It’s an age-old question, “do I need a credit card”? Well, the real question comes if you ask yourself whether you need another credit card. There are plenty of perceived benefits when it comes to credit cards and not all of them are quite as good as people may think.
Banks and lenders of all kinds make it very clear that their credit cards are simply the best, with highly desirable rates and potential perks too. While this could be ideal for some, you need to weigh up the pros and cons in relation to your unique financial situation.
If you are thinking of adding another credit card onto your existing debt then you should certainly consider whether it’s sensible for you to have another one. We’ve highlighted some important points about credit cards to help you get a different perspective on adding a new one to your collection.
Debt Busters deals with people looking to overcome their debt all the time and we’re always here to help. If you’re struggling with credit card debt at the moment, visit our debt solutions to learn how we can assist you.
I need to improve my credit score
It’s common for people to think that the only way they can raise their credit rating is by spending money on their credit card and paying it back on time. While there is some truth to this, there are actually much easier ways to achieve this.
Start by paying your bills on time. This is the best way to raise your credit score. If you’re hoping to get a mortgage, then you may be surprised to know that paying your rent on time can actually make you much more desirable to lenders.
Yes, getting another credit card will help to do the same thing, but it comes with risks. Missing payments on your credit card will probably severely damage your credit rating and you’ll have to pay huge interest charges. Unfortunately, this is far more likely if you’re handling more than one credit card at a time.
I can’t shop online without a credit card
No, no, no. This simply isn’t true in today’s world. Debit cards enable you to make all kinds of purchases on online and without the risk of spending money that you don’t have. Getting another credit card to simply make purchases online isn’t the best move to make. If you really want something, try to create a budget that can help you save the money needed to buy it.
This is also the same for the car rental myth as you don’t need a credit card to do this either. As long as you have the money in your account, a car rental company will put a hold on your debit card for a specified amount. The only time you should consider using a credit card to make purchases online is for insurance purposes. Even then, it’s definitely not worth getting another one just to do that.
I’ve got to have a credit card for emergencies
You can easily avoid having to apply credit card debt onto your other debts by starting an emergency fund. It’s always a big temptation to resort to credit cards in order to get over a rocky patch but you need to plan ahead if you want to overcome this.
To make sure you’ll stay covered, you should try to save at least $1000 for your emergency fund but always aim higher. While this isn’t enough to cover a big financial pitfall, it will lessen the blow when an emergency hits. Work at it week by week to slowly raise it up and then you’ll always have that rainy-day fund to fall back on.
Whatever you do, be diligent when you decide to get another credit card. If an emergency strikes at a bad financial time for you, then your problems will be far worse to deal with when there’s another credit card debt.
I’m missing out on all the rewards
When people think “do I need a credit card” they often wonder about the wonderful rewards that they’ll receive. Well, it doesn’t always work out to be that beneficial in the scheme of things. If you are someone that never misses a payment, it might be right for you. But, missing just one payment could leave you facing serious interest and penalty charges. Honestly, this is the reason why credit card companies have attractive offers because they know that people do miss payments and that’s how they make their money.
Do I really need another credit card?
If you’re still wondering “do I need a credit card” or you’re worried that you’ll apply credit card debt onto your existing debts, we’re here to help. Contact our friendly team today for some honest advice and discuss ways in which we can lower your debt to gain back your financial freedom.