Credit
Credit money is money that is backed by a promise to pay made by someone other than the state. Credit is denominated by a unit of account. Unli
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The Advantages and Disadvantages Of Credit
Credit money is money that is backed by a promise to pay made by
someone other than the state. Credit is denominated by a unit of
account. Unlike money (by a strict definition), credit itself cannot
act as a unit of account. Many forms of credit can readily act as a
medium of exchange.
Advantages : If you have an unexpected, large
purchase, credit allows you to buy it instantly and settle up later.
Though you end up paying more, it enables you to spread the cost of
expensive purchases, like computers. And if you shop around for a
low-interest rate, this needn't be too costly.
Disadvantages : It's easy to lose track of what
you've spent - lots of small purchases can quickly add up, especially
as statements come through just once a month. If you don't keep up the
minimum repayment, you can get into trouble. The goods you've purchased
may be repossessed, you'll end up paying a lot more than the item is
worth and you may affect your credit rating - making it hard for you to
get a mortgage, car loan or credit card in future. Credit cards issue a
monthly spending limit.
If you get a credit card, you keep it safe.
If you are a first time credit card user or have had credit cards for years- it is important to know about possible scams that you can be exposed to. Although many credit card companies are perfectly honest- there are also many dishonest ones who want to rip you off. If you are unaware of the...
Rewards credit cards reward cardholders for using the card. In essence- the issuer offers you a financial incentive to buy and use them. The incentive is offered in terms of rebates- store discounts- points that can be redeemed for specific purposes and airline flyer miles.{{left}} Choosing ...
What Is A 0% APR Credit Card? Many of us have heard about them- but has anyone every explained 0% APR credit cards to you? Well- for starters- the APR or annual percentage rate is the rate of interest credit card companies charge on outstanding payments. The amount you are charged depends no...
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