The credit card can be your ally or your enemy depending on whether you use it wisely or your impulsiveness will take control.
If you use caution and foresight with credit, you adopt the right behavior.
To build a good credit record
If you pay for your purchases with a credit card, pay at each installment the total amount borrowed, you build a good credit record. This is an advantage when time comes to borrow more substantial amounts, for example, to buy a house.
To pay for unexpected expenses
Make sure you pay down your credit card in full at maturity, to avoid having to pay interest.
However, there is a better way than credit card to pay for unexpected expenses: save and build an emergency fund.
To book or rent goods and services
The credit card comes in handy when time comes to rent a car or book theater tickets. However, the same rule applies with respect to the balance payment of the card: pay it in full at the end of your statement.
Accumulate reward points
Some credit cards offer reward points for the purchase of products and services.
The credit card can hurt you when it’s used impulsively
If you consider credit card as part of your income that you use to supplement your income month: it’s dangerous!
By doing so, you artificially inflate your income and you delude your actual cash inflows.