Just like a coin has two sides, every single one has its own advantages and disadvantages. When you are deciding whether to buy a credit card or not, you will have to think about your budget and how it will affect it. It is a proven fact that credit cards do not affect your credit health negatively. Instead if used properly, they will enhance your credit score and report.
But, if we look at the cons of the credit cards, we are able to assess that they have their own disadvantages. Let us examine some
1:Overspending
When you have access to credit cards, you will tend to overspend as you are able to purchase something without actually paying for it from your own pocket. This becomes a habit and will lead to a debt that you may not be able to repay and you can end up spending a lot on the penalties.
2:High Interest Charges
If you are using credit cards for the fact that you will need emergency funds at some point in time, then you are paying a very large amount for it. This needs to be evaluated and you need to assess whether you actually need to spend using a credit card.
3:Minimum Due Charges
A lot of new users make this mistake if paying only the minimum due charges on the credit card. Due to this the interest paid on the transactions are quite high and you end up paying more than what actually has to be paid.
4:Chances of Fraud
Just like your money, credit cards can also be stolen and you can notify the issuer once you get a hint of it. The issuer can block the card immediately. Sometimes, you do not realise the same before you get your monthly statement from the issuer.
5:Surcharges
Credit card companies charge you to pay using credit cards and these charges can pile up to almost 3%. Such additional costs are incurred just as a price for using plastic to pay for your expenses.
Also Read: What Are The Pros And Cons Of Credit Cards?