The Advantages and Disadvantages
of Using Credit Cards
If you use a credit card wisely, then it is entirely possible for you to borrow wisely at no cost. You’ll have the advantage of extra protection for all your purchases and even earn cash or rewards if you spend using your card. Below are some of the companies in which you have a great advantage in Credit Card Reader in the market: Shopify
The advantages of using credit cards
If you want to purchase expensive stuff all at once, then it’s ideal to use a credit card. You can use a zero percent credit card to pay for your stuff and then divide the cost into several months by making several payments for clearing the balance. As long as you pay the remaining amount of money before the interest period is over, then your credit card won’t get charged. But if you fail to pay the money before the stipulated time, you will have to pay the penalty in the form of interest every month on the remaining balance.
If you pay using a credit card, you get protection as compared to when you pay using debit cards, cheque or cash under the section 75 of the consumer credit act. If you buy an item that costs between 100$-30,000$ your money will be refunded to you in case, there’s a problem.
In case your purchase is faulty, or it isn’t delivered you won’t lose your money because you will be in a position to claim your money back from your credit card provider. Your money and information will also be protected in case your credit card is used for fraud by fraudsters. Ensure that you don’t write down your pin number anywhere as fraudsters might use it.
• Switching your balance
If you owe a certain balance on store cards or credit cards, you can opt to have a new card. If you change your card, you will be paying interest rates of zero percent to your balance credit card. You will also be needed to pay a transfer fee of 3% which is lower than if you decide to stay with your previous card which will be charged high interest.
Make sure you finish paying your debt before the 0% period is over to avoid being charged with interest on the debts you will be having.
Disadvantages of using credit cards
• Hidden costs
The interest rate isn’t the only cost that you will get with the credit card. If you miss a particular payment or are late in making your monthly payments, you will have to pay extra costs. If you exceed your credit card limit, you will be required to pay the penalty. So make sure you have control of how you are spending money and also don’t be late in making your payments.
Don’t make a habit of withdrawing money from your credit card. A lot of firms charge a specific fee for withdrawing money. You will also begin to build up interest as there is no free interest period on cash withdrawals.
• Picking the right card
Ensure that you select the appropriate card or you end up paying more than you want. If you have expensive projects coming up, you should probably choose a 0% purchase card to use.
Credit cards can be of benefit to you if they are used wisely and also can incur you debts and high interesting if they are handled carelessly. Always choose the right credit card for you that will suit your needs.