Why We Use Credit Cards

Credit cards are a necessity when establishing a credit score, but that is only one of the reasons we use them. We love the ease and emotional feeling of plastic in hand, and we're so accustomed to plastic that it's hard to imagine life without it.

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First Credit
- We're told as children that a good credit score is a necessity, earned one payment at a time. The creation of pre-paid credit cards made it possible for parents to give credit cards to children without the worry of how much the child might spend.
Types
- It doesn't take long to learn that all credit cards are not created equal. Some credit cards allow the balance to be paid in installments over time. Other credit cards require the balance to be paid in full every month. Some credit cards require a deposit or pre-payment to use.
Convenience
- Convenience is one of the most popular reasons we use credit cards. It's much more convenient to carry a plastic card than cash. Once limited to retail stores and restaurants, credit cards are accepted payment method at clinics, hospitals and other places.
Tracking Expenses
- Credit cards not only make it easy to track expenses, they provide an automatic detailed report for accounting and tax purposes. Some business owners prefer to operate entirely on credit cards. Some credit card companies send detailed end-of-the-year reports with expenses categorized and totaled.
Rewards
- When credit card companies started offering cash-back rewards, credit card use increased. In addition to a percentage cash-back reward, some credit cards feature an automatic savings plan. The credit card is always charged an even dollar amount for purchases and the change goes into the savings account.
Warning
- One big drawback with credit cards is the fact they are so easy to use. It's easy to pull out the plastic without thinking about how much expense is actually building up.