WHY YOU SHOULD HAVE A CREDIT CARD

WHY YOU SHOULD HAVE A CREDIT CARD

Credit cards are cards with revolving credit(an arrangement in which you can buy something with a commitment to pay the debt later). Credit cards always come with a spending limit per month after which you will not be able to use the card for purchasing until and unless you pay the minimum amount due. The card issuer sends you a bill every month which is to be paid within 45 to 55 days(varies from bank to bank), after which an interest rate and late payments charges will be added to the bill.

 

Here are a few reasons how having a credit card can make your life easier:

 

  1. Convenience: Having a credit card gives you a peace of mind even when you are not carrying enough cash with you. If you are in a situation when you want to buy something but the cash you have is not enough for that,you can use your credit card to pay for the purchase.
  2. Tracking your expenses: If you are a person who cannot usually keep track of where you spent your money, it is a good idea to use your credit card to make purchases. You can keep track of all your purchases, which will help you in making monthly budgets properly.
  3. Instant cash: When you are in urgent need of cash, you can use your credit card to withdraw money just like your ATM or debit cards. It is a quick and a convenient way to get cash whenever required.
  4. Improves credit score: Having a good credit score is very beneficial and a credit card helps you in improving it if you make the full payments of your credit cards bill in time. Having a good credit score ensures getting a good insurance policies and loans easily and also the rate of interest you will have to pay in mortgages loan, personal loans or any other type of loan will be less than the interest rates paid by people with bad credit scores.
  5. Online purchases: There are a few shopping websites that do not have the option to pay via cash on delivery or other payment gateways like PayPal or PayTM, so you either pay for your shopping using a debit card or a credit card. For online purchasing, a credit card can be a good option if you do not have enough balance in your bank account.
  6. Credit history: For people with no credit history, they can establish a credit history with the help of their credit cards. Having a credit history is beneficial for your future if you ever need to take a loan because banks and other financial institutions prefer people with good credit history.
  7. Purchase protection: When you buy something with cash and the product turns out to be defective, it is your sole responsibility to get your money bank or exchange the item which can prove to be a waste of both your time and money. But if you buy a product with your credit card and it is defective, the bank takes the responsibility to replace it with a proper item, or in some cases also refunds your money of the bank finds you in favor.
  8. Emergency money: We usually carry that much cash only which we think will be enough for our daily needs. But if an emergency arises where you require more money than you currently have, a credit card  can be very helpful.
  9. Rewards: Most of the credit cards offer incentives like cashback, loyalty points, reward points on your credit cards if you use your credit card properly and pay the bills of your credit card in time. They also offer discounts on various types of purchases.
  10. No fear of loss of the card: When you lose your cash, it seems impossible to get it back, whereas if you lose your credit card, all you have to do is inform the card issuer about the loss of your credit card and get it blocked so that if any third party finds your card, they are not able to use it. After blocking of the card, you will get a new card.
  11. EMI purchases: If you want to buy something very costly and you will not be able to pay the complete money in one go, you can repay the money in EMIs.
  12. Resolving credit: It is not mandatory for you to pay the complete amount of your credit card bill in one go. You can pay the minimum amount due and postpone the payment of the balance amount for the next months.
  13. Lost card liability: If you lose your card, you will have to inform the card issuer about it so that they can block it. Also the banks will not hold you responsible for any purchase on your credit card after you report it stolen.
  14. Automatic currency conversion: When travelling out of your country, you do not have to worry about how much converted cash do you have. When you have a credit card, all you have to do is swipe your card and the amount will automatically be converted to the currency of the country where you made the purchase.
  15. Fast payment: Using a credit card makes payments faster as you don’t have to keep looking for a exact change in your wallet. Just swipe your card and get done with the payments.

Though using credit cards can be very easy but it is also important that you make the payments within the grace periods so that you don’t have to pay anything extra on your credit cards like late payment charges or additional interest rates.

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