The majority of Americans own a credit card. And more than half of all credit card holders use plastic for everyday spending.
But you'll rarely catch self-made millionaire Jay Leno using this common form of payment. "I don't lease things. I don't buy stuff on credit," the former "Tonight Show" host tells CNBC Make It. "If I can't afford it, I don't buy it."
That includes a home, Leno says: "I didn't buy my house until I had cash enough to afford it. Obviously, that's crazy. Not everybody can do that, and not many people can, but I was fortunate enough to do that and that's just my way."
"The idea of writing a check every month to something, that would drive me crazy," the comedian continues. "Just let me buy it. Here's the money, give me the thing, thank you, we're all set."
Billionaire Mark Cuban is similarly skeptical. Especially if you want to save more money, "don't use credit cards," the "Shark Tank" star and owner of the Dallas Mavericks tells CNBC Make It.
It's advice he wishes he'd heard sooner. "For me, the hardest lesson I learned was getting my credit cards ripped up," Cuban tells Money. "I would charge something and think I would be able to pay it off and then not be able to. I can't tell you how many credit cards I had ripped up."
Thanks to exorbitant interest — the typical credit card charges 16.7 percent — not paying off your balance in full each month can end up costing a fortune in the long run. Unfortunately, many people fall into this habit and don't or can't pay off their balances.
Credit card companies make it incredibly easy to spend money that you don't have: Most cards only require you to pay one percent to three percent of your balance each month, and that can be a tempting option if your budget is tight.
When you're getting started as an independent adult, it's important to establish good credit — that allows you to make larger purchases in the future, such as a car or home — and one way to do so is by opening a credit card. The good news is, if you stick to a few basic guidelines, you can easily use one without going into debt.
But if you find yourself not making payments in full, or if you have already racked up credit card debt, Cuban and Leno's cash-only solution may be the answer for you.
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