Credit Cards 101

Credit Cards 101
What is​ a​ credit card? How does it​ differ from actual money? How does it​ work? Will it​ really replace money? Can this piece of​ plastic really buy me stuff?
These are the​ sort of​ questions that we ask ourselves or​ hear about from other people .​
We really wonder if​ these are true or​ not,​ or​ if​ these questions are valid or​ not .​
Let’s take a​ closer look at​ credit cards and how it​ is​ beginning to​ shape (if it​ hasn’t already done so) the​ way we live at​ present.
First off,​ what exactly is​ a​ credit card? the​ Columbia Encyclopedia defines it​ as​ a​ device used to​ obtain consumer credit at​ the​ time of​ purchasing an​ article or​ service .​
Basically,​ a​ credit card is​ the​ plastic,​ I.D .​
like thing with a​ black magnetic strip across the​ back which can be used to​ make purchases via signing .​
How is​ this possible? the​ seller receives the​ credit card information from the​ customer by swiping the​ magnetic strip into a​ specialized device that can specifically read the​ card .​
The bank or​ credit card supplier then pays the​ seller .​
The customer and the​ credit card supplier then do business with the​ customer paying the​ bank the​ amount he owes via a​ monthly fee .​
If he is​ unable to​ pay the​ amount in​ full,​ he has the​ option of​ paying a​ minimum balance; however,​ the​ remaining balance is​ subject to​ an​ interest rate,​ usually around 3.5% .​
Once you​ get the​ experience of​ using your own credit card,​ you​ will actually find out that it​ is​ a​ simple process – just give the​ card,​ sign,​ get your card back,​ and pay later.
Credit cards appear to​ be the​ thing of​ the​ present,​ and will go on​ growing towards the​ future .​
It would not come as​ a​ surprise to​ many if​ it​ totally replaces cash in​ a​ few years’ time .​
As the​ days pass by,​ credit cards grow more and more popular with a​ lot more people .​
More and more business establishments are accepting credit cards,​ with the​ trend not seeming to​ stop anytime in​ the​ future .​
Think about it​ – would you​ rather carry a​ few inches thick of​ cash in​ your wallet or​ purse,​ or​ a​ lightweight,​ plastic,​ I.D .​
size thing that you​ can use for the​ same function,​ or​ even more .​
The cash,​ once you’ve run out of​ it,​ you​ can’t purchase any more .​
With the​ credit card,​ you​ can purchase a​ whole lot more in​ one day .​
Many people nowadays shop with the​ power of​ the​ credit card at​ their disposal,​ bringing home bags and bags of​ shopping items,​ all without having to​ pay a​ single dollar in​ cash that day.
Yes,​ this tiny piece of​ plastic can be useful in​ shopping .​
Before,​ only a​ few select stores would accept credit cards; now,​ only a​ few select stores DO NOT accept credit cards .​
Almost anything can be acquired with a​ credit card .​
You can even make online purchases now .​
Online purchases are rapidly growing in​ popularity .​
You just need to​ have a​ computer,​ internet connection,​ and a​ credit card to​ make it​ happen.
Credit cards have a​ thing called credit limit .​
It is​ the​ maximum amount of​ credit you​ are allowed in​ a​ month .​
Anything over it​ will not be credited for that month .​
If you​ try to​ make a​ purchase when your credit limit is​ full,​ your credit card will be rejected until you​ are able to​ pay at​ least the​ minimum balance owed for that particular month .​
In some cases,​ credit card providers will give you​ a​ secured credit card,​ wherein you​ have to​ give a​ deposit in​ cash which in​ turn will be your credit limit (deposit $1000 – that will be your credit limit) .​
Secured credit cards are usually for those people deemed by the​ provider to​ have bad credit standing.
Credit cards are slowly transforming the​ way people live .​
It is​ like a​ security blanket of​ sorts for a​ lot of​ people .​
However,​ it​ can also be a​ bad thing since you​ have the​ ability to​ overspend in​ an​ instant .​
Owning a​ credit card is​ a​ nice thing,​ provided that you​ use it​ responsibly and make sure it​ doesn’t control your life,​ because it​ has the​ power to​ do so.
Credit Cards 101 Credit Cards 101 Reviewed by Henda Yesti on December 31, 2017 Rating: 5

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