The many practical uses of credit cards

Dec. 17, 2010 - PRLog -- There are many practical uses of credit cards. The consumer may find that paying with credit is quick, convenient, and can help establish a credit rating. However, credit cards may also be a source of financial burden for many individuals. High interest rates and hefty account fees can be a nightmare, especially if he or she has a high balance on the card. The key to maintaining good credit and avoiding this scenario can be quite simple though. Learning how to properly use credit cards can not only improve one's credit rating but can save the consumer a substantial amount of money.

Advantages of Paying With Credit

Credit can be a safe and secure way to pay for things. Whether the consumer is shopping online or in person, there are benefits to using credit cards. Unlike cash or check books, if the credit card is lost or stolen, the individual may not suffer such a loss. There are laws and regulations in place to protect the consumer in the event that this does occur. Using a debit card offers some advantages but can also be risky, giving that they are linked to personal checking accounts.

When Not To Use Credit Cards

Many individuals fall into debt with credit cards when they are charging more than what they can afford. Although this sounds like a no brainer, it's obviously not. Credit cards should not be used as a regular source of income to pay monthly bills. Another common trap is the habit of purchasing things that the individual could not ordinarily afford without credit. These are often signs of financial problems and/or poor budgeting. If the consumer finds that this is a problem for them, they should set down to re-evaluate their needs and income.

How To Use Credit Properly

Credit cards can be a significant responsibility, that's why using them wisely is so important. Many financial experts will agree that the consumer should charge no more than what they can afford to pay in full, but it may be more complicated than this (http://www.creditcardreview.ca/blog/). Using the majority or all credit available reflects poorly, even if the consumer pays off the bill entirely every month. Instead, he or she should opt to use no more than fifty percent of available credit. Any charges above seventy percent of the available balance can result in a deduction of points from the credit score.

Credit cards are becoming a necessity. It is not uncommon for some industries to require the consumer have a credit card to be eligible for certain services. Establishing credit is necessary for the consumer to purchase a vehicle, home, and to obtain other types of credit. Credit cards aren't the real enemy, only the judgment of the consumer.


For more information on the subject please visit: http://www.creditcardreview.ca/credit-card-articles/

# # #

Canadian credit card directory is listing credit cards offered by major Canadian banks and financial institutions, as well as credit cards offered by Canadian stores.
http://www.creditcardreview.ca