• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Advantages and Disadvantages of Credit Cards

Extracts from this document...


Jingzhen Huang Personal finance 12/13/2012 Advantages and Disadvantages of Credit Cards Have you sees the movie Mixed Out? This movie is so realistic and close to our daily life. It describes how people abuse their credit card and fall into a debt crisis without being able to pay off. In our daily life, credit cards have become a popular payment method in many businesses, such as when we to shop in different stores and buy food in restaurants. Indeed, the credit card has been used by most of people in the world. This piece of plastic is easy to carry anywhere and useful for buying anything without paying cash. Thus, credit cards have become a most convenient form of payment for almost everything. However, using the credit card not only has advantage, but also disadvantages that will be also discussed in this essay. How does credit card affect our daily life? We have to learn how to use the credit card wisely in order to prevent debt crisis. ...read more.


In this case, you will get the points by using your credit card, and then receive the rewards after reaching a certain point. Moreover, there are not only advantages, but also disadvantages to using credit cards. Sometimes, credit cards might cause huge problems to individuals. For instance, credit cards entail high interest rates. Many people use their credit cards without feeling that they are spending money because the money is not being taken right away out of their pocket. In addition, they don?t how much exactly they spent until they get their monthly statement at the end of month. The problem is even increased if they forget to pay the bill on time. This is the credit card company will charge high interest fees or late fees that sometimes can reach to more than 25 dollars. Also, if people just pay their minimum payment every month this means that they just paid their interest, not the principal amount to begin with they used. In this way, they will have less budget flexibility in the future because their part of take-home money already used in the past. ...read more.


As a college student, I learn the lesson from my personal finance how to use the credit card wisely. The chapter tells all the cardholders be aware of the credit card. If you do not have enough money, do not use or purchase things that exceed your budget with your credit card. Generally, people who have a lot of credit cards should not have them because they do not have enough money to pay off the principle or sometimes cannot payoff minimum payment. They are stuck with extra fees and interest penalties. After you use your credit card, you have to pay off your bill every month. It is so simple and easy to get rid of interest, and this extra money you paid that you can get something else. As cardholders, it is really important for us to know to purchase within our budget, and do not exceed our own limit. Having a credit card not a bad idea, it is depend on how your use your card. If everyone knows all the knowledge about credit card, it will not bring out so many problems to you no matter how many cards you have. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level Accounting & Financial Management section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Accounting & Financial Management essays

  1. A2 Business CourseWork

    Community projects: This largely improves their corporate image which makes customers approve the business more and want to shop there. Las year Tesco gave over �50 million to charities and projects. Donating of this amount cannot be given by other competitors because they do not generate enough revenue.

  2. Sources Of Finance

    eliminates the business from having to borrow money to purchases the item as only a small fee is paid to hire the asset. * Any businesses can use hire purchases to obtain assets as a business plan or interest rates are not used in this source of finance.

  1. Statement of financial problem. Should Northrop National Bank extend a line of credit ...

    ($93,000) ($138,000) Decrease in Accounts Payable ($13,000) Cash flow from operations ($5,000) ($80,000) ($170,000) Because a statement of cash flows provides details as to how the cash account changed during a period, the period of 1988 for Butler Lumber becomes an initial starting point from which we can begin a comparison.

  2. The company I'm reporting on is Kraft Foods Incorporated - accounting principles.

    Balance Sheet Most Significant Current Assets and Current Liabilities The most significant current assets are account receivables. This is because as the Company produces goods, they are sold on account to many stores throughout the world. Not many other current assets have changed that much over the past couple years.

  1. U.S. Subprime loan Issue

    Sub-prime lending originated in the US and had evolved with the realization of a demand in the marketplace and businesses providing a supply to meet it coupled with the unwillingness on the part of legislators at the national level to recognize the inherent risks to consumers (wikipedia, 2008).

  2. Autralia's Retail Loan Rate Changes

    A loosening in monetary policy involves a reduction in the cash rate, which should feed through to other interest rates, it should result in an outflow capital from Australia to countries where interest rates are higher. Resulting a reduction in the demand for Australian dollars on foreign exchange markets.

  1. Sources of Finance

    With the issued rights, the existing shareholders have the privilege to buy a specified number of new shares from the firm at a specified price within a specified time (http://en.wikipedia.org/wiki/Rights_issue). The website asserted that offered right issue to all existing shareholders may be rejected, accepted or accepted partly by the shareholders.

  2. The maintenance of accurate records supplies the company with the financial data that assists ...

    Businesses should keep an eye on the rate of interest charged on any form of loan, in order to discover what the right time is to obtain external finance. Recently the bank of England stated that it wants to cut interest rates due to the credit crises the economy is suffering from.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work