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Do You Really Need a New Credit Card?

7 September 2010 by CreditCardsCo™

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The bottom line is that you don't really need a credit card. In fact, you can get by without them if you spend your money responsibly. Maybe having one can be handy, but only if you make sure you don't abuse it.

Who should get a credit card?

A lot of people would want you to think that you don't need a credit card because it's mere luxury. That's why you can get by without it. However, there are instances when credit cards become more of a need than a want. In these cases, having a credit card could prove useful. It's always better to think things through before you decide to get a credit card. This, of course, is on a case-to-case basis.

But when would you need a credit card? It's necessary when you're planning to incur expenses but don't have the cash in hand to pay yet. A classic example would be when you're planning to start your own small business. While it's always ideal to start with what you have, not everyone enjoys the privilege of having lots of savings to start with in terms of capital. If the business you're planning to start only needs a couple of one-time purchases (i.e. for equipment, etc.), then you might need a credit card to get you started. In this case, you know how you're going to pay for all that credit — through the profits that you'll potentially earn from your business.

More common instances where credit cards are necessary are when you need to buy something but don't have cash in your bank account. This is common in various emergency cases. When there are things that you must absolutely spend for right then and now, you definitely need a credit card.

Risks of Having a Credit Card

Anything outside those instances above and you might need to contemplate whether you really need a credit card or not. That's because everything else that's got to do with a credit card is a luxury, and this is where all the dangers normally begin.

It might sound ridiculous at first, but many cardholders fall into the trap of thinking that their credit cards are a permanent substitute for money — that they could just make purchases with it when they don't have any cash in their purses or wallets. They end up spending more than they need. When you start thinking that you need a credit card for everything, then there's a problem.

This problem is even worse if the cardholder happens to be a compulsive buyer. Compulsive buyers are those who have a strong tendency to spend whatever money they have. To them, they need a credit card to satisfy their want to buy what's in front of them. It wouldn't matter anymore if they don't need what's on sale or whether they could put it off until their next paycheck. With a credit card, they can buy virtually anything at an instant. A little luxury vs. when you need a credit card might be okay sometimes, but with shopaholics like them — not so much.

Getting a Card for the Wrong Reasons

Don't ever think you need a credit card for anything more than making necessary purchases. Otherwise you'll end up getting lots of these plastic cards for the wrong reasons. For one thing, you're not supposed to get these credit cards just because it features a great rewards program, or that they offer freebies alongside your use of it. These features are merely secondary and should be treated as such. This means that if you don't need a credit card for its primary reasons, then you can definitely get by without anything else that comes with it.

MilesMiles, discounts, competitively lower interest rates — these might sound enticing but don't make it a reason for you to need a credit card. This is because these promos are designed to induce you to make even more purchases — probably more than you can handle. If you're looking for freebies and great discounts, then you don't need a credit card for that. There are other ways for you to get discounts.

Just remember that the general rule is that a credit card should be more of a necessity than a luxury. This means that you should only use a credit card when you need it, not when you feel like it. Learn to use your card responsibly. Use it only when you really need a credit card.

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