Are Credit Cards A necessity?

It is amazing to see how fast things has changed. Credit cards, which used to be something that are ‘nice to have’ (or a privilege to have) just a few years ago, have become almost a necessity in today’s world. So much so that a lot of people carry not just one but several cards. So why are these "plastic cards" so irresistible?

• Convenience

Compared to cash, credit cards are much more convenient and are acceptable almost everywhere now. So you don’t need to carry a lot of cash with you every time you go shopping.

You are all loaded with the power to shop as long as you slip this small piece of plastic in your pocket. A credit card also provide the convenience of online shopping.

So you can order stuff online over the internet using your credit card as a payment mode and have your merchandise delivered at your doorstep.

• Safer than cash

It’s safer to carry a credit card as compared to cash. Cash shows itself not only while you are paying for a ticket at the ticket counter but also from the thickness of your wallet.

Thus they act as an invitation to muggers or thieves. On the other hand, no one can make out anything from a credit card. Moreover, unlike cash, credit card transactions can easily be traced.

If your credit card happened to get stolen, you can get it blocked by making a phone call thus making it unusable.

• Emergency help 

In case you run into an emergency situation or a financial problem where you immediately need some money, your credit card can easily bail you out. You need not wait for the month end to receive your pay.

• Options and opportunities 

A credit card opens up new options and opportunities for you. One suc option is online shopping. Not only is online shopping convenient but also offers discounted rates. In fact some of the things are available online-only.

So you might miss out on an opportunity, if you don’t hold a credit card. Also, you can pre-pone your purchases if you have a credit card.

So you could buy something now, pay by your credit card and pay-back the credit card company over a period of time i.e. no need to wait for next 5 salaries to buy something that you need now.

• Discounts 

Today, you can use a particular credit card to pay for your purchases like shopping, airlines, car rental agencies, hotels and many other merchants offer discounts when . A lot of them offer their own credit cards too which are also known as co-branded cards.

These entitle you to even more discounts. Sometimes credit card suppliers even offer a payback option where-by you receive a certain percentage back if you shop for more than a certain amount using that credit card.

Collaboration of credit card suppliers with various merchants and institutions serves a lot of benefits to holders of the credit card.

• Membership rewards 

Almost every credit card supplier also runs a membership rewards program. Such programs are actually aimed at promoting the use of credit cards.

For every purchase made on the credit card, you receive certain rewards points which are calculated based on the amount spent. Thus you keep accumulating points.

Once you have sufficient points you can exchange them for goods. Generally there is a wide range of goods to choose from e.g. bags, watches, wallets, movie tickets, music systems etc.

• Free insurance 

A lot of card companies also provide free travel insurance as another incentive. This includes lost baggage insurance too. This is a great benefit for people who are always on the move.

This combined with the hotel and car rental discounts seem to make these plastic money cards the best travel companion.

With so many benefits in their bag, credit cards surely are more a necessity than ‘nice to have’.