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Can credit cards help you financially?

How can credit cards help you financially?

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Advance Personal Finance

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Credit cards can be life-saving when in difficult situations, but there are also other times when those thin pieces of plastic can be useful. Credit Cards help hands down.

If used responsibly, you can actually benefit from using credit cards. Such as earning free points or products for using the card frequently, helping you to better your money management skills, and to save money at certain stores.

This only works if you resist the temptation to splurge just because you have a credit card. Also if you try not to carry a balance from one month to another or if you have to carry a balance, you know that it’s a balance that you’re able to pay off in the near future.

Does it help with your credit score?

Credit cards can also help to improve your credit score with credit building. Like if paid in a timely manner or if it’s used regularly. The age of the account(s) help, how many accounts you currently hold or have had in the past and how many times hard credit inquires have been performed for some type of loan. They also look at how many blemishes are on your credit track record as well.

These can also aid financially in emergency situations. Such as if an emergency fund hasn’t been established or is inadequate. For example, if you lost your job, in need of urgent car care or home repairs or unexpected medical costs.

With credit cards comes electronic banking and therefore records to help track your spending. Also, one of the best benefits with having a credit card is security. For example, if your card is lost or stolen, it is possible and easier to be alerted and to freeze your account unlike with cash.

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