What are the advantages and disadvantages of credit cards?

Credit cards do help build your credit score rather quickly, which is an advantage when it comes to things like loans for a house or leasing/financing a vehicle. A higher credit score allows you a lower interest rates on your monthly payments on such things. As long as you remember to pay your credit card bill every month then you should be in good shape. What I do, is use my debit card as a credit card, the advantage of this is that instead of a bill every month, the money comes out of your checking acct. right away and you wont miss any bill payments, plus it does build your credit score. Disadvantage- you sometimes forget, lose track, or go overboard and rack up thousands of dollars in debt. It all depends on the person who is in possession of the card.

Well here’s the thing. It builds your credit and as long as you pay stuff back immediately, you’re not paying too much interest. You also need it for things like renting cars and hotel rooms. Life can get a little complicated without one. Most debit cards have limits on them (so how much you can pay out in a single day). If you’re trying to spend more than 5,000 in a day, you have to write a check. They’re not essential, but you do end up in weird situations if you dont have one. For example because I’m under 25 I cant rent a car without a credit card in certain places. It is inconvenient to say the least.

Actually, I work with a bank and the more your pay bills with interest the faster it builds your credit. It builds your credit faster to split your bill in 2 to 3 months and pay it out within that time, so you pay interest. Some people choose not to simply because they don’t need a high credit score ASAP. For those who need one, splitting your bill into separate months is the best course.

I know. I didnt say anything that contradicted that. I know you build credit faster if you pay back stuff over a little time. I just choose not to because I dont like paying interest on credit cards. Although that has landed me with a crazy interest on my car payments.

Yeah, you’re right. I started building my credit ASAP. Hoping to finance a car by the middle of next year, so I spend like 200 every 3 months on a credit card separate from my checking account. It helps, my brother did that.

It is easier to carry plastic money especially when on vacation. I personally don’t own a credit card as my bad experience of running into heavy debts nearly made me a bankrupt. I swipe my credit cards on my shopping spree and at the end of the day my bank saving account turns red. The disadvantage is we are tempted to purchase anything and everything

I agree, when I moved back to NY after not living there for 15 years i had 0 credit…so the best way I built mine was writing out checks for my rent…and shopping i had to split 500 dollars on my c.card then another 2500 in payment plan for my couches. That helped me bcz i was able to purchase on the spot & get it in 3 days while paying it out for a longer period of time…the interest rate was not really a problem though i did wind up wasting a lot of money on it. To say the least it helped build my credit & that is what i was working on. Same with my tv…I had to do the same…and the more i spent on my c.card the faster the limit on my c.card grew as well! By the time I was done, i was also getting my teeth done on another plan…with 3 major bills…I was able to build my credit history also paying in full and on time helped me increase both my credit line, credit history & perhaps my fico score!

There are ups & downs to a credit card, if you arent careful you can & will go over board…the worst part is when u wind up like my ex - husband…had no credit after the divorce…:P He had to start from the beginning with no place to live…barely able to make the minimum payments…and who knows what else…(haha frankly he deserved all he got after screwing me over with the business anyways) Try to never do that…nev pay just the minimum 15 dollars bcz that is what screws people over buried in debt! charge less, eat less, but pay in full so you know you can sleep better at night debt free!

Credit can be very useful when used responsibly.

The way to be financially secure is to live beneath your means and spend less than you make.

The way to get in financial trouble is to live above your means and spend more than you make.

Credit certainly makes it easier to do the later but it doesn’t keep you from doing the former.

Try to never charge more than you can pay off next statement and if you overspend make paying the bill down your number one priority until is is paid off.

Unfortunately Debit cards do not build credit. Starting out, a credit card can increase your score considerably. Generally younger individuals want to build credit so they can get a student loan, or a vehicle for college. But some of the disadvantages are that too many cards, or excessive balance transfers, close the the limit cards, and minimum payments can also reflect negatively on your score. The best solution is to have a card with a limit if $500.00 and make your monthly purchases on that. What I do rather then using the debit card. i use the credit card to earn the cash back points and also showing activity on the card, but then i subtract it from my check book register to make sure at the end of the month the entire things gets paid off. Most card as long as they are paid withing 20 days of the statement date, not the day you receive it, but when it was issued then you do not pay any interest plus you received the cash back bonuses from the card. :-) Good luck with the Credit Card!