While swiping a card through the machine and taking your shopping bag home with you sounds very easy, the truth is that each of those swipes is just the same as taking out a bill out of your wallet. There are, though, many advantages a credit card can offer, but some obvious and hidden advantages exist. Credit cards can bring you some perks, like extra protection, security, borrowing for nothing and sometimes even special points which can bring cashbask when using your cards. The downsides of using credit cards unwisely can bring ever climbing interest rates and a debt that seems like a mud pit.
Credit cards are definitely a very quick way to get hold of some extra money you might need. If you need quick cash to purchase something, pay for something you did not expect you needed to, to cover certain urgent costs – you can always use a credit card and pay off the whole amount in pieces afterwards. It is very useful to cover expenses such as the ones mentioned and then spread the whole sum over a period of time.
Also, credit cards from major companies are accepterd all over the world and they are a very practical, easy and safe way to purchase on-line.
Credit cards are also a bit safer in terms of customer protection when compared to cheques, debit cards or cash. There is a level of security which allows the card owner to return the payed amount if something goes wrong. Also, additional protection exists in case of fraudulent use of your card because the card provider is obliged to refund the money. But, this does not apply in cases of negligence.
Certain credit cards allow you to borrow money for free, without charging interest rates. This means that you can enjoy an interest-free loan. You do have to be careful of the time periods in which offers like these stand, because if you do not clear your balance until the offer expires, you will be charged interest. Since average interest rates for many credit cards are usually around the 18% number, you will want to take advantage of offers like these. Some credit card companies go so far to offer different privileges as incentives to spend more – loyalty points, cashback and air miles, for example. The main condition is that you have to pay your bill in full.
Track Your Spendings
Credit cards are a good way to keep track of your spending. At every end of month, you will receive your balance sheet in which all of your payments will be presented to you. This way, you will be able to have an accurate, precise listing of each payment you made in the last month and, this way, you will be able to plan ahead much more carefully. You will have full insight into your spending and will be able to control your costs better than with cash, which can be very „slippery“ and find very easy ways to escape your wallet.