Good credit history credit Vs Evil

There is a general misconception that all credit card loans and personal loans are bad. We often hear people are advised to stay away from loans, credit cards and struggling to pay your debts as soon as possible.

This belief may work for some people who happened to risk profiles can have very low tolerance. The truth is that with proper planning, budgeting and targeted spending, credit cards can be a great support.

So what makes a good credit?

Shopping in "interest free for a certain period" - Actually, this can benefit economically. For example, when we have reserved a certain amount to buy that flat screen TV and this amount is being kept in a bank account that high interest earning 10% annually, would be desirable to acquire the money in reality TV on credit with interest free period runs until 12 months. It might actually win a few hundred dollars in interest over reward points credit card.

Line of credit and credit rating - If you pay your balance in full each month actually improve your credit score and convince banks to lend money at low interest rates. This loan, for example, at an annual rate of 6% can be used to finance business projects a profit of 20% pa to see that not all loans are bad after all!

Emergency expenses - Life can be full of uncertainties and fluctuations. There are times when no matter how well you plan certain events happen just as a car accident, hospitalization, or who simply forgot to get cash. This is where a credit card can be very useful. However, a need to be careful, because with that green scarf on sale 85% does not count as "emergency spending!

Business owners: speed, capacity management and record keeping - Use a credit card to pay for the company to save time than income, such as small routine purchases such as gasoline, tolls, etc. This eliminate concern if incomes are missing or unavailable, as you can always refer to his statements as proof of purchase and payment

Shopping online can be cheaper than the store of purchase - is almost a known fact that the Internet offers great deals for all foreseeable purchases of big ticket items like refrigerator, sofa, for smaller gadgets such as pins and needles. To be in the game you need the "plastic" to make payments and save hundreds of dollars in discounts and also with better varieties and options.

But there must be some bad credit issues?

Push the "plastic" too often in spending on frivolous purchases - like buying shoes brand new handbags when you already have a closet full or make a deposit for that flashy sports car is not a good idea. This is where it would be dangerous to fall into the "spender" and category "spending more than you earn"

The credit card fraud - Despite numerous safeguards and precautions in place, credit card fraud still occur occasionally causing financial losses and identity theft.