The Pros and Cons of Having a Credit Card

Credit cards in a row falling - credit card debt concept

A credit card is becoming more of a necessity these days. Paying off bills and all kinds of purchases has been made more convenient with the swipe of a card. Almost every establishment accepts credit cards, while some actually prefer it. Needless to say, however, unwise and improper use of credit cards can land someone in very deep debt. However, wise and proper use of credit cards can truly make a plastic work to one’s benefit.


  • FLEXIBLE/ADAPTABLE. Today, you can use your credit cards anytime and anywhere. In making purchases online, which is becoming more common today, a credit card is indispensable – yet it is wise to compare cards in order to find the best rates.
  • EMERGENCY PURCHASES. With a credit card, you have a stand-by fund in case you are short on cash. Your easily accessible credit line will be useful in case of medical emergencies, car trouble, and even short periods of unemployment.
  • INSTALLMENT PAYMENTS. With credit cards, you can purchase items on an installment basis. Often times credit cards allow you to purchase items at 0% interest for a certain period, i.e. 6 months.
  • REWARDS. Using your credit cards can let you avail of various offers and deals. You can get discounts, free items, and even airline miles for transacting with them. You can even get cashback when using your credit card or applying for a new card.
  • BUILD GOOD CREDIT. Using credit cards allows you to build your credit history. Additionally, with prompt payments, you will be able to raise your credit score.


  • INTEREST AND PENALTIES. Unless you avail of 0% offers, credit card purchases incur interest which range from 10-20% of the purchase price. Additionally, if you fail to pay at least the minimum amount due, as indicated in the statement, you will be charged a 30% penalty, on top of the interest charges.
  • Impulse buying. Having a credit card around will make you think that the credit you have been granted is like cash you have in your pocket. It will tempt you to purchase items on impulse. You will not think twice about buying an item because it merely takes a swipe of the plastic at the counter. Thus, you end up spending more money than you can afford.
  • ONLY MINIMUM PAYMENTS. Making only minimum payments and continuing to use your credit card will let you sink into deep credit card debt as the remaining balance revolves and grows monthly with the accumulated interest charges.
  • RISK OF FRAUD. It is not unlikely that someone will get hold of your credit card or credit card information and use it to make purchases under your name.
  • BAD FOR CREDIT. Having several credit cards, especially when they have large unpaid balances is disfavored by lenders and can be ruinous to your credit score.

Based on the list above, it can simply be said that your intelligent and responsible use of a credit card will ensure that you reap more of the pros and less of the cons in credit card ownership.