The Things You Need to Know About Credit Cards

Credit cards are like fire, if you know how to use it, then it can be a very valuable tool in daily living. However, if you mismanage it and abuse its uses, it will hurt you, and it will turn your finances into ashes.  

Credit cards are not inherently bad, not like the advertisement or the false information that is being spread on the television or the internet. It is up to us on how we use it, and it just takes a little education to illuminate ourselves on how better to utilize it. To help you in this aspect, here are the things you need to know about credit cards. 

 Credit Cards

The Advantages of Credit Cards 

Let’s start off by discussing the advantages of credit cards. One of the benefits of having a credit card is purchasing power, which makes things a lot easier and convenient for you. You can purchase almost anything in your local store or anywhere internationally without the hassle of converting cash. Credit cards are also excellent when used in purchasing online, some items that are offered in discount are not offered via cash on delivery method. 

Another huge advantage of having credit cards and using them properly is that you earn rewards. The reward that you will receive would depend on the bank or the institution that owns your card. As you purchase and pay off your credits, you will earn points which are the basis of rewards. You can acquire plane tickets, car rentals, hotel accommodation, gadgets, and other things. 

Another advantage of credit cards is that you can avoid losing your money through misplacement or theft. We sometimes lose our wallets, unfortunately, when we accidentally drop or left it somewhere or that someone stole it. In either case, when your wallet is gone, your cash and your money are also gone. On the other hand, if you are using a credit card, you will only have to pay some penalties, and you still retain the bulk of your money. 

The Disadvantages of Credit Cards 

One of the most obvious drawbacks of using credit cards is the interest rate. When you fail to pay up your expenses, you are not only paying your credits, but you have to also pay for interest. This may seem not harmful on the first instances, but if you acquire this habit, the creditos will accumulate, and it will slowly eat up your finances. You will then find yourself on quicksand, unable to escape the debt that seems to keep piling up. 

Aside from interest rates, your finances can be unnecessarily get chewed up by late fees. You are charged when you pay your credits late, and if this happens often, this fees can accumulate and can cost you your dear money. 

Another disadvantage of having credit cards is that it can create a bad habit of compulsive buying. This is because it is very easy to buy anything with a credit card, with one swipe then you already have it. Some people get to kind of get addicted to it, and they purchase things that they don’t need.

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