Credit cards always seem like a good idea at first. Even if you've been burned in the past, when money gets tight, the shiny plastic rectangles seem like the perfect quick fix for any situation. Whether it's over-the-top finance charges, unheard of rates, or identity theft, there are a number of ways for that quick fix to turn into a long nightmare. I, for example, decided very quickly into my college career, that I was not going to get caught in a credit card three ring circus. It was trouble, and the kind I didn't want to get into. However, when my friend invited me to visit her in Europe over my winter break, I didn't see any other solution besides giving into to one of the several credit card offers I had received upon reaching my eighteenth birthday. Armed with a six hundred dollar credit limit about two hundred dollars in Christmas money, and a round trip ticket to Amsterdam, I set off for two weeks of fun-filled adventure. In retrospect, eleven hundred dollars total is a great price for an all-inclusive two weeks stay including Amsterdam, Paris, Brussels and Dublin. That is, until eleven hundred turns into seventeen hundred, and you realize one sleepy morning that you're not even paying for the trip at all, you're barely paying finance charges on your over-limit balance. This is just one of a few ways that credit cards can go awry. Recently a lot of cards have put sophisticated refund systems in place in order to protect victims of identity theft. A lot of smaller credit unions still have no real way of protecting their customers against this type of fraud. With internet shopping as popular as it has become, it is very easy to lose track of the many places that your personal banking information is floating around in. Also, with a lot of people using debit cards to get the same conveniences that credit cards provide without accruing the same drastic debts, it is easy for that identity theft to result in the stealing of actual funds, as opposed to credit. Money from your checking account can sometimes be much more complicated to replace, though there is the bonus of being able to go to a bank branch and speak with a real person, whereas most often, credit card companies are little more than voices and names in the cloudy netherworld of cellular phone waves. This isn't to say that credit cards inevitably lead to certain doom. However, before you decide that the flimsy plastic is the way to your dreams, make sure that you really understand all of the policies of the company you choose and that the credit card payments are a realistic part of your monthly budget. Small limit cards can be a good way to build credit for your future, as long as you make sure you make the payment minimums on time, and don't spend more than you can afford. If you don't follow those simple guidelines, youre on the right track to the wrong way. |
