Disadvantages Of Not Owning A Credit Card
Posted on 24. Nov, 2011 by admin in Finance
Credit cards have become a part of our lives. We use them when we go shopping so we don’t have to carry large amounts of cash. We use them to rent or reserve things. They are a convenient way to pay for merchandise online as well as in the stores. There are several advantages to having a credit card; and there are some disadvantages too. In our society today, there are very few people who do not have one, but there are still some who do not understand how a card could benefit their lives.
One of these benefits is the fact that they are safer to carry and use than cash. Some places will want a credit card instead of cash; some of these places are car rental services and hotels. Those who do not have a credit card may have a harder time renting a vehicle or reserving a room in advance. So you are at a disadvantage if you do not own a credit card, and if you plan on renting a vehicle in the future or staying in a hotel.
They help build up your credit history; and this is very important to have a good credit rating. But you do have to be sure that you make timely payments. Just like any other debt, the money has to be paid back on time. And if you pay your card off each month, you can keep from having to pay extra on interest. When you choose a card, it is best to compare credit cards to see which ones offer the best pay back plans as well as cards with no annual fees. Some interest rates are higher and are charged sooner to your account than others. By comparing the facts on the cards, you can choose the best one for your needs.
They are wonderful to have if you see something on sale that you need or want; but do not have the extra cash to spend on it. You can go ahead and purchase the item and save on the cost; and then pay it back within the grace period before any interest is charged. By using your credit card, you have buying power when you have no cash.
Some cards will offer you rewards for using them such as points to purchase more items. Some will even give you free airline miles for when you travel. When you compare credit cards, you will be able to see what rewards are offered by each card. And some cards will offer you protection when you make a purchase. For instance, if you buy an item and charge it to your card and that item is lost or damaged, the card company can prove that you purchased it even if you have lost your receipt. Also, some companies will offer extra insurance on larger purchases. These benefits protect you when you make purchases.
Another benefit or advantage to owning credit cards is that they are a great source for emergencies. We never know when we will need extra funds fast to cover some unexpected expense. Car repairs or sickness can happen when we least expect it, and we sometimes find ourselves unprepared to handle the expense. Some cards offer the opportunity to get cash advances to use for whatever you need. This is one big advantage if you have an emergency and no cash available.
There are so many advantages of having a credit card. But there are some things to remember when you own a card. One is not to abuse the card. This means don’t overcharge. If you go over your limits, you will incur extra charges. Be disciplined when shopping and charging, as well as in making your payments. If you shop and spend responsibly, you will have your card when you need it the most; in emergencies and when traveling. Some companies like the airlines and rental places will not accept cash, and you will need that card.
Owning a credit card is a necessity in our society today. Just be sure to choose the card wisely to meet all your needs, and then you will have cash when it is needed.