Does Owning A Credit Card Outweight Not Owning One?
27 Jul
Credit card companies have had bad press in recent years. Experts are claiming that credit cards only cause more trouble to the consumers and impose unfair rates of interest. Certainly, there are some truths about this type of consumer debt, such as people tend to treat the cards as free money and ignoring about the disastrous consequences. However, if used properly, credit cards can be financially beneficial in many respects.
One of the greatest aspects of owning a credit card is that you may improve your credit score. Those with no borrowing experience should take out a credit card to help to convey to major creditors that they are responsible and honest borrowers. By managing your payments well and staying under the credit limit, you are showing that you can pay your debt back reliably. Consequently, your credit score will bound to increase and making it easier to apply for a mortgage or other big loans.
Another advantage of owning a credit card is; it would make your life easier. Some companies, for example, car rental, airlines and hotels prefer credit card payment and some may not accept cash at all. As well as security and convenience, most card companies offer insurance on major purchases. For example, if your flight is delayed you may get a refund if you buy an airline ticket with your credit card. It is somewhat unlikely that you’ll get financial compensation after a delay if you paid in cash, except if your flight is cancelled. Also those who paid in cash are unlikely to get a proof of purchase stored on the electronic database, as all transaction are recorded immediately on the financial statements, so if the purchased items are lost or stolen you can feel more at ease because you have a valid purchase proof stored digitally.
Credit card companies usually stand up for honest customers that are being charged incorrectly. For example, you decided to cancel a purchase with a merchant, however due to a slip-up they ship you the item anyway. When you want to return the item, get your money back, and the merchant refuses to comply, a quick call to the credit card company is usually all that is necessary to settle the situation. Your credit card company can revoke the money as along as it is confirmed that the item is returned at perfect condition.
A more obvious advantage of owning a credit card, and probably the sole reason why even very wealthy people have credit cards, is that you can have immediate access to money when dealing with emergencies. If you are able to resist the urge of using the card excessively, it may even save your life.
All in all you will find many benefits of owning a credit card outweigh of not owning one, provided that you pay off the entire balance each month, although your credit card company may not like it, as interest is one of their primary sources of revenue.
