Ryan P Page, Staff Writer
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Yes, a credit card is a good option for building credit, earning rewards on purchases, and financing big-ticket purchases over time. A credit card is also a good choice for reducing the cost of debt with a balance transfer. However you decide to use a credit card, though, it’s important to be responsible and pay the bill on time every month – preferably in full. Otherwise, you could get yourself into some costly trouble.
Why a Credit Card is a Good Option
- It allows you to pay at your own pace. Affording the full amount of a large purchase in cash isn’t always possible. A credit card, particularly one with a low initial APR gives you the option to buy first and pay over the course of several months.
- It builds your credit history. If you ever need to take out a loan, your credit history will be incredibly important. One of the best ways to build your credit is to use a credit card and pay the bills on time.
- It can save you money through rewards. If you have a credit card with rewards, you can earn a percentage of your money back on purchases. Some cards offer you cash back directly, and others offer points or miles that often can be redeemed for cash back or travel expenses.
- It is convenient to use. A credit card is one payment method that can handle all of your daily purchases, and a lost or stolen card is easily replaceable, making it more convenient and safer than carrying cash. Credit cards also provide excellent fraud protection, with a $0 liability guarantee on unauthorized purchases.
It is important to understand the pros and cons of credit cards before you apply. Improper credit card use can leave you with debt and damage your credit score, which can take a long time to repair. However, with on-time payments, a credit card can provide you with financial freedom and make you appealing to future lenders.
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