What are the pros and cons of having a credit card?
Have you ever wondered whether it is better to have a credit or whether it is better just to use cash? Americans are bombarded every day with credit card offers through the mail, on the Internet, and at various banking institutions. Do we need credit cards?
Holding and using credit cards can be difficult sometimes. There can be temptations to charge more than you can afford. Being overwhelmed by credit debt is the number one con of having a credit card. Many consumers with good intentions only plan to use credit cards for emergency situations. Over time and typical life situations, Americans can find themselves drowning in debt. If you feel like this could happen to you, it is important that you make a monthly budget. A monthly budget will help you manage your money more responsibly.
Even though credit card spending can go out of control and cause large amounts of debt they are still needed for financial well-being. The major pros of credit cards that heavily outweighs the credit debt con are that to secure a large loan such as a home mortgage consumers need to build credit. Having credit cards on your credit report can be one of the most beneficial credit trade accounts you can have. Mortgage companies want to see how you can manage debt. If you have three credit cards and have ten years of credit history where your payments are on time with low credit balances you will find that this will work significantly in your favor. With little or no established credit you will not get approved, or you will need a higher down payment.
Credit cards make life more convenient, and safer. If your credit card gets stolen, you will only be responsible for the first fifty dollars. If your cash gets stolen, you will have little recourse in recovering your losses. Credit cards are now faster and easier to use than cash. Many credit card transactions today do not require a signature.
Credit cards will allow you to make purchases online quickly. With a credit card, you can make purchases fast and easy. Fast credit card transactions online let you shop in the convenience of your home. The con of not having a credit card is that it is tough to make purchases. Without a credit card, the only other real way to make purchases is through electronic checks, and not all online retailers offer that option.
Credit cards offer another pro. With credit cards, you can apply for a reward credit card. Reward credit cards allow you to accumulate reward points. You can earn these credit card reward points just by making everyday purchases. You will not get that benefit with using cash or with writing a check.
The pros outweigh the cons. Credit cards are a necessity that offers convenience to the lives of many Americans. If you are concerned that you may mismanage your finances, you will be able to find many resources online to help you. The easiest way to avoid this from happening is to limit the amount you charge and to make the largest possible payment on time every month. Following this simple formula can help your credit score improve. There is everything to gain with using credit cards properly.
Advertiser Disclosure for the CreditFast website – CreditFast.com, provides information about the best credit card applications, as well as other financial products and services. Our goal is to provide you with fair, balanced reviews. Some credit offers that appear on our website are from companies from which CreditFast receives compensation, and some are not.
- Milestone Credit Card Review – Milestone Mastercard® - February 21, 2023
- Capital One QuicksilverOne Rewards For Fair Credit - September 24, 2020
- Wayfair Credit Card Now Issued by Citibank Review - September 21, 2020
Interesting article but for now I want to stay away from credit cards. Right now I only work part time and I don’t want to rack up bills. I paid off my credit cards, and gave them to my Aunt. She will not give my cards back to me unless I get a good job or have a serious financial emergency.