Kevin O'Leary Has A Trick To Break The Credit Card Trance: Here's What He Wants You To Look Closely At

Kevin O’Leary, the famous investor from “Shark Tank,” has shared a smart method to break the addictive cycle of credit card spending, urging people to look closely at the long-term financial cost of their impulsive purchases.

What Happened: In his book, "Cold Hard Truth on Men, Women and Money," which was originally published in 2012, O’Leary spoke about how many people are trapped in a “credit card trance,” spending money they don't have, reported The Street.

According to O’Leary, when people buy items on credit, they often fail to consider the true cost of those purchases, particularly the interest paid over time.

He encouraged readers to ask themselves before each purchase: “Will the interest I pay on this item outlive my interest in this item?” If the answer is yes, O’Leary advised against making the purchase.

The investor also warned that using credit cards for emotional relief, or “retail therapy,” is a dangerous habit. "I love money because, employed properly, it's a source of creative energy," he wrote in his book. "Stuff, on the other hand, merely uses up energy by killing money."

Why It’s Important: O'Leary has often described consumer debt as "the silent killer." Back in February, he told Graham Stephan on his podcast that he avoids debt entirely, paying for everything with cash.

He's not alone in warning about the dangers of credit cards. Mark Cuban, another billionaire from Shark Tank, earlier told Dave Ramsey on The Ramsey Show that using credit cards is a barrier to building wealth. “If you use your credit cards, you do not want to be rich.”

Earlier this year, in March, Synchrony Financial SYF, the biggest private-label credit card issuer in the U.S., said that persistent inflation is pushing consumers to cut back on spending.