Credit Cards |
By Kenneth Long on January 20, 2010
.jpg.aspx?width=75&height=75) Credit cards are incredibly convenient methods of payment. Some may argue that they are too convenient.
Many people have certainly found themselves overextended by charging more to their credit cards than they were able to repay. Others initially were comfortable with their debt balances but fell into a downward spiral. Perhaps they lost their job. For some, their card issuers changed their repayment terms beyond their ability to keep up.
Credit cards can facilitate payments and build credit. They can also destroy credit when their terms are breached. Knowing the ins and outs of credit cards can help you avoid pitfalls while building a strong credit history.
Prepaid Credit Cards
Many lower income households depend on prepaid credit cards to facilitate transactions when they either cannot qualify for an unsecured credit card or prefer to avoid the headaches. These can be useful for certain households, albeit the costs may be higher.
Rewards Cards
Some credit cards provide incentives for making certain types of transactions, while others reward you based on your overall usage or activity. Rewards cards can be useful and beneficial as long as you do not carry a balance.
Store Cards
Store credit cards are available at a number of retailers. They are generally easier to obtain than major credit cards. They also provide a lower benefit to your credit score.
Charge Cards
Charge cards are a type of card where the balance must be repaid in full at the end of each billing cycle. You cannot roll over part of the balance to the next month, which could prevent you from building up higher debt balances. |
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