Why Credit Cards Can Be Good For You
With society marching relentlessly towards a cashless society, credit cards have become an endemic part of us. As a result, the issue is not whether to avoid credit cards altogether but rather to find a way of using them smartly in order to obtain the most use out of them. There are a wide variety of cards - student, business prepaid, - available that, any consumer can select one which is most suitable according to his or her circumstance.
Pre-paid credit cards are similar to debit cards except that they do not come with a bank account, gas cards are usually used most times for the purchase of gas. Discover offer very competitive gas card rates. Secured credit cards are most sutiable for people who want credit cards but have poor credit or no credit rating. A deposit is usually required up front as a guarantee in the event of non-payment. Usually background checks are made, but due to the competitive nature of the market, most providers offer guaranteed approval without credit checks. Student credit cards are designed specially for college students. With very competitive rates by different providers, there are many to choose from. It is a great way to build credit history if used correctly.
Some of the major credit card providers are Visa, Discover, Mastercard, American Express, Chase, Advanta and many others. Because there are so many lenders, the sheer dog-eat-dog environment has caused interest rates to fall.
There are many reasons why credit cards can be useful to the normal consumer. With the growing pace of internet shopping, they are probably the best way to acquire goods from online shops. If purchases do not arrive or arrive in an unacceptable condition and the vendor is uncorperative, you can logde a dispute with your credit card provider, who in most cases, will refund the outstanding amount and follow up the vendor on your behalf. This is written into most contracts and should not be overlooked. In fact, it is one of the most useful benefits credit cards offer. Buying using cash or debit card does not offer this guarantee and in most cases the money will be lost. In addition, your credit card being stolen is not as devastating as a debit card or cheque book. In a sense, it is almost an entity on its own whereas a former is tied to your bank accounts and essentially, the very core of your finances.
Another advantage of credit cards is for businesses. Many new business startups have used this as a way to fund their initial business ideas and without it would have found it difficult to survivie in those early stages when most businesses collapse. Loan lenders walk in tightropes when it comes to lending to new businesses. This is not a surprise seeing that about 80 percent of new businesses fail. As such a good business idea can be left prey to venture capitalists who make nearly impossible demands for every penny invested. To avoid this a credit card can be used for the initial expenses and so long as at least the minimum payment requirement is met, the business can grow until such a time as all the debt is paid off. Countless viable business have started this way.
Even for people who have no debt, using a credit card for certain purchases is much smater especially if buying on the internet. Goods and services such as holidays are better acquired using a credit card for reasons already mentioned above. In addition, it is better to have a credit card and pay of the balance every month so as to have some form of credit history than to have no credit rating . This can be a disadvantage for any future need to borrow a mortgage whether for business or for a home. To add to this, those suffering from bad credit score can use them for credit repair and improving credit rating.
To conclude, with the relentless move towards a cashless society, it use of credit cards is unavoidable. The best way is to embrace them and use them wisely to your benefit.
