When You Should Use a Credit Card
Contrary to popular belief, credit cards are not all bad! In fact, when used responsibly, credit cards can actually bring lots of benefits that you would not receive if you used a debit card. Here, we are taking you through the different situations in which you should consider opting to use a credit card and not a debit card.
One of the main reasons why credit cards are the optimum choice in certain situations is due to the safety aspects. If you are making purchases online, you are far more likely to be a victim of fraud. However, if you choose to use a credit card it is much easier to avoid potential loses. For example, if you are using a debit card and it is stolen, the money can be used instantly, meaning any legitimate expenses which were scheduled in may bounce which then lands you with fees from banks and creditors become unhappy. Although this situation is not your fault, having these bounced payments will affect your credit score and any fraudulent activity has to first be investigated which can mean you won’t get your money back for a while. In contrast to this, when someone uses a credit card fraudulently, you will not be out of any of your own cash and all you need to do is notify the bank about the fraud.
Paying for Services
Another situation in which it is a good idea to use your credit card is when you are paying someone for their services. For example, if you pay a builder for their services in cash, what then happens if the work that they carried out starts to crumble? It can take months to take this up with the relevant authorities, however, if you use a credit card for these big ticket items, then there is less chance of fraud taking place as credit card issuers resolve these problems. Furthermore, if you dispute a charge then the card issuer can withhold the funds and you won’t be left out of pocket.
If you are going to be making any sort of substantial purchase such as buying a home or a car, then you will need to try and either build up or improve your credit score to be accepted. When you use a credit card responsibly, this will help you to build up credit which is something that a debit card will not do. At BB&T, you can get a credit card with a 0% introductory APR for 15 months and there is no annual fee. Using this credit card and paying it off monthly will then help you to build up your credit score.
Another situation in which we would recommend you use your credit card is when you are on holiday as many places will not even accept a debit card. For example, most rental car companies and hotel want their customers to pay security deposits with their credit cards and if you only have a debit card, they may not accept it or hold more of your money.