There are many people who will claim that everyone needs a credit card, you just need to learn to use it responsibly. They will say there are many good reasons to have a credit card. They are safer than cash, or you need to have at least one for a financial emergency. You also need them to help build your credit rating, and some will tell you that a credit card is mandatory for certain purchases. There are even those who will tell you that credit cards, when used properly, are financially profitable. Let’s look at each one of these reasons for needing a credit card.
They are safer than carrying cash and offer protection from theft
No kidding. But the truth is a debit card is just as safe. If your debit card is lost or stolen you can have it replaced, and if someone gets a hold of your card number and starts making charges, you will be protected. I had this happen to me. I had my debit card number somehow compromised, and there were charges at a gas station in Brooklyn, New York. I was living on the west coast at the time, and I had never been anywhere in New York in my life. My debit card had the charge reversed, and it didn 't cost me any money.
You need to have at least one for a financial emergency
You need a savings to fall back on and not a line of credit. One of the ideas behind this book is to turn you back on credit and begin to achieve independence with a surplus in cash.
You need them to help build your credit rating
A good credit rating means that you have the privilege of paying more for something than you could have paid with cash.
They are mandatory for certain services
There are two primary examples of this. One is renting cars; the other is hotel rooms. In both situations, ...
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...it is better than bad credit, there is a third type of credit that is best of all – NO CREDIT! Unfortunately, in American society, we are drenched with advertisements about buying on credit as well as propaganda about the importance of good credit rating. If we maintain a good credit rating, we will be rewarded by paying lower interest rates on future purchases. This is big business at its best, but it benefits the corporation and not the consumer buying on credit. Do not fall into the debt trap. There is no reason to ever use credit, especially credit cards; they are a sucker’s game.
If you are not in debt, do not start now. If you have any debt and it is manageable, you need to think about paying it off as soon as possible. In the long run, you will be better off. However, if you have a lot of debt and are not sure what to do about it, then read the next section.
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