I should have differentiated between using short term credit and taking on debt, which are very different things.
Certainly money management is a very personal thing.
Here's one recent example. Just bought a CRV. 25k. Wrote a check. At your 1.9%, I pay an additional $1,226 for the vehicle. That's almost a 5% up charge for the privilege of not using my cash. Figure inflation is running at 3%. The devaluation in your cash sitting in your bank making 0.008% (thank you Fed) over those 5 years is about $3,500. Further, even people with "good" credit are likely going to pay a higher interest rate, not the 1.9% dangled out.
Disagree. Most people, in fact, could do this. The problem is the early life training to live beyond their means. Why save the money and buy a serviceable used car for 8 or 9 grand when you can take 15 grand in credit and buy a brand new, shiny 25,000 car with heated seats?
To clarify my advice, I definitely recommend using credit cards and lines of credit. I pay for 80% of expenditures with a Capital One card that gives me 1.5% on everything. Of course, I pay it off each month and never pay interest. I also have a HELOC that I use for things like buying cars. The truth is, the 1.5% cash back on the credit card is a tax on people who are carrying balances every month and paying 20% interest. Just like when I pay my property taxes early and get a discount - that's just a tax on the people who pay late and get hit with a fee.
My thought on this is that debt is generally bad, and should be avoided. That is a drastic over-simplification, to be sure. But for a thread on a basketball message board, I err towards simplicity. Certainly taking on debt now to improve financial status later usually makes sense. Examples include loans for education. Also, improving standard of living now by taking on debt sometimes makes sense. For example, taking a loan to get to a house in a better school district.
Ultimately, however, debt is a life choice, not an obligation with which we are born. The United States is a cultural echo chamber on this. It is beaten into your head from a very young age, directly and through suggestion, that taking on debt is normal, expected, and a tonic for your life.
Fundamentally, debt is the process by which you improve your standard of living today by lowering your standard of living tomorrow (excepting some education loans, business loans, and other debt taken to increase earning potential). Further, the amount that you improve your standard of living today is substantially less than the amount you lower your standard of living in the future, and that really is the thesis here; taking on debt is the process of making yourself a little wealthier now at the expense of removing multiples of that wealth from your future self. People think they "need" things that they really just want, and they end up paying 24% interest on a steak they bought at Outback that wasn't that good anyway.
