What Are The Dangers Of Credit Cards
Friday, September 11, 2020, 6:00 AM | Leave Comment
Credit cards have become as much of a daily part of life as phones and computers.
We use them for everything from coffees in the morning, to paying off debt.
They can seem like a miracle cure when payday is too far away, or you want something that’s a little out of your price range.
Unfortunately, this miracle doesn’t come without a cost. Credit cards are rife with danger and can put you at risk for losing everything that you’ve worked hard to gain.
Here are their dangers.
-
Ruining Your Credit Score
Your credit score is something that shouldn’t be taken lightly. Like every other problem on this list, your credit score is at risk if you don’t pay on time, or fail to pay at all. Your credit score is a factor that can decide anything from cars, houses, and even what college you can go to depending on loans. Credit cards take your score down a couple of notches just from the application and can tank it further.
-
Losing More Money Than You Spend
If you don’t pay before payments are due, you’ll owe interest. This problem can mean paying 2-16% higher than the item was worth. This amount can seem negligible for purchases like dinner or a movie, but if you pay rent with a credit card, you could be looking at paying over by a lot when interest kicks in.
-
Spending Unmonitored
Credit cards may feel like fake money to people. This problem doesn’t mean that it’ll feel that way once payments are due. With a digital money source, it’s more natural to wave it off as unnecessary to track and simple to ignore how much you’re spending. People get into credit card debt because they stop watching how much they spend or get an addiction to buying things when they can’t afford to pay them off.
-
Eventual Purchases You Won’t Be Able to Make
In the line of ruining your credit score, you could ruin your chances at the American dream. To buy a car on credit, you need to have a score of at least 630+. If you don’t, you could be looking at higher interest rates, or getting denied altogether. This issue goes with home buying as well, which could leave you renting an apartment and taking Uber to work for the rest of your life. Say goodbye to looking at Calgary homes for sale; you’ll have better luck trying to save for the next ten years to afford a small duplex home.
-
Confusing Terms and Conditions
Credit card companies use a lot of fine print to confuse consumers into making a mistake. If you don’t make a payment on time or send it in the wrong way, it could take away whatever deposit you put on a card. This trouble could both kill your credit score and put you out a couple of hundred dollars. If you’re not sure about this purchase, don’t do it. The best thing you can do with a credit card is to get one to rebuild your credit score, leave it in a drawer, cut it up, and not make any purchases on it.
