Why Should I Use Credit?
Think you can use cash for all your purchases and avoid the headaches associated with credit? You’re going to miss out on a lot of the advantages offered by our credit-based economy. In fact, credit is hard to avoid. When renting a car, staying at a hotel or making an online purchase, you may be required to use a credit card. Some of these places won't accept a debit card.
If you aren’t working to keep your credit history healthy, bad credit is probably working against you. Don’t have any credit to speak of? No credit is bad credit, too. The most important thing is to use credit to your advantage because someone else is always going to be looking at your history with credit in order to evaluate you on a financial level.
Credit impacts everything from opening a bank account to getting a job
Many employers will pull a copy of your credit history before deciding to hire you. If they see debt or an erratic payment history, you might not get the job offer—especially if you are applying for a job related to finance. Potential landlords might run a credit history check on tenants applying to rent property to make sure they are going to be reliable and pay their rent on time.
Showing strong habits of using credit regularly and paying your bills on time and in full will build credit and show future creditors that you are a good risk. Building credit is important for other purchases and financial goals in your life. Individuals with strong credit backgrounds get more opportunities to receive loans—at lower interest rates, which is essential when buying a home or making another large purchase. Insurance rates are also impacted by credit: the better your credit, the lower your premiums will be (in most states). Having good credit almost always saves you money.
Credit is always working. It’s up to you to determine if it’s working for you or against you. Remember, just because you don’t use a credit card does not mean you don’t have a credit history or credit score.