Nowadays, it is easy to apply for and be given a credit card. However, some people experience problems when they are not able to pay their debts back. Do the advantages of credit cards outweigh the disadvantages?
There is easy access to gain a credit card these days. However, some people face problems related to paying their debts back. While credit cards can lead to some problems, they can offer far greater benefits.
On the one hand, the potential main drawback of using a credit card is the potential for overspending. Debts are usually seen as easy money, thereby leading to temptation and impulse, unplanned purchases. In other words, acquiring money without hard work with just a few clicks on their gadgets may urge people to spend this money in an unwise way. Statistics show that 84% of all shoppers with credit cards make impulse purchases worldwide, as people often prioritise immediate satisfaction over rational decision-making. This explains why easy access to debts can create a potential for abuse, encouraging people to overspend.
On the other hand, credit cards can be really advantageous during emergencies. During their lives, people may need to deal with unexpected expenses, and not all people are capable of solving these financial problems. In such cases, credit cards can provide people with money needed to them to solve the financial hardship. For example, 43% of Americans with credit card debt say it is due to emergencies. Therefore, with the help of their credit cards, people can instantly resolve unexpected financial issues in their lives.
Moreover, credit cards can guarantee certain benefits, which are particularly important in today's world. These days, making big purchases, such as buying a house or a personal car, can be financially challenging as they require having a significant amount of money all at once, which many people cannot afford. However, by using their credit cards responsibly and paying debts back on time, people can build a positive credit card history, which often eases the process of securing loans, mortgages, and other financial products such as houses. This is the reason why a credit card can be utilised to the advantage of its holder when buying different products.
In conclusion, it cannot be overlooked that credit cards may urge people to make impulse purchases. Nonetheless, the advantages credit cards offer are far more significant because credit cards can provide a vital financial safety net during emergencies and financial capability to purchase products people cannot afford otherwise.
@IELTSwithAliy