Over-spending? DebtBusters provides you with the warning signs to look out for… We all go through periods of over-spending. No matter how well we budget, some expenditure just cannot be planned for. However over the long term, things should go back to normal. If this is not the case, then you should be worrying. So […]
2 December 2012
Is it a good idea to get a credit card? How will it benefit me? How will it affect me?
Using a credit card places you in a unique position. The goods are paid for and ownership is gained but you do not have to pay back in full and no interest is charged for several weeks.
The key to using a credit card is to make full payment by the due date. A consumer should only spend daily on the credit card to what they will be able to afford to pay back at the end of the month. The balance should be kept for emergencies. Credit cards eliminate the need to carry cash and can be used all around the world 24 hours a day without incurring transaction charges.
A credit card expresses the account holder’s credit worthiness as issuing banks regularly review your disposable income and your credit history.
Credit cards do come with risks attached and you should not take the decision to obtain a credit card lightly. Bank charges and interest form part of the agreement and can get you into financial trouble if not handled correctly.
A consumer should shop around to see which bank offers them a better interest rate. They are able to shop around on line to see which bank would be the best for them. And if any rewards are offered on purchases made via a credit card.
Consumers must take note that there is high interest on short-term debt and credit cards make it easier to spend even when they do not have the money.
So used correctly a credit card can benefit you hugely.
For further information on credit related matters please contact DebtBusters on 0869 99 06 06 or have a look at our website www.debtbusters.co.za.