Believe it or not, the way society, especially the commercial side, is set up these days, the only alternative to using credit is to pay cash for everything. But its actually quite hard to do that. For example, if you want to rent a car, you have to have a credit card, even if you pay cash for the rental. The reason for that is because once a company has your credit card with your signature, theyll never lose money. If you default on anything, or if extra charges come up later, all they do is charge your credit card. Many companies require a credit card before theyll do any kind of business with you, for that very reason. After you enter the workforce, its a good idea to apply for a credit card with a small limit. Any one of the major credit card companies will help you. Those companies are Visa, MasterCard and American Express. Buy something with your credit card, and pay it off as fast as you can. Thats the basics of establishing a good credit record. If you continue to do that, buying bigger and bigger items and paying them off, on time, then youll end up with an A-1 credit rating. Then when you want to make a major purchase, like a car, or a house, you wont have any trouble qualifying at the bank. So theres good value in using credit cards. They allow you to buy something you want now, enjoy it now, and pay for it later. Thats the reason credit was given in the first place, way back in the 18th century to allow you to buy larger items like furniture, that you couldnt afford to pay cash for. The system worked great, and still does today as long as you dont abuse it. |
