Why do you even need a credit card?

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For most people, owning a credit card is something as basic as eating, but it’s worth mentioning that they are can actually become very dangerous, opening the door to overspending easily!

According to The Motley Fool, the typical American household has around $16,000 in debt, mostly because they own credit cards and don’t know where to stop.

Is it actually worth it?

Obviously, this leads to a big and important question: If you’re not fancying paying interest and don’t want the stress that comes with making monthly payments, is it actually worth getting a credit card in the first place?

After all, you pay all your bills from your savings and checking account, so what’s the sense of getting something which can be very tempting, in a negative way?

On the other side, a credit card also implies a couple of benefits, like cash-back rewards or purchases protection. Even more, in some cases, you kind of need a credit card in order to access specific services, like making a hotel reservation for example.

But the most important benefit a credit card brings is the ability to boost your credit score, as you can establish a solid payment history. Besides this, it helps you with your credit utilization ratio, which measures the extent to which you’re using your total available line of credit. Basically, the lower that number, the more it will help your score.

How to use your credit card wisely?

If you don’t want to worry about stacking up debt each month, there’s one general rule you need to follow. To be more specific, we’re talking about only charging what you can afford to pay off by the end of each month, then mark your payment due date on a calendar, in order to make sure you won’t miss it. You can also set a recurring payment and you really don’t need to worry about this anymore!

Finally, make sure you go through your card’s rewards program, in order to get the best out of it. If you can get double points on gas, for example, use it every time you refill!

The idea is easy: you can get through without a credit card, but as long as you can avoid overspending, it’s definitely worth getting one.

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