We were told for many years, that because of the high interest rates charged by credit card companies, that we should attempt to pay down the outstanding balances by as much as possible, that we should strive to pay off our cards completely, and if we managed it, that we should cut them up and celebrate as we threw away the pieces.

A great number of people correctly followed this excellent advice, and it's likely that many are still considering it, but due to the current economic collapse, many experts and pundits are now reversing their advice, and are now telling us what almost amounts to the opposite.

They're not of course telling us to keep a ton of maxed out credit cards, and what's new is their recommendation that we shouldn't make more than the minimum monthly payments on our cards. They all stipulate however, within a percentage point or two, that we attempt to keep the amount that we owe to less than 20% of the amount that's available.

The reason for this new advice, is that what we owe on our credit cards is unsecured debt, meaning that the credit card companies can't come after our homes, our automobiles, or any other property that we might have, if we default on out payments. The popular thinking amongst economists right now, is that if anybody with a shaky credit score reduces his debt anywhere close to zero, that the credit card company will cut its losses and close his or her account.

In the event of something unforeseen cropping up, without a credit card with some available funds on it, you'd probably have to take out a 'quick cash loan' in order to get the money in a hurry, after which you'd have to take out a secured loan that offered lower interest in order to pay off the high interest 'quick cash loan'.

You'd then be stuck with a secured loan, and be continually concerned about what would happen if you couldn't make the payments.

A secondary reason for only paying off the minimum amount each month is so that you can keep some cash on hand. Imagine using all your available cash to pay off your credit cards, cutting them up, and then losing your job, or suddenly being landed with a large and unexpected bill!

Credit card companies everywhere are now lowering limits and jacking up their interest rates, so you have to hate them for gouging us, but at least we can stop them from closing our accounts, and we can keep them hoping that we'll keep making our payments, which will also guarantee good customer service.

This new advice has its downside of course, which is that we are going to be paying high interest on our outstanding balances, but the upsides are not only that we'll have cash or a credit card available if there's a sudden need for money, but we'll also be maintaining, and even improving our FICO score.

Finally, in case you still need a little convincing, try renting a car, or booking a hotel room, and after giving all the necessary information, tell the person on the other end of the phone that you don't have a credit card.