Weigh up whether a credit card is right for you with our comprehensive list of pros and cons.
Credit cards can be a convenient way to manage your finances, but they can also be expensive and risky. If you’re deciding whether or not a credit card is right for you, here are 15 of the main benefits and disadvantages you can weigh up to make your decision.
If you’re wondering whether a credit card is a good fit for you, you can also use our lists of the types of people credit cards are suited (and not suited to) to help make the right choice.
Important points on the benefits and disadvantages of a credit card
9 Benefits of using a credit card
The perks that come with paying on plastic include:
It’s also worth noting that, until recently, businesses often applied a surcharge when you paid with a credit card. Thankfully this is no longer allowed
6 Disadvantages of using a credit card
The downsides of spending with a credit card include:
Crucially, credit cards are a “revolving line of credit”. That means they can theoretically last a lifetime, because they don’t have an end date. Taking out a credit card is an ongoing commitment, so it’s worth doing a little homework before diving in!
Should I apply for a credit card?
Credit cards are suited to certain types of people, and certain circumstances, but not others. As well as considering the pros and cons, you may like to look at the following factors to help decide if a credit card is right for you.
A credit card may suit you if you
- Are at least 18 years of age
- Are a UK resident
- Have a regular source of income
- Regularly pay your bills on time
- Want to keep certain transactions separate from your everyday bank account
- Want to build your credit history
- Are keen to earn rewards for your spending
- Need a more flexible cashflow
- Can afford to pay a little extra for the convenience
A credit card may not suit you if you
- Don’t meet the typical eligibility criteria
- Often struggle to pay bills on time
- Don’t have a regular source of income
- Don’t want the hassle of having to compare and switch from time to time
- Can’t afford annual fees or interest charges
- Have bad credit
- Are happy to just use a debit card