About the Disadvantages of a Credit Card

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A disadvantage of using a credit card is that it can be a potential trap for using cash solely for debt obligations. Avoid excessive credit debt and other financial problems with help from a registered financial consultant in this free video on money management and personal finance.

Part of the Video Series: Money Management
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Video Transcript

This is financial adviser Patrick Munro talking about the potential disadvantages of a credit card. Always remember this motto. Cash is king. If you have cash, there's no need for a credit card or a credit anything. But cash is becoming a commodity that is not in use. We're in a paperless society it would seem no days most evidenced by the fact that everyone carries around a debit card. We'll get to that in a future segment. But there are disadvantages of credit cards. And the most notable one is that it can be a potential trap to drag you down to a point where your cash as I mentioned is used only for debt obligations. Which means you have... you no longer have any excess cash available. This is a huge disadvantage and you want to avoid debt by being very mindful of the credit cards that you do have and their usage overall. So mindful of your credit's score... when you have a great credit score, you'll be given a lot of credit card offers. It's always a potential hazard for you to respond to those credit card offers and get into too much credit card debt. This is Patrick Munro talking about the potential disadvantages of credit cards.

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