Tuesday, August 26, 2014

Advantages and Disadvantages of Credit Card

Advantages and Disadvantages of using Credit Card

Credit Card is an Automatic advanced card which people can use it to get the goods without paying the
cash. Credit cards are widely use by people all around the world as a source of convenient to get what
their needs. But, there are many advantages and disadvantages of using it.

One of the advantages of credit card is that with credit card can eliminate the need to carry large sums
of cash wherever we go. For example, if we are away from home for vocation, we don’t need to take
large amount of cash in pocket. Besides, credit cards may also offer us additional protection if goods
that we bought is lost, damaged, or stolen. This is where the credit card company can know that the
fact that we have made a purchase.While no matter how good you are at math, running your credit card through the machine is always faster than counting out exact change or waiting for the cashier to count out your refund. Credit cards can can also save you time and trouble--no searching for an ATM or keeping cash on-hand. In addition, we can also see that some credit card companies offer insurance for the customers on large purchases. By this way, the companies can protect their customers and give their customers the security of using the card. With a credit card can also assist us build a credit line. By having a good credit history is very vital, which meant that making payments on time and in full month, it help us not only applying a credit card, but also when applying for the loans, rental, or even some jobs will more easily.

In conjunction to that, credit cards can also be useful in times of emergency as well. For example,
students with a credit card can take the necessary actions by helping parents when they falls ill, a car
is damaged, or trying to buy a higher cost books in the university. Some credit cards also offer some
extra benefits for their customers, such as discounts from particular stores or companies, bonuses
such free airline miles or travel discounts. All of these benefits is helpful for us as long as we bear in
mind that out spending limits.

On the other hand, the disadvantage of credit cards is that they encourage people to spend money that
they don’t have. The customers can spend any time as they want even they have less money.
Indirectly, the customers cannot pay for the bill statements that what they had spent. By this way, the
more money the customers owe the credit card companies, and yet they will charge the customers on
interest each month on their spending. The other disadvantages of credit card is that the credit card
companies will charge the customers on high amount of interest on each balance that the customers
don’t pay off at the end of the month. This is how the credit card companies make their money and this
is how many of credit card users will get into big troubles. And, credit card fraud also is one of the
disadvantages. This is where the credit card also same as a cash, it also can be stolen sometimes.
They maybe be physically stolen from customers’ wallet or credit card number and use as to swap the
money. The good news is that, when we realize our credit card is stolen, quickly we can report to the
credit card companies. This is to avoid us by not being charged for any purchases that someone else
has made.

As conclusion, credit cards can make life easier and convenient to the users as they utilize it wisely.
But, if we use it wrongly, it will become huge financial burden for us. If we decide to use the credit
cards, we must know some simple rules such as limit our purchases, don’t spend outside our budget,
pay off the balance at the end of each month, and most importantly is don’t give credit card information
to anyone else as the safety methods.