All About Credit
By Jordan Korte
What is Credit?
Credit is the ability of a customer to obtain goods or services before actual payment, based on the trust that the payment will be made in the future.
Advantage #1:
An advantage of credit is protection over purchases that comes from your credit statement which shows every purchase made for that month, allowing you to see if any purchases have been made from a credit fraud.
Advantage #2:
Another advantage of credit is the ability to build up your credit score to be able to purchase more and more without maxing out your card as long as you are responsible and pay in full each month.
Advantage #3:
One more advantage of credit is the ability to have an emergency option for spending if you happen to have no cash on you or you need to buy something the day of but don't have enough money at that time.
Disadvantage #1:
A disadvantage of credit is blowing your budget by spending money that you won't be able to cover by the end of the month, which turns into debt with interest.
Disadvantage #2:
Another disadvantage is gaining a ton of interest on debt that you haven't payed to the credit card company by the end of the month that keeps piling up each month that it isn't payed in full.
Disadvantage #3:
One more disadvantage of credit is credit fraud. This is when someone accesses your credit information by either stealing your personal card or creating a card with your information and spends money on the card that counts as your spending.