01/18/2012 09:58 pm ET Updated Mar 19, 2012

Credit Cards May Not Be So Bad, After All

Because these things will change, can you feel it now? -- Taylor Swift

In my book, Wealth Without Wall Street, and in my newspaper column I've had one constant mantra.

Credit cards are evil.

They are issued predominantly by "too big to fail" Wall Street banks. Some cards charge outrageous rates of interest and seem to have fees hidden everywhere.

I've watched tons of people, especially college students and young people, get in serious trouble with them.

I went over a decade without a credit card. I've proven you can live without them. I've bought a nice house, rented cars, traveled extensively and knocked down every argument about why a credit card is somehow necessary in American life.

I've made my point.

Now I am saying that some people, especially small business owners, might want to think about getting a card and using it wisely.

Why the change? Have I morphed into Mitt Romney and started flip flopping based on opinion polls?

It's a little more complicated.

I keep running into people who handle a credit card responsibly. They pay them off every month. They move their money to cards with zero interest rates or do things that make cards financially advantageous.

In the words of the people at Budweiser, they know when to say when.

If they can handle a card, maybe some of us can, too.

I remain a staunch advocate of moving your money from a "too big to fail" Wall Street bank to a bank or credit union in your community.

It will be a cold day in hell before you see me flashing a Bank of America or Citigroup credit card.

The companies did a lot of things wrong, were bailed out by taxpayers when they should have been allowed to fail, and continue to look for ways to stick it to the consumers.

The recent example of Bank of America trying to charge a five dollar a month fee for using a debit card is an example of why Wall Street banks are completely out of touch with Main Street. Don't send them your money or use their products.

Many local banks and credit unions offer credit cards with low interest and good terms. If someone wants a credit card, those are the places to start.

At one point, I followed the model of radio commentator Dave Ramsey and Larry Burkett (a Christian financial writer who was a big influence on Ramsey) and took all debt all out of my life.

Then I bought a house two years ago. I planned on buying a house that I would pay for in cash.

A friend, who is a financial genius, explained to me how locking into a long term, low interest rate mortgage made sense. I made a good down payment and bought a house I could afford. I got a good deal on the house because previous owners had to sell quickly.

Mortgages aren't bad. Buying a house you can't afford is the problem.

With rates below four percent, anyone who can get a long term mortgage ought to be thinking about it. Also, it is a great time to refinance your home, if you qualify.

It ought to be a great time for a small business to get a loan. Banks are flush with deposits.

Unfortunately, they aren't giving the money to small businesses.

I hear horror story after horror story about how solid businesses, with solid track records, can't get a loan at all, or the terms are absolutely draconian.

I have a friend in the construction business. No one is throwing money at anyone in construction but he has survived and is doing well. When contractors are slow in getting him money, he has turned to running up his credit cards to make payroll.

He doesn't use the cards to go to fancy restaurants or take the family to Disney World. He uses them to keep the doors open and stay in business for another day.

As soon as he gets paid, he immediately pays the cards off and they remain his "rainy day fund."

As I noted in my Wealth Without Wall Street book, I've been down on credit cards since I didn't handle them well in my youth. I got seriously in debt and took several years to get out. That experience led me to my hard core stance against credit that I've kept for over 20 years.

I've gotten hundreds of people to cut up their cards. I'm thrilled that they do.

For me to "allow" people to use credit, even in a limited manner, is like when Nixon went to China or when Rod Stewart started doing disco albums, it goes against all my previous history.

On the other hand, like Nixon made the trip to China, I see the big picture. The occasional use of credit might be advantageous.

Although I open the door slightly on credit cards, I caution, again, with the words of Spuds MacKenzie, the Budweiser mascot from the late 1980's.

"Know when to say when."

Don McNay, CLU, ChFC, MSFS, CSSC is the bestselling author of the book Wealth Without Wall Street: McNay, who lives in Richmond Kentucky, an award-winning financial columnist and Huffington Post Contributor. You can learn more about him at

He is the Chairman of the Board for the McNay Settlement Group ( which provides structured settlement consulting for injury victims, lottery winners, and the families of special needs children.

McNay founded Kentucky Guardianship Administrators LLC, which assists attorneys in as conservators and setting up guardianship's. It is nationally recognized as an administrator of Qualified Settlement (468b) funds.