What is wrong with using a credit card if I pay it off each month?
Have you ever mailed a letter just to find out that it got lost in the mail? Or maybe it should have taken two days to get to its destination, but it really took four days? When your payment doesn't make it to the credit card company on time (for any reason), it is your responsibility. A single late payment will not only ding your credit score, but it will also cost you in added interest on the unpaid balance, as well as the late fee. Also, if your payment is due on a federal holiday, when the mail won't be running, it is your responsibility to make sure the payment gets there the day before the due date. If it shows up on the day after the holiday, it is late, and you will be liable.
In addition to the extra stress about making sure the mail gets through, most people will spend more when paying by credit card. Some studies say that the average person will spend 12-18% more when paying with plastic, than if they were using cash. There is an emotional reaction when you pull out cash and hand it to the cashier. You feel the difference in the amount of money you have when you hand over the cash. When you swipe the card, you don't have the same reaction. As a matter of fact, most people don't even pay attention to the total price when paying with credit.
The last thing I want to say on this topic deals with the perception of the world when it comes to credit. If you believe the Visa commercials, anyone desiring to use cash is going to disrupt the smooth flow of capitalism. The next time you are in the checkout line, notice the length of time it takes someone to checkout when they are using a credit card. When it is your time, throw down some cash and see how long it takes for you to complete your transaction. Unless the cashier is confused about how to make change, you should be done in less time than it takes the authorization to come back on the credit transaction.