Are you a credit card owner? If you are not, the thought may have crossed your mind. After all, you have likely received numerous credit card offers in the mail or you may have even been presented with credit card offers online. To determine if having a credit card is the best decision for you, you are advised to examine the pros and cons of having one. A few of the most influential pros and cons are outlined below for your convenience.
Perhaps, the biggest pro or plus side to owning a credit card is ease of use. It is no secret that credit cards are easy to use. Many retailers are simplifying the process of paying for purchases with a credit card. What does this mean for you? It means that credit cards are becoming even easier to use. Whether you regularly find yourself in a rush or if you dread holding up the cash register lines, when filling out a check or searching for the correct amount of a change, a credit card may be just what you need.
In keeping with ease of use, you will find another pro to having a credit card. That pro is the ability to shop online. In recent years, the popularity of online shopping has, literally, skyrocketed. Many consumers love having the option of shopping in their pajamas and having their purchases delivered directly to their door. Unfortunately, many online retailers have restrictions, in terms of methods of payment accepted. Unless you are lucky enough to find an online retailer that accepts electronic checks, you will not be able to benefit from online shopping unless you own a credit card.
The perks or benefits you often gain access to is just another one of the many pros to having a credit card. The credit card perks or benefits you receive will all depend on the credit card in question. In fact, that is why it is important for you to choose your credit card carefully. Credit card comparison enables you to choose the credit card that best fits you and your needs. If your cards are played right, that credit card can be one that you can benefit from immensely. It is common for many credit card companies to allow or offer balance transfers, rewards, and so much more.
It is also important to mention the protection that you receive. In the event that your credit card become lost or stolen, you should not find yourself responsible for any illegally made purchases. With that in mind, it is first important to fully review each credit card application you complete. Most credit card companies have rules and restrictions, concerning theft protection. These rules and restrictions may include a liability limit, as well as a time frame in which you must report your credit card lost or stolen.
Although there are a number of pros to owning a credit card, it is also important to examine the cons or downsides to owning one as well. If you have a television, a radio, or internet access, you likely already know how large of a problem credit card debt is. It is something that millions of Americans suffer from. Yes, having a credit card does put you at risk for debt, but this is a risk that you can eliminate. By properly using your credit card and making on time payments, you will not find yourself falling victim to credit card debt. In fact, your credit score may even improve from owning and properly using a credit card!
As outlined above, there are a number of pros to owning a credit card. Of course, the decision as to whether or not you want to own a credit card is your decision to make, but it is important to remember that credit cards can do more good than harm, if used properly.
Monday, March 31, 2008
Friday, March 28, 2008
How Smart Cardholders Shop During the Holidays
When the holiday season arrives, many of us turn to credit cards as a way to plump up our gift-giving budgets. They can be real life-savers when cash is tight. The secret to using credit cards intelligently for holiday purchases is simple: stick to the rules, and don’t overdo it.
Rules? Yes. Before you buy anything, you need to lay down some basic rules for how you will use your credit cards - and be tough enough to stick to those rules.
First, you’ll want to set spending limits. Take a realistic look at your finances. How much can you afford to spend on individual gifts without digging yourself into a hole of debt? Whether it’s $20 or $120, set your limit and stick to it, even if you notice something at the last minute that so-and-so just couldn’t live without! Think of the spending limit you set as a law, not a guideline. This limit will keep you from carrying a large balance on your holiday purchases. (Trust me, you don’t want to be paying off those Christmas presents in July.)
And when you do set your spending limit, be sure to include everything you consider essential for the holiday season. If you regularly send out holiday cards to friends and family, include those. If you’re hosting Christmas dinner this year, include the total price of the meal. Trees, decorations, and small gifts for co-workers and others should all be factored into your holiday budget. You don’t want any last-minute financial surprises; they’re usually bad.
Next, decide where you want to shop. If you have retail store credit cards that offer discounts or rewards, decide whether it’s in your best interest to use those. Don’t wait until the last minute to do your holiday shopping. You’re more likely to make intelligent purchases if you’re not panicking about the date. Also, by doing your shopping year-round, you’re able to take advantage of sales as they come. (Think Fall sales, Back to School sales, Summer sales, etc.) By spacing out your purchases over several months, you will have more time to comparison shop and decrease your chance of charging a lot of last-minute purchases that you can’t pay off quickly.
Finally, pay off your credit card balance as soon as possible. This is a good rule to follow any time of the year, but especially around the holidays. You don’t want those great holiday prices to get inflated by interest and fees. Try to pay off the balance each month. If you have to carry a balance, pay it off as quickly as you can. If you foresee a credit card balance, try shopping with a low-interest card. Also, be realistic. If you’ve gotten into debt that won’t be paid off within a few months, check out some of the balance transfer credit cards. You can get good deals and minimize the amount of money you throw into interest and penalties.
Personal finance experts have a name for the traditional overspending we tend to do this time each year: Holiday Hangover. That brings to mind headaches and nausea, and for good reason; if you’re spending most of your year paying off credit card debt from the previous holiday season, you’re probably sick of it!
Holiday spending doesn’t have to be that stressful. As long as you can honestly assess your financial situation and follow your spending rules, you should have a happy, debt-free holiday season.
Rules? Yes. Before you buy anything, you need to lay down some basic rules for how you will use your credit cards - and be tough enough to stick to those rules.
First, you’ll want to set spending limits. Take a realistic look at your finances. How much can you afford to spend on individual gifts without digging yourself into a hole of debt? Whether it’s $20 or $120, set your limit and stick to it, even if you notice something at the last minute that so-and-so just couldn’t live without! Think of the spending limit you set as a law, not a guideline. This limit will keep you from carrying a large balance on your holiday purchases. (Trust me, you don’t want to be paying off those Christmas presents in July.)
And when you do set your spending limit, be sure to include everything you consider essential for the holiday season. If you regularly send out holiday cards to friends and family, include those. If you’re hosting Christmas dinner this year, include the total price of the meal. Trees, decorations, and small gifts for co-workers and others should all be factored into your holiday budget. You don’t want any last-minute financial surprises; they’re usually bad.
Next, decide where you want to shop. If you have retail store credit cards that offer discounts or rewards, decide whether it’s in your best interest to use those. Don’t wait until the last minute to do your holiday shopping. You’re more likely to make intelligent purchases if you’re not panicking about the date. Also, by doing your shopping year-round, you’re able to take advantage of sales as they come. (Think Fall sales, Back to School sales, Summer sales, etc.) By spacing out your purchases over several months, you will have more time to comparison shop and decrease your chance of charging a lot of last-minute purchases that you can’t pay off quickly.
Finally, pay off your credit card balance as soon as possible. This is a good rule to follow any time of the year, but especially around the holidays. You don’t want those great holiday prices to get inflated by interest and fees. Try to pay off the balance each month. If you have to carry a balance, pay it off as quickly as you can. If you foresee a credit card balance, try shopping with a low-interest card. Also, be realistic. If you’ve gotten into debt that won’t be paid off within a few months, check out some of the balance transfer credit cards. You can get good deals and minimize the amount of money you throw into interest and penalties.
Personal finance experts have a name for the traditional overspending we tend to do this time each year: Holiday Hangover. That brings to mind headaches and nausea, and for good reason; if you’re spending most of your year paying off credit card debt from the previous holiday season, you’re probably sick of it!
Holiday spending doesn’t have to be that stressful. As long as you can honestly assess your financial situation and follow your spending rules, you should have a happy, debt-free holiday season.
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