Despite all the fears of being caught in a debt trap, credit cards are actually really helpful — that is, if you promptly pay your bills in full AND you only use your credit card like you are using your available cash. In fact, credit cards are worth having as long as you know how to manage them well and how to control your spending.
Below are a few reasons why credit cards are actually advantageous to you:
Who doesn’t want to experience convenient, cashless transactions when shopping?
Using credit cards can help you save so much time and trouble. For one thing, you do not need to bring a huge amount of cash in your bag and risk getting robbed of your hard-earned money. So basically, using a credit card is a lot safer than carrying cash.
Also, you would not need to find a bank or an ATM to withdraw money when you need to pay for something. All you need to do is to have your card swiped. Just make sure to have it swiped wisely.
Free Short-Term Loan
If you pay your bills in full and always on time, credit cards are like a free short-term loan. This means you do not need to pay any interest or fee as long as you pay in full on or before your due date.
It’s like borrowing money for a month or less from a friend, without interest. Additionally, most banks would gladly waive your annual fees, especially if you are a regular user and a good payer.
Rewards and Perks
Most banks offer reward points system every time you use your credit card. You can then convert your earned points to whatever rewards available. This is more advantageous if you use your credit card for your regular expenses (such as groceries, school fees, medication) instead of cash. You will earn a gift for using a short-term loan on your purchases!
Moreover, some credit card companies offer perks for their cardholders, like special discounts and freebies when they use their credit cards at certain establishments. You just have to be familiar and stay updated on your bank’s promotions.
Are you planning to buy a home appliance or furniture but do not want to spend a large amount of cash at once? Most establishments nowadays offer a zero-interest installment package for credit card holders. You can enjoy an interest-free loan for your purchases for 3, 6, 12, or even up to 24 months!
Credit cards are undoubtedly proven helpful in times of emergency when you really need to pay for something very important (like hospital bills, therapy, and medication) but do not have an immediate cash on hand. However, we still strongly suggest that you build your own emergency fund to prevent getting into debt in case something unexpected happens.
Still afraid of debt?
There is a certain risk of spending beyond your means, especially when you can conveniently swipe your cards almost anywhere without actually seeing the actual outflow of our cash. And for this reason, we know a lot of people who have (irrational) fear of using credit cards. But the truth is, it is not the credit cards you should be afraid of – it is your spending habits you have to control and your own expenses you should manage.
Once you learn to use your credit cards as if you are using your available cash on hand, you will get to enjoy all the underlying benefits of being credit card holders like those mentioned above, and more.
Credit cards are not the enemy – in fact, a credit card can be your friend which you could count on when you need it. The true enemy lies within you — all you need is a little discipline and learn how to take control.