Do you really need a Credit Card?
After struggling with paying off their credit card debt, a lot of people swear that they will never have another credit card again. In fact, many debt counselors often hear their clients say this after applying for a debt consolidation loan. While those clients go on to use debt consolidation to get out of debt, however, a lot of them decide to keep one or two credit cards open, just in case.
If you use a debt consolidation loan correctly, you should have a healthy nest egg of savings built up and no debt payments when you’re done paying your loan off. With that new found savings, many people decide that there is no reason for them to have a credit card. After all, they assume, if a credit card is only supposed to help them pay for an emergency, and they have the cash savings to cover an unexpected expense, what’s the point in keeping a card open?
For the most part, these people are correct in assuming that they really don’t need a credit card to help them with unexpected expenses. In the event of a large emergency, however, they may wish that they had kept one card open. Credit cards can allow a person to access thousands of dollars that they otherwise wouldn’t have available. That allows them to get cash for major home repairs after a natural disaster or sustain a family through months of unemployment.
Other people have realized that they like to have a credit card in order to make certain financial transactions easier. Purchasing anything online, for example, is easier with a credit card. While many website accept bank draft, a lot of people like the added layer of security that comes with using one is fraud protection. People who travel have also discovered that bookings are much easier to deal with than debit card bookings, which tend to withdraw security deposits for airline tickets, rental cars, and hotel rooms. While these fees are always refunded, a simple weekend trip can leave a person without access to hundreds of dollars of their own money.
<p data-sp-element=”content”>If you decide to keep a single card around after going through debt consolidation, be sure to pick a card with no annual fee or minimum charge amount. Keep the card in a secure location in your home; don’t carry it in your wallet where you might be tempted to use it.