The Long Reach and Implications of Credit Cards

Since the 1960s, credit card companies have been investing tens of millions of dollars a year in “training” us that we can’t live without their cards. It started with “just for emergencies,” the still-popular “just in case” and “ease of financial planning” to the point were one out of seven Americans now has 10 or more of them. It’s also been so long ago that few people still remember that Visa used to be called Chargex and MasterCard was called MasterCharge.

But then – those names sounded too much like a bad thing. Both of them kind of sounded like debt, and that’s the last thing they want us to think. But their marketing goes a lot deeper and is a whole lot smarter than the current Visa ad campaign that “Life Takes Visa.” Well, life takes cash, too – but fewer and fewer people have any of that, so it’s not really a stumbling block to Visa anymore.

After hooking adults to the point where we now owe nearly $900 billion on revolving debt, the two other large groups of “credit card trainees” for the card companies are students and kids. After all – do a proper marketing job now and you’ve created another two generations of slaves to their minimum card payments. When it comes to Kiddie Branding, it’s important that kids learn really young the necessity of a credit card.

So a few years ago Mattel’s Cool Shopping Barbie came with a MasterCard. Yes, MasterCard paid a lot of money to be the exclusive sponsor. But it was worth it – sort of.

Barbie came with a full-sized card (just like these 4 to 6 year olds will have in just a few years) and a cash register where kids could swipe this card (gotta learn that, too) and it would exclaim: “credit approved!” Yes, sick – and it was and is one of the few times when enough stink was raised by parents and organizations, such as the Consumer Federation of America, where Mattel actually withdrew the doll. Rare – but it happened.

That didn’t stop the credit card companies though, it just makes them smarter and maybe a little more stealth. The game Monopoly in the UK now comes with Visa cards. Yup – cash is gone – credit cards are in. Makes me wonder how long before the North American version gets “improved”? But game maker Hasbro has gone one step further. Their Game of Life being released later this summer will now use Visa cards as well. And no more spinning wheel, but an electronic life pod.

I don’t know what that is, and I’ll never know, as I’m sure not going to be supporting a company that is sponsored and paid by Visa in such a huge and flagrant way. After all, this is (hopefully was) one of the most popular games that’s now been taken over by the credit card companies spending millions of dollars of ad money.

Hmmm, Visa is going to teach our young people money skills? Yes, and Michael Vick is going to start teaching us how to take care of our pets! But then, 85% of teenagers don’t take a course of finance or money management in school – so it’s not like Visa has to work very hard to replace some training – there isn’t any! What are the lessons for kids? Cash doesn’t work.

You need credit cards to be successful, happy and a winner in life and if you want something you really ought to have it today – never mind if you can afford it or not. Life takes Visa (and MasterCard), and by the time these kids are of legal age – who knows? Maybe life won’t actually take cash anymore.

Because right now, who’s teaching your kids, and what kind of financial role model are you? After all – they don’t learn what you tell them – they learn by watching you! George Boelcke, FCI is a financial consultant and speaker. With more than 25 years of experience in finance, banking and credit management, George has a degree in credit management and is a member of the Credit Institute and the Association of Finance & Insurance Professionals.

In addition to his frequent media appearances and weekly radio tips, George is the author of the US, Spanish and Canadian bestselling books: It’s Your Money! Tools, tips & tricks to borrow smarter and pay it off quicker. For questions, feedback or suggestions for future columns, George can be contacted through: www.yourmoneybook.com Since the 1960s, credit card companies have been investing tens of millions of dollars a year in “training” us that we can’t live without their cards.