When Should You Use a Credit Card?

March 31, 2012 by  Filed under: Credit 

Getting a credit card can be a huge advantage to people if they use it responsibly. While there have been many negative statements made by consumer companies about their use, they can help a person out of a rough financial situation when it is needed. It is important for people who use charge cards to use them responsibly and to try at all costs to avoid frivolous spending. This is a trap that millions of people fall into and then they are left with major debt, go into bankruptcy status, or they find that they are unable to get approved for a loan because their credit rating has gone downhill.

There are times when a credit card is an advantage and can be a big assistance. If a parent needs to purchase school supplies or emergency medication for a child and the parent is unable to afford these expenses out of pocket, having a charge card handy can make life easier. If a person is living paycheck to paycheck and missed work for a few days due to being ill, he or she may discover that it has become impossible to purchase a week’s worth of groceries or buy fuel to get back and forth to work on. During times like this, these situations are often referred to as crisis situations and a person can use a card to make it financially until he or she is back on his or her feet.

The less often a credit card is used, the less the person will have to worry about going into debt and finding ways to try to pay off a balance. However, sometimes it is simply necessary to use a credit card in order to survive. Making a payment on a college tuition fee, putting a down payment on a vehicle, paying for an emergency home repair, and financing an operation or other medical emergency are important things that a person can feel justified in using a charge card for.

While many consumer credit companies will warn people against excess use, charge cards also allow people to build up their credit score when they make payments on time. This can be a benefit and can prepare a person financially for taking out a loan in the future for a house or land or other major purchase. Many people would experience severe financial crisis situations if they are unable to afford an emergency expense with the cash they have available. A card can help a person to pay for emergencies when cash is not available and then pay off the balance in drawn out payment schedules over the next several months.

The quicker a person can pay off a credit balance, the more opportunity he or she will be able to save on interest charges. It is important to check with a credit company to see if they give a break on interest fees if the balance is paid off ahead of schedule. Some companies will offer this as an incentive to customers, but not all companies provide this option so card holders should find out this information from the company before agreeing to a contract for a credit card account.

Visit http://www.creditcardrates.com to find the best credit cards for you and some of the lowest credit card rates around.

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