2023-11-28 06:41:30
Written in LIFESTYLE on 11/27/2023 · 10:02 p.m.
Credit cards have become inseparable companions for many people when making purchases., whether online or in physical stores, in a simpler and more convenient way. These small pieces of plastic not only offer benefits, but also a completely open door to the financial world. However, Like any tool, they must be handled with care.
The biggest fear of people who have credit cards is interest, since they can become debt and, at the same time, financial nightmares.
Having a credit card is a responsibility. (unsplash)
What are credit cards used for?
They are very useful for their countless functions. Some advantages of having one are:
Payment flexibility: You can pay for your purchases in installments with promotions. Security: You free yourself from cash fraud, although it is also necessary to take care of bank fraud. Benefits: Some banks offer additional advantages when using cards, such as points, cash back or interest-free monthly payments.
However, among the dark side of having a credit card are interest, excessive expenses when you do not know how to use them, and debt.
Credit cards make it easy to shop online. (Unsplash)
Before choosing a credit card, here are three tips that BBVA bank suggests following:
Compare the CAT: This is the Total Annual Cost, which will help you understand the total amount you must pay. It is made up of the interest rate charged by the bank and additional commissions. If you have questions, ask your advisor before processing the card. Choose a card that’s right for you: Each bank has its own cards, each with different benefits and annual fees. Some even do not charge an annual fee if you make a minimum purchase per month. Review the options that interest you and ask about the credit limit. What will you use the credit card for?: Answering this question is important to be clear about what you will spend and how you will manage your budget.
Honestly analyzing these tips will give you an idea of whether it is really necessary to apply for a credit card. It should be noted that, if possible, having a first credit card will help you establish a credit history that will work for your financial future. The basic rule that many bank advisors advise is to pay on time and use no more than 30% of the amount of credit granted to you.
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