Pros & Cons of a Credit Card

Having credit cards is a trend nowadays. Credit cards could truly be helpful in times of financial crisis and during emergency situations. They could also provide you with the accessibility and convenience of cashless payments. If used appropriately, credit cards could surely improve your financial condition.

However, there are also several cons in having credit cards. Sometimes, fees may get out of hand due to the high interest rates that most banks charge. Add to the fact that sometimes, there are additional payments that you would have to pay that your are not initially aware of. Credit card could also contribute to your financial disaster, if improperly used.

Applying for a credit should not be an impulsive decision. Do not fill out an application form just because your company or your favorite store endorses it. It should be given careful thought and consideration to your payoff capability and needs. Banks have great marketing strategies that would definitely lure you. 0% APR or low interest rates are good ways in attracting customers. However, it is common knowledge that there are clauses in fine print which make these offers not as good as they initially seem.

People who have rushed their credit card application without understanding all the fees associated with the card will possibly experience difficulties in repaying the debt. Some credit card companies are not as transparent as they should be. That is why you must take extra effort in getting all the facts.

Before applying for a credit card, evaluate your financial capacity first. Most banks offer better deals to borrowers who gave a great credit score so better make sure that your records are set straight. You could always get a free online credit report.

Next would be to do some researches. The internet is a huge library. A few minutes online would give you thousands of results regarding credit card applications. Be sure to understand all the terms and conditions associated with each credit card offer to avoid marketing traps and tricks. Most common tricks are great introductory offers but once the period is over, your interest rates would sky rocket.

You could also consider the rewards and other credit card features. These should be in accordance to your needs. When searching, try to shortlist those credit cards which you would likely benefit from.

The internet also offers fast application and approval of credit cards. You can just visit the website of the banks and they have downloadable forms that you could fill out to complete the application process. Within minutes, you’ll know if your credit card has been approved. This is what they refer to as instant credit cards. You will have instant access to your credit line which you may use online though you would have to wait a few days to get the card in the mail.

Once you have finally decided on what credit card to apply, again review its policies. Remember that as much as a credit card is a privilege, it is also a responsibility. The moment you have affixed your signature on the application form, you have agreed to be liable for all the purchases you will make using the card.

By having a credit card, life’s emergencies would not be a problem anymore. You wouldn’t have to have readily available cash. All you need would be your credit card and you should be able to pay for the car repair or overdue bills immediately. Credit card gives you a certain amount of financial security, but just be wary of you how you use the card. It could also lead to a lot of financial losses.