Credit Card - A Boon Or A Bane?

@AKRao24 (20725)
India
December 28, 2011 9:47am CST
Having private banks entered the market, now a days availing a Credit Card by any one has become very easy and it can be seen that today many youths are carrying many credit cards with them and utilizing them without any inhibitions for their shopping. There is no problem with this, so long they are in a position to repay the loan amount or the debts on time. The problem starts when these youth who are using these cards impulsively for their shopping and availing some big amounts as the loan. They are finding it very difficult for them to repay, as the interest on such unpaid amounts is too heavy and the principle amount becomes too huge within no time if not paid in time. I heard few cases of the youth who have used their credit cards carelessly and ended up with the finacial troubles. Today because of multinational companies youth are getting good jobs with fairly good salary package. But because of immaturity and unplanned spending these people are facing a finacial crisis at the very beginning of their career! I think people especially the youngsters who are taking up the new jobs should be careful and plan their budget before using the credit card to save the future problems which can be quite irritating and can lead a lot of mental stress! May I have have your kind opinion about this issue? Your opinions will be highly appreciated! Thanks !
2 people like this
10 responses
• India
29 Dec 11
for me its a boon, because i am just fed up with the debit card facilties of the banks, every time i withdraw my own money from the atms they always going to charge some sum , they much changes their policy for debit cards. credit cards are goods and can be use any place. while debit cards have restrictions.
1 person likes this
@AKRao24 (20725)
• India
1 Jan 12
Hello dear Jaihobalodiji! You got a point there! Yes debit cards they attract service charges which vary from bank to bank and this may some times be irritating! Yes, together with this debit cards have set backs as most of them are not accepted in all shops, though now a days they have started accepting them for settling the bills. On the other hand credit cards can be used any where. Yes so long one can use the credit card with a discipline I think there is problem! The problem starts once the loans availed on them starts get accumulated to become a big burden later on! Thanks for responding
1 person likes this
• India
1 Jan 12
pleasure
• India
3 Jan 12
thats law my dear stowyk, they are also giving services to extract your money at any place through debit card and its good so they are charging for it. my point is they are charging too much, i mean 20 rs for every transaction is more that enough.
@megamatt (14327)
• United States
1 Jan 12
There are a lot of people who really think that the credit card is a license to have more luxuries than they really should have. Sadly, the uneducated people who use the credit card in an irresponsible manner are just really something that is really causing a lot of people really suffer because of them. Credit cards are not something that is a toy. Yet, there are going to really be a lot of times where people are not going to really be ready for a credit card. They misunderstand that is only something that should really be done rather sparingly. Yet, people use and rather misuse their credit cards. It is a rather frustrating thing for sure and people dig themselves into a hole that they quite cannot get out.
1 person likes this
@AKRao24 (20725)
• India
13 Jan 12
That is the point dear Megamatt! People without having the sound knowledge about the credit cards and the liabilities attached with them often misuse them to acquire some luxurious things in their lives! The credit card which looks a boon to them initially becomes a noose around their neck when they are asked to pay the interest through their noses! So I think people should be very careful and should understand about the credit card and the complications associated with it! unnecessary use of the credit card will definitely is nothing but digging one's own grave, if one is not equipped with proper job to repay the debts incurred because of this! Thanks for responding dear friend!
@narnia007 (1051)
• India
29 Dec 11
I am not much of a fan of credit cards,because they charge you a interest for the credits and charge an annual fees for using it.It will come in handy when you don't have money in your account and you want to purchase something.But this fact has ruined many people's life who are careless enough to use credits off limits and finally bankrupt because of the interests of those credits.Reason I got mine is that,many online sites and international purchase sites accept only credit cards and not debit cards.I do not know why this came into existence,but hope they start to accept debit cards too.
1 person likes this
@AKRao24 (20725)
• India
3 Jan 12
Yes, dear Narnia, I too agree with your views! They not only charge high interest rates but they also impose service charges annually. I agree that such cards can be useful to procure the things when we don't have money to do so, but for me this is not a good idea and I will never try o purchaser buy a thing If I don't have money with me. This is the beginning of the financial down fall in many people who buy the things without having any planning and later on they face all sort of troubles when they are unable to clear the loans! Some times the tension can be too high as such people can be pulled into the court of law as defaulters! Yes, I too fail to understand why many international transactions want a credit card online and not debit card! Even in big hotels also they want a credit card to book a room! I agree and think in future the debit cards can be used for this purpose! Thanks !
@kingparker (9698)
• United States
29 Dec 11
You are saying it right. Myself can be one good example of it. I was an irresponsible individual, and I hate to say that I overuse my credit cards on several occasions. Now, I truly regret my action, and I should tell you, it is not that easy to take care of all that debt you spent. So, be responsible, and do not overuse your credit cards anymore.
1 person likes this
@AKRao24 (20725)
• India
1 Jan 12
Hello Dear Kingparker! Thanks for sharing your first hand experience regarding the overuse of credit cards! I hope the youngsters going through this discussion will find it interesting and informative. Having a strict control on one self, discipline in spending and planning the budget are some factors one should really take not consideration while using the credit cards! Thanks for responding! I appreciate your frank opinion!
1 person likes this
@mythociate (15763)
• Oklahoma City, Oklahoma
23 Jul 12
Both. It's just like the "grace" given by Lord Jesus Christ to His disciples: it doesn't 'make you sinless' (or 'give you anymore money'), but you can use it (either 'forgive others' or 'spend big') just as if the grace/money is all-yours. What happened to me: I was a college-kid, and of course they were giving cards away left-and-right. Deal is (and this didn't quite hit me at the time), they were all "rich kids" ... at least compared to me they were---me, who has no substantial income and who's not "heir of a huge estate." And I was fine with 'owing up to $1000 and paying at least $10 a month.' But then the magazine-subscription-scammers got a hold of me, charged me as if I was makin` the money I deserve ... and the fact that I do deserve it doesn't change the fact that the money-people are not (as of July 23, 2012) giving me the money I deserve! Being the ONLY True Christian on Earth ( you're right, I don't believe it either ), I cannot "force" people to give me what I deserve; so I got stuck holding the load of debt without enough cash to carry it!
@AKRao24 (20725)
• India
28 Jul 12
That is a nice first hand experience you have quoted dear Mythociate! Many a times people under innocence may get trapped to such schemes and ed up with a big debt! Thanks for responding!
@ravisivan (14055)
• India
10 Oct 12
yes. there was a time when people in advanced countries started drawing two or three times more than their monthly salary form credit cards. that resulted in huge interest being charged and caused strain on them. mythociate: Then how do you manage your credit portfolio now? I understand default in cards may cause loss of credit report favouring one. Probably you are now into preaching religion and your expectations have come down.
@mythociate (15763)
• Oklahoma City, Oklahoma
11 Oct 12
I wish I could say 'I don't have credit.' I might not, as I'm not keeping track of whatever it might be; but 'whether it exists or not' isn't my job to keep track of, just like the 'credit' itself is not mine to keep track of. It's sort of like celebrity-relationships: Tom Cruise & Katie Holmes, Johnny Depp & Vanessa Paradis, Miley Cyrus & Liam Hemsworth; the media says they are 'broken-up, broken-up & hooked-up' (respectively), but who's to say?
• India
28 Dec 11
Hello, you have pinned it correctly, using the card impulsively will definitely make it a bane for you, far from remaining a boon! I have been using my credit card for more than 4 years now and I use it only with careful planning of my finances. I base all my purchases on how and when I am going to pay the money back, otherwise I just resist buying with it. The key is to keep paying at least small amounts of your bill and not let it accumulate to a big sum, the interest these banks charge is obscenely exorbitant! Treat it like a debit card, buy only if you are sure that you make the payment next month, only then use it!
@AKRao24 (20725)
• India
28 Dec 11
Yes, spending without thinking and without having any future vision with the help of credit card will definitely make one's life miserable. If planned carefully and used the credit card can be a big boon! Yes,in the event of using the card it becomes a must that one should regularly repay the amount as the rates charged by the banks on such loans are too big.Thus while agreeing with you I would say that one should only use the credit card only if the bills can be settled by next month itself! Thanks for responding! I am impressed with your views!
1 person likes this
• India
30 Dec 11
You are most welcome! Ultimately it all depends on us whether we want such a thing as a credit card to really help us or whether to turn it into a nightmare!
1 person likes this
@ravisivan (14055)
• India
22 Aug 12
It is a good point. One should learn how to use credit card. for example if your salary is Rs.50000 then you must use the credit card for maximum of 12500. i.e. 25% of your salary. It is because next month you must be in a position to repay the credit card bill. otherwise the balance will earn interest and interest will earn interest and it will become a big burden. this is the problem of youngsters in usa. they spend more than their income and end up in a crisis.
@AKRao24 (20725)
• India
10 Oct 12
You are right dear Ravi Sir! I fact I feel most of the youngsters don't even have the basics about the rates of interest the bank is charging and also about the compounding of the interest! It is under the influence of newly forming hormones in the body these people are behaving in a reckless fashion to suffer later on in their lives. Credit cards are like double edged swords if misused they can make turn our lives into hell! Thanks!
@maximax8 (28559)
• United Kingdom
7 Jan 12
If a person is money wise having a zero percent credit car is a good idea. In the autumn I found a credit card deal with sixteen months zero percent interest. I got it and put expenses like my flight to Argentina. I know I have until August this year to pay it all off. Every month I get a credit card bill. I pay more than the minimum amount but not the total amount. I have got another credit card but it does charge interest. I try to pay it off in full each month when I get the credit card bill. Otherwise I would pay interest on the money I have spent using my credit card. When I joined a university many banks gave me credit card and debit card heavy encouragement. I liked getting a student grant and then opening a student bank account. It came with a debit card and a credit card. I got forty pounds for opening that. It was lovely when I got more money because the student grants people had made a mistake. Therefore I opened a second bank account to get thirty pounds. Then I had seventy pounds altogether, two debit cards and a credit card. During my degree days at university I didn't spend all that much on my credit card. I did however when I traveled to New Zealand and the Pacific Islands. It took me two years to pay off that debt. It was a struggle to pay it all off. I loved getting a statement for zero pounds. It is easy to go overboard with spending using a credit card near the beginning a career.
@AKRao24 (20725)
• India
16 Feb 12
Dear Maximax from your response it is very evident that you are a person who think very carefully and implement the things after considering pros and cons of the any thing! Inspite of having credit cards you were careful and spent minimum amount from them! You tried to use the credit card with 0% interest! In spite of all these precautions and plannings still you took about two years to repay your loan amount you availed through the credit card, which was bit difficult for you to repay! In spite of all these experiences still you felt that one can go overboard with spending at the starting point of one's career! So in nut shell credit cards are to be used carefully and cautiously to avoid the unwanted penalties imposed by the banks! Thanks!
@tabatha7 (189)
3 Jan 12
I agree with you, but it's not just young people who are having problems with credit cards. Like a few years ago, I tried to buy a house that looked great on the outside... but there were sooo many problems with it & I didn't realize it until we moved in. There was no refrigerator; I thought they were leaving it for me. The dishwasher was broken & I didn't know it until we moved in. The air conditioner didn't work & it was hotter than anything in that house in the summer. The furnace stopped working, so it was ice-cold in there in the winter... There was a problem with the water/sewage pipes... The hot water heater went out & flooded the basement... At any rate, I got a couple of credit cards to help me fix some of this stuff... and things just kept going out on me left & right... These kinds of catastrophes can happen to the best of us, so yeah, we need to teach our youth to be responsible... but when bad things happen, sometimes we have to rely on credit cards.
@AKRao24 (20725)
• India
16 Feb 12
Yes dear Tabatha!I can understand your situation and your using the credit card to cope with with the prevailing conditions then! You are a matured man having capability of repaying the credit or the loan and knowing all these things under duress you have availed the loan or used your credit card! That was a 'must' situation for you and you have used your credit card to get rid of the problem you were facing at that time! Yes, under such circumstances when we don't have any other alternative left for us credit cards can be of big use for us! This is one of the plus points and I think in fact the credit cards are meant for such situations only! They are not to be spend lavishly without knowing or understanding the consequences! Thanks!
• Philippines
1 Jan 12
At first you would indeed say it's a heavensent. Beacause let's admit it or not, it is really easier and a lot more convenient when doing a shopping. It is also safer to carry around. plus the convincing promotion of the agents telling how low their interest rates offer. But as soon as grab their offers you can see how high their interests rates. How huge their penalties and the hidden fees which at first you haven't discussed with, you would difinitely say it's a hold up. And it is killing you softly because it reaches to the point that you can't pay the charges and the interests anymore.
@AKRao24 (20725)
• India
16 Feb 12
You are right dear Sheenmadness! The Sales people present only the right side of the scenario hiding the dark part! People tend to get trapped in such sales gimmick as they don't have idea about the heavy penalties they are subjected to in case they are not in a position to repay the availed loan on the time! Many youngsters especially who entered their careers recently without realizing all these things they go in for these credit cards and they spend the money lavishly without thinking of troubles they can encounter in case they fail to repay the availed loan! Many youngsters are becoming defaulters and they are spoiling their careers as because of the pressure exerted by the banks make them too stressed affecting their work, thus spoiling their careers! So in my opinion one has to be very careful and thoughtful while using the credit cards! It is always better to stay away from over spending as far as possible! Thanks !