kdn042417-blog

[kdn042417-blog]

Credit cards have become a necessity for a person in the day and time we live in. The prices of everything in society has risen exponentially and the easiest way to pay for things is to charge it to a credit card and pay for it over time. This will quickly put you in a predicament you do not want to be in, debt. The tricky part of credit cards is interest. Interest builds on the amount that you owe over time and makes you pay more for the product in the end. However, a person needs good credit to apply for loans needed throughout their lifetime such as for houses, cars, or boats. Credit cards are a good way to build credit if used properly.

Credit cards are very good to help people to pay for things that are difficult to afford in one-time payments like furniture or vacations. For those in college, its good for things like gas, food, or books. Credit cards are also a good start to learning how to pay bills and being responsible with money. This quote from life hacker shows a pro about credit cards, “Can be used to build up credit score to help with borrowing—your payment history is the most important component of your FICO score (it accounts for 35%), but the length of your credit history (i.e. how long you’ve had a card) is also considered. This can save you thousands of dollars in lower interest rates when you’re borrowing for a house or car over the course of your life.” If a credit card is used properly, it can really build credit because they can see that you are responsible with your money.

Credit cards can also become your worst nightmare if not paid accordingly. It gives a false idea on how much money a person really has and can spend. Just because you have the room on the credit card to spend more money does not mean you should. It is very easy to walk into a mall and go on a thousand-dollar shopping spree. However, can that person really pay that off before interest kicks in and makes them pay more than what it’s worth. Many people either pay the minimum amount due and that allows interest to build up, or they can’t make the payment because they overspent what their bank account holds for that month. This quote from life hacker proves a con about credit cards, “Easy to fall into debt if you overspend: The average household with credit card debt has balances of $16,883, according to NerdWallet.” While credit cards can build your credit, not being used properly will destroy your credit.

 Works Cited

Adamczyk, Alicia. “The Pros and Cons of Credit vs. Debit Cards.” Two Cents, Two Cents, 12 Dec. 2017, twocents.lifehacker.com/pros-and-cons-of-using-debit-vs-credit-cards-1821128501.