Conventional wisdom dictates that credit cards are the devil. Anyone that watches TV will see the adverts which categorically state they are the offspring of Satan. So, I’ve handled them with kid gloves for all these years. Wherever possible, I’ve avoided them like the plague, and I’ve done it for the greater good. Damn, I wish I bought those shoes! The thing is I’ve only found out that credit cards aren’t all bad. In fact, they might be helpful, and here’s why.
Credit Score Boost
Most of us like to think we have an immaculate credit rating, but we’d be wrong. The majority of us know why (damn I never wish I bought those shoes!), yet the reason would catch a lot of us by surprise. As it turns out, a lack of a credit card harms our score. The reasoning is simple: banks have no info to tell whether we are good money managers. A card statement tells them everything they need to know, which is why a piece of plastic is vital. Without one, lots of us could go to the bank and get rejected for a mortgage, for example. That would be a massive kick in the teeth.
Card companies always have incentives to lure in new customers. Even though they are manipulative, they are also beneficial. 0% APR on purchases, for instance, is an ideal way for us to manage our cash flow. Sure, we will have to pay the company back at some point. But, there is no need to rush when the offer lasts for 12 to 18 months. The clever spenders among us can use a card in budgetary times of strife, and pay it off further down the line. If you’re like me, cash flow won’t always be your greatest strength!
There are times when we are all out in the world and need to make a purchase but don’t have any money. Even worse, we don’t know how much is on our debit cards. The laziest readers will notice how much of a problem this is causes. It means either walking to an ATM or not buying the product, full stop. These alternatives are arbitrary with a credit card. Most of us know how much we have on credit because we’re scared of going over the limit. Plus, the card is always there, ready to hand to the cashier. It might seem insignificant, but it prevents using additional cash and fines.
Worst Case Isn’t Terrible
The first thing that we should all note is that debt is a problem. Still, I don’t think that it’s as significant as people like to think. Yes, it can lead to insolvency or bankruptcy, and we can lose everything. However, this scenario only occurs when we don’t get some help in our time of need. The worst case scenarios happen because ordinary people bury their head in the sand. As long as we address the issue, we can limit our losses before they escalate.
Anyway, now that you have this post, there is no need to go through the experience.