Advantages and disadvantages of using credit
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Transcript of Advantages and disadvantages of using credit
Credit Card
© Family Economics & Financial Education –Updated March 2010– Credit Unit – Understanding a Credit CardFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The
University of Arizona
Credit Card
1.4.1.G1
Advantages to using Credit Cards
AdvantagesConvenient payment
toolUseful for emergencies
Often required to hold a reservation
Able to purchase “big ticket” items and spread
out payments
Protection against fraud
Opportunity to establish a positive credit history
Online shopping is safer than using a debit card
because of the Fair Credit Billing Act protectionPossibility of receiving
bonuses, such as frequent flyer miles or cash rebates
Credit Card
© Family Economics & Financial Education –Updated March 2010– Credit Unit – Understanding a Credit CardFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at The
University of Arizona
Credit Card
1.4.1.G1
Disadvantages to using Credit Cards
DisadvantagesInterest can be costly
when a balance is revolvedAdditional
penalty fees may apply
Tempting to overspend
Risk of identity theft
Responsible for lost/stolen cards
Applying for multiple accounts can lower your
credit score