Benefiting from fraud protection, building credit, and earning cash backs are some of the ways you can take advantage of credit cards. With that said, it’s good to know the good and bad of having a credit card. Yes, it can make life very easy, however, it can also place a large strain on the spender. Misusing it can leave the user with poor credit, debt, and fees.
Knowing the good and bad of using it is the best way to ensure you’re taking full advantage of your credit card.
Pros of Credit Cards
Understanding the pros of using a credit card will help you know how to take full advantage of it. Below are some of the pros.
Access To Finances
Most people have experienced that mid-month drought where you have no money left in your expense account. This can be stressful especially if you need money urgently. As the name suggests, a credit card allows you to spend money on credit then repay it at the end of the month. Therefore, you can shop for household items even when you don’t have money in your account.
Building Credit
You can build your credit when you use a credit card properly. You generally need to use credit when you want to build credit. When you’ve got good credit, some of the benefits available include better rates on the cards, auto loans, and mortgages, among several other things.
Earning Rewards
You can earn rewards like points and cashback when you use a credit card. Most of the popular banks out there also provide their customers with sign-up bonuses and features that can give them many points when they meet certain spending requirements.

Fraud Protection
In most scenarios, credit card service providers have safeguard protocols that help protect their customers from credit card fraud. Whenever you notice you have charges or fees that you don’t recognize, contact the company that gave you the card and find out what’s going on. If you don’t have access to your card, or you just can’t find it, make sure you report it either stolen or lost as soon as you can. 12 Red Flags You Should Look Out For To Avoid Being Conned
Cons of Credit Cards
Just like how you need to understand the good that comes with having a credit card, you also need to what makes them bad.
Potential to overspend
It can sometimes make you feel like you have an infinite source of money. Furthermore, you can get yourself into serious debt if you use it that way. So if you’re considering getting one, make sure you’re keeping tabs on how you use it. Try not to overspend just because you know you have easy access to money.
You Can Fall into Serious Debt
Most people don’t want to be “in debt” and a very common way most people get into debt is by overspending on their cards. If you don’t want to get into debt this way, come up with a budget and check how you’re spending your money as often as you can. Monitoring how you use your money can help you know where and how you’re spending. Tips On How To Stop Being A Spendthrift
Interest and Fees
You can end up carrying a balance when you overspend on your credit card. This can lead to you being charged extra interest on that carried forward balance. Interest rates can sometimes grow so big it overwhelms the spender. Beyond interest rates, most banks have charges for things like cash advances, balance transfers, and late payments.
Like many things in life, using a credit card has its advantages and disadvantages. If you are clever about when and how you use it, it can be an incredibly useful and essential financial tool. Hopefully, this article has helped show you why.
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