What are the pro's and con's of using credit versus cash?

Answer 1

Pro on credit cards:
Now days, your credit does more than ever before, even making a difference on the amount you pay on your car insurance. So using credit cards wisely helps keep your credit score high. When used wisely (the balance paid every month), you can use them more conveniently, such as on the internet when buying things on-line. You can often get a discount when receiving satellite or internet service when you use your credit card to get new service for the first year. You can get items in a hurry when ordering on-line or over the phone when using a credit card. You can pay bills faster with a credit card. I've heard of many people paying all their bills with a credit card, then paying the credit card with one check, or a direct withdrawal from their bank account. Makes for easier bookkeeping. Owning and using one credit card for everything makes it easier to keep track of all your trasactions.

Cons on credit cards: Losing your credit card can turn your whole life upside down for many weeks, months or even years. If you are late on one payment, many cards will raise the interest rate on your account. Using your credit card unwisely, like maxing out your account, then not being able to afford the payments, can damage your credit rating, making you a risk for any future loans you might need. Owning too many cards puts you at risk for losing one of them, or abusing them all.

Pros on cash:
You can use it for whatever you want. No one can tell you it's not good enough. It's always ready for whatever you need, whether it's at a rummage sale or flea market. Goes where credit cards can't. Easier to leave a tip. You can keep your purchases private. Gets you better service when you need something faster.

Cons on cash:
If you're on vacation in another country, you have to change your cash into whatever country you're in. Less likely you'll get it back if you lose it. Less able to keep track of if you don't write down how much you've spent. No record of purchases unless you get a receipt.

With all that said, I think owning one credit card and using it responsibly is a good thing. But, cash is still king, and gives you more freedom and privacy. <*)))><

Answer 2

Using either a person needs to learn self control and how to budget or neither one is good.

Credit Pro - Establishing a good credit base get's you:

being able to qualify for loans.
lower interest rates on home loans, car loans any type of loan.
lower insurance premiums.
being able to rent vehicles.
getting that better job.
etc., etc., etc.

Credit Con:

bad for the person who can't stick to a budget and has no self control.
if balance is not paid in full - then a person pays interest.


Cash

Pro - It's there and handy
Con - see pro list in credit as what you cannot do with no credit.

Dave Ramsey, the so called credit guru, has no credit. And he has said that he can afford to buy a car a week, but cannot even rent a car while he is out of town. Simply because he has no credit.

He had once filed bankruptcy and now is a millionaire. Which he made off of people who are in debt.

Wonder if, now that he's a millionaire, he paid all of those debts he filed bankruptcy for.

It's good to use his methods if you can afford to plunk down that $150,000 (+ or -) cash to buy a home. But if you don't have that kind of cash, you need credit and a good credit history to be able to make those types of purchases and to get a reasonable interest rate.

We are "NOT" living in our grandparents world !!!
If we were, having no credit wouldn't mean much.

Answer 3

Using a credit card has many pros if you are disciplined:
(1) You can buy now and pay 20 - 30 days later.

(2) If you are disciplined and pay off your entire balance every month, you can establish an excellent credit history.

(3) If you get a credit card that has a cash-back feature, every once in a while, you can get money back after having spent a certain amount on the credit card.

I rarely ever buy anything in cash. I really don't see pros for it except that you'll never go into debt if you are not disciplined about paying off your credit card.

Answer 4

The Basics Only:

A) Credit Card


1) Pro's

a) Withdraw money in foreign countries
b) Use for emergencies only
c) Use for car rental, that it covers the car rental if in any accidents
d) Can obtain free mileage
e) Create Credit Record to buy a house in the near future or rent an apartment
f) If someone stole your credit card, you don't have to pay for what he/she buy. You simply call the credit card company to cancel the card.


2)Con's

a) Interest rate
b) Late fee rate
c) Need to pay the mailing stamp
d) Easy to misuse the credit, when there is a high urge at the moment
e) Can ruin your credit record if file bankruptcy, or so on



B) Cash


1) Pros

a) Cannot ruin your credit record
b) Do not need to pay the mailing stamp
c) No interest rate
d) If there is a high urge to buy, you will be able to buy only if you have the cash
e) Never have to pay the late fee


2) Cons

a)Not able to create a credit record
b)You can get rob, then you lose everything
c)Foreign countries cannot give you change
d)No rental car protection, no free mileages, and so on

Answer 5

If you don't have the cash to buy what you want, save up til you do, because the interest rates on any credit card is too high a price to pay and you could destroy your life by getting in over your head.

Answer 6

Kiera,
Cash you control your life

Credit YOU are a slaver to debt

Banks call clients who pay their balances off each month 'deadbets' . Save your self the degradation that comes with working to pay credit bills. visit DaveRamsey.com to understand what your grandparents understood.

Go with L.U.C.K.

Answer 7

with cash you do not have to pay interest on the credit. but with a credit card you can put off paying til later but it wil cost you

Answer 8

for credit card
pro- buy now & pay later : )
con- intrest charges $$$ : (
for cash
con- gotta have enough right there on the spot usually
Pro- don't have to worry about paying later

Answer 9

There are no pro's because you just wind up in debt.

Answer 10

Pros are you get rewards, you can pay later.
Cons- fees lots of them.
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