participate in the federation and govern it through their representatives on the organization's Board of Directors.

  • Since 2007, the Homeownership Preservation Foundation (HPF) has served as a trusted, neutral source of information for more than eight million homeowners. They are partnered with, and endorsed by, numerous major government agencies, including the U.S. Department of Housing and Urban Development and the Department of the Treasury.

  • The mission of the U.S. Department of Housing and Urban Development (HUD) is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD works to strengthen the housing market in order to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; and build inclusive and sustainable communities free from discrimination.

  • The Council on Accreditation (COA) is an international, independent, nonprofit, human service accrediting organization. Their mission is to partner with human service organizations worldwide to improve service delivery outcomes by developing, applying, and promoting accreditation standards.

  • The National Foundation for Credit Counseling® (NFCC®), founded in 1951, is the nation’s largest and longest-serving nonprofit financial counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services.