Credit Card

Perks And Drawbacks Of Using Credit Card

Consumers nowadays have many payment options to choose from. If before, you can only pay via cash, checks or bank transfers, now you can use your debit card, credit card, gift cards, and electronic payments, to name a few. While debit cards are a crowd favourite, credit cards reign second place and are the number one payment alternative next to debit.

Credit Cards enables you to borrow funds which you can then use to pay for goods and services. Some credit cards even allow you to make cash advances. However, every transaction comes with fees.

GetMyOffer Credit Cards

You may have come across many credit card offers in the past – some from your bank, other financial institutions and maybe even one from GetMyOffer. Capital One is the bank that offers GetMyOffer credit cards. They cater to their goods and services in the US, UK and Canada to consumers, small businesses and large corporations.

The general requirements for credit cards are your personal information like your full name, date of birth, physical address and social security number. You may not be a fan of credit cards, but it pays to learn the different pros and cons of using and having one.

Good Read: What’s a Credit Card Cash Advance?

Perks Of Using GetMyOffer Credit Cards

Faster And Easier To Use

Compared to other modes of payment, credit cards are the fastest and easiest way to pay for goods and services. With credit cards, one only needs to swipe your card, and the deal is done in seconds.

Instalment Payments

The best reason why many love using credit cards when buying goods or services is that you get to pay via monthly instalment. You won’t need to pay for the price in full before you can get what you need. There is a minimum amount due every month in which you can opt to pay when you can’t pay your debt in full just yet.

More Purchasing Power

For the most part, cash and other modes of payment only allow you to make transactions in-person. For credit cards, you can make online transactions, over the phone, or in person. Some are even accepted worldwide, giving you purchasing power like no other.

Emergency Funding

When you have unexpected expenses, you can always use your credit card even if you don’t have the money to cover for it upfront. This is the fastest and easiest debit money you can get since you no longer need to apply for a loan if you’re already a cardholder.

Earn Rewards

Financial Institutions offers rewards to their credit card users in exchange for their usage and support. To keep them happy and compensated, they came up with rewards systems that give credit card users rewards as long as they meet the criteria set. The more you use your card, the better your chances of gaining rewards points. In return, you can convert the rewards for cash, miles, gift cards, and the like.

Credit Boost

Credit card users pay their credit card bills every month. When you’re able to make on-time payments, makes use of your credit card wisely and keeps your balance low, you get to boost your credit score. Having a good credit history and build your FICO score enables you to qualify for better terms and interest rates for car loans and mortgage.

Recommended Read: 7 ways to improve your credit score

Zero Interest Rate

Many credit card options that enable their users to enjoy an introductory 0% interest for at least six months. It means you have six months to pay off your balance minus the interest fee.

Cash-Free Transactions

When purchasing anything with credit cards, you don’t need to bring any cash with you. This takes the hassle of having to carry some money or withdraw money from ATMs to buy what you want.

Protection Against Fraud

Credit cards are often more secure than your debit account. By reporting fraudulent transactions immediately, your card issuer can clear the transaction, leaving you to pay a minimal amount instead of having to pay in full.

Potential Drawbacks Of Using GetMyOffer Credit Cards

Credit cards are convenient, but every usage comes with fees and interest. When you don’t make use of your card wisely, you can end up having expensive credit card fees which can add up to your total bill within a year. You won’t need to pay for interest fees for every transaction but comes with charges if you miss a payment. Also, this does not include any other fees stated on your credit card agreement.

Temptation To Spend Money You Can’t Afford

Just because a financial institution approved your credit card application already meant that you could afford to pay them back quickly. Unlike major debts such as mortgage loans, your credit card provider will only ask you to provide financial information including your gross annual income. It only means that credit cards can tempt you into spending more than what you can afford to pay. It can then lead to more debts under your name if you fail to make timely payments.

Can Potentially Grow Your Debt

Since credit cards enable you to acquire goods and services without paying for it at the time of purchase, this can potentially grow your debt quickly. Every time you make any credit card transaction, you’re creating debt. By only paying the monthly minimum amount due, you’re risking yourself of gaining more debt and maxing out your card which can take a toll on your finances in the future.

Ruin Your Credit

When you fail to make payments on time, only paid the minimum amount and ran up big credit balances, this can destroy your credit score. Your credit score tells lenders how good or bad of a debt payer are you. The lower your score, the lower your chances of landing future credit loan deals.

Potential For Fraud

They may have federal protections against fraud, but that doesn’t mean fraud is non-existent in credit cards. When thieves get a hold of your details, they can use this to make fraudulent transactions. Thankfully, you can counter this by reporting such transaction right away.

All credit cards have their perks and cons. With wise usage, you can get the most of your credit card and avoid any financial hassles in the future.

Author Bio:

Arnel is a content strategist and a financialblogger at papergrower. He spends his free time reading articles about money saving tips and marketing.

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