Advantages and disadvantages of consumer credit
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What are Credit Cards?A form of money (instant spending power) that provides both the capacity to buy goods and services and the capacity to borrow funds. A Brief History of Credit Cards
Explosive Growth of CardsCredit card accounts grew rapidly after they first appeared. In fact, by the turn into the 21st Century U.S. banks alone had well over $650 billion in credit card loans. Why did they grow so fast? The principal reasons were:
Potential Dangers and Risks with Credit Cards
Good Financial Management Practices with Credit Cards
Some Suggestions for Good Credit Card Management
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What are some advantages of consumer credit?A consumer credit system allows consumers to borrow money or incur debt, and to defer repayment of that money over time. Having credit enables consumers to buy goods or assets without having to pay for them in cash at the time of purchase.
What are the disadvantages of using credit as a consumer?You have to budget for regular repayments.. Interest adds to the cost of the debt.. Having to repay a loan limits the amount of money you have available, now and in the future, for other goals or needs.. If you don't repay loans it will result in a bad credit history, making it more difficult to borrow in the future.. What are the disadvantages and disadvantages of credit?Using credit also has some disadvantages. Credit almost always costs money. You have to decide if the item is worth the extra expense of interest paid, the rate of interest and possible fees. It can become a habit and encourages overspending.
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